More flexible access to the EU regional funds - such as the European Social Fund and the European Regional Development Fund - would help regions worst hit by the economic crisis to recover faster, said the Regional Development Committee. Flexible funding for investment in infrastructure, support for small firms, professional training, R&D and industrial and rural modernisation, would also make a decisive contribution to sustainable growth and jobs, it adds.

As the main source of public investment at regional and local level, EU regional policy is "not only a way to immediately 'damp down' the negative economic and social effects of the crisis, but is also a long-term policy for combating the structural problems revealed and created by the crisis, particularly as regards competitiveness and employment" in areas lagging behind in their development, says the report drafted by Mrs Kratsa-Tsagaropoulou (EPP, Greece). "Given the EU’s lack of effective mechanisms for economic coordination and balanced growth, cohesion policy, through the structural funds and other actions, is of prime importance."

EU funds most needed in regions worst hit by the crisis

The report focuses on the importance of maintaining and improving EU aid to "Objective 2" regions, i.e. those areas in EU Member States, old and new, facing economic difficulties as a result of profound structural changes in their economies: industrial areas with high unemployment, rural areas faced with population decline, poorer urban areas with high unemployment and crime rates, and fisheries areas. In 2007-2013, EU support for the economic and social conversion of these areas will amount to €54.7 billion, benefiting 314 million people in 168 regions.

Thanks to EU regional aid, these regions have gained steadily in productivity and employment rates, catching up on EU averages. But the 2008/2009 economic crisis hit them hard, exacerbating their structural and competitive disadvantages. Faster and easier access to EU funds is therefore sorely needed to help these regions continue to invest in their future.

Flexibility of funds must continue

MEPs call for greater flexibility in the allocation of EU funds to help regions face the specific challenges posed by the crisis, particularly in Objective 2 areas. Recent measures aimed at speeding up the implementation of cohesion policy programmes are a step in the right direction, they say. "It is particularly important that the strategic approach of flexibility continues", states the rapporteur, Mrs Kratsa-Tsagaropulou.

In May, the European Parliament backed faster and simplified procedures and requirements for the European Regional Development Fund, European Social Fund and Cohesion Fund (amending Regulation (EC) No 1083/2006).

Support for SMEs

MEPs welcome EU cohesion policy support measures for small and medium-sized enterprises (SMEs - about €55 billion is allocated for businesses between 2007 and 2013). The measures, aimed at fostering innovation, technology transfer and the modernisation of SMEs, "must be targeted at long-term restructuring" of businesses and the transition to a more sustainable economy, not at "fire-fighting interventions for economic survival", the report states.