EU Cohesion Policy and European Integration

The Dynamics of EU Budget and Regional Policy Reform

John Bachtler, Carlos Mendez

• Éditeur: Routledge
• Année: 2016
• ISBN:
  9781317140436
• Édition: 1
• Sujet: Politique et relations internationales
• Sous-sujet: Politique européenne

EU Cohesion policy accounts for a major share of the EU budget and is central to economic and social development in many European countries. This book provides a comprehensive and theoretically-informed analysis of how Cohesion policy has evolved over time, in particular the budgetary and policy dynamics of the 2007-13 reform. In the context of the budgetary politics of the EU, the book examines the process by which the reform of Cohesion policy has been shaped; it identifies the key factors that explain the allocation of funding, assesses the roles of the Member States, European Commission and European Parliament, and tests whether the process and outcome are consistent with the expectations of EU decision-making and integration theories. Based on extensive, EU-wide research over a ten-year period, the book provides new insights into both the process and outcomes of EU policy reform. Presenting original research in an accessible format, this book will be of interest to scholars as well as undergraduate and postgraduate students in the fields of European integration and policy studies.

PART I
The Theoretical and Policy Context

Chapter 1
Introduction: Analysing the Reform of EU Cohesion Policy

Analysing Cohesion Policy Reform

Over the past 25 years, the European institutions have agreed five major reforms of EU Cohesion policy, determining how one of the largest parts of the EU budget should be spent. On each occasion, the budgetary and regulatory changes were the outcome of a complex, protracted and contentious process of analysis, discussion and negotiation involving European, national and sub-national actors. The debate covered major political questions ranging from the future direction of European integration and the role of the European Commission to highly technical arguments concerning the criteria for allocating EU funding and rules for managing development programmes on the ground. Underpinning negotiating positions is always the perennial issue of ‘net budgetary balances’ – the amounts that individual countries pay into and receive from the EU budget.

The reform of 2005–06 is a good case study of the processes and factors influencing decision-making on budgetary issues and specifically Cohesion policy. The distinguishing feature of this reform was that the Member States and European institutions had polarised views on the future direction of Cohesion policy and EU policy-making more generally, differences which followed through into the 2011–13 reforms. While it had long been clear that EU enlargement would create major new challenges for Cohesion policy, the debate went beyond the amount and allocation of funding; it questioned the principle of ‘solidarity’ on which Cohesion policy is based and took issue with the ‘added value’ of the Structural and Cohesion Funds. The outcome produced a new strategic role for Cohesion policy in supporting the relaunched Lisbon (growth and jobs) agenda and an implementation system incorporating elements of the ‘open method of coordination’. Understanding the process through which the eventual agreement was achieved reveals much about the state of the EU and European integration.

The centrality of Cohesion policy to the budgetary politics of the EU has been recognised since the creation of the European Regional Development Fund (ERDF). However, while there has been extensive research on the negotiation of the EU budget and the ‘key cleavages’ among Member States (for example, Shackleton 1990; Laffan 1997; Laffan and Shackleton 2000; Blavoukos and Pagoulatos 2010), there has been much less analysis of how the Cohesion policy elements of the EU financial perspectives have been developed.

From a regulatory perspective, much of the existing literature has analysed individual phases of Cohesion policy reform, assessing the implications for policy implementation and territorial relations. However, the primary focus of this literature has been on the post-decisional stage of implementation, often relating to conceptual debates about multi-level governance and Europeanisation, with limited attention given to the process of policy formation and negotiation at the EU level. A related strand of the literature has examined the implications of policy reforms for changes in the balance of decision-making power between the Commission and the Member States over successive reforms. This has left important questions unanswered. As Kohler-Koch (2002) and others have noted, it is interesting to explore not just ‘who decides what’ but how and why decisions are taken. In the context of Cohesion policy, such questions are difficult to answer because of the complex interactions between EU, national and sub-national interests, the evolution of positions and interests over time, and (not least) because key stages of the reform debate are conducted in ‘closed’ committee meetings and through bilateral and informal discussions among the main actors.

This book aims to undertake a more comprehensive and in-depth analysis of the dynamics of Cohesion policy reform than has previously been published. Its objectives are: to examine the process by which the reform was shaped; to identify the key factors that explain the nature of the process and final outcomes; to assess the roles and preferences of the key actors and how these evolved over time; and to test whether the process and outcome are consistent with the expectations of EU decision-making and integration theories. Based on extensive, EU-wide research over a 10-year period, the book provides new insights into both the process and outcomes of EU policy reform. Its focus is the debate and negotiations on the reform of Cohesion policy for the 2007–13 period. Theoretically informed by the EU Studies literature, the book explores the political and policy pressures influencing the reform debate, the conflicting national and European viewpoints, and the process of negotiation leading up to agreement in 2006.

The innovative approach of the book is based on a combination of the following three factors. First, the book takes a ‘longitudinal’ perspective, process-tracing the whole cycle from the agenda-setting discussions which began in 2001 through to the formal negotiations in 2004–05 and legal ratification of agreements in 2006. An assessment of previous reform phases situates the 2004–05 policy review in historical context in order to identify the key factors shaping the evolution of Cohesion policy. The book also looks forwards, drawing conclusions for future reform debates and the longer-term direction of Cohesion policy.

Second, it combines an account of the broad political positions shaping the reform agenda with detailed analysis of the specific policy and budgetary elements (notably the methodologies for spatial coverage and financial allocation) comprising the ‘building blocks’ of the reform proposals and eventual agreement. Although these elements are the central decisions in determining the redistributive outcomes of the EU budget, they have not been extensively covered in the existing literature on EU budgetary reform (for example, Wallace 1980, 1982; Shackleton 1990; Laffan 1997; Laffan and Shackleton 1996, 2000; Laffan and Lindner 2005; Lindner 2006; Ackrill and Kay 2006; Dür and Mateo 2010a). In this way, the book provides important new insights into the policy process of the EU budget. A similar approach is adopted for the analysis of the regulatory outcomes of Cohesion policy reform. By reviewing the process of negotiating the Cohesion policy regulations through the Council (notably in the Structural Affairs Working Group), it sheds light on a neglected aspect of the Cohesion policy process (for example, Marks 1992, 1993; Hooghe 1996; Bache 1998; Leonardi 1995, 2005).

Third, the book provides comparative insights on how individual Member States participated in the Cohesion policy reform, addressing an underdeveloped area of the literature. With some exceptions, such as Moravcsik (1998), Dyson and Featherstone (1999) and Thomson et al. (2006), relatively few researchers have systematically explored the configuration of national experiences in EU policy-making on a comparative basis in detailed, book-length volumes. Such research is especially scarce in the field of Cohesion policy, notwithstanding a limited number of papers focusing on the negotiating experiences of individual Member States – such as Germany (see the contributions to Hartwig and Petzold 2005) or Italy (Brunazzo and Piattoni 2004).

In addition to standard documentary sources, the research for the book is based on in-depth interviews conducted with senior officials of Member States and European institutions conducted each year during the reform debate over the 2001–2006 period, and subsequently in 2007–10, together with access to unpublished papers, notably national government position papers and European Council meeting papers. Together, these sources provide new and distinctive insights into the dynamics of EU negotiations, of interest both for theory on EU policy-making and integration and for policy practice.

Theoretical Perspectives on EU Policy-making and Integration

The EU Studies literature provides a wide range of theoretical perspectives through which to understand and explain policy-making dynamics in the EU and integration more generally. This book does not engage in a detailed exposition of this literature, but it is useful to review briefly the relevant perspectives to provide the context for the survey of Cohesion policy scholarship in the following chapter and to highlight some of the bigger questions and themes that will be discussed throughout the book.

The academic literature on the European Union has witnessed several shifts in dominant paradigms reflecting European integration developments and changes in academic orientations. Integration theory was launched in the late 1950s by a school of thought known as ‘neo-functionalism’ (Haas 1957). The core argument was that European integration was being driven by a functional spillover logic, whereby initial decisions to place specific sectors (such as coal and steel) under the central control of common institutions (the European Coal and Steel Community, ECSC) would unleash self-sustaining pressures towards further integration in other policy sectors. Another postulated form of spillover was ‘political’ in nature, involving the transformation of societal actors’ attitudes, beliefs and activities, particularly through interest and political groups’ mobilisation and lobbying in an effort to create further common policies. A final source of integration was embodied in the notion of ‘cultivated’ spillover through the socialisation and manipulation of policy-makers’ interests, again leading to further task expansion and the vesting of more authority with supranational actors.

The early years of integration in the Community were generally viewed as a vindication of neo-functionalism. Evidence of spillover from the ECSC was provided through the creation of the European Economic Community (EEC) and EURATOM under the Treaties of Rome in 1957, setting up a common market and new common policies in the areas of agriculture, transport, trade and competition. The Treaty of Rome was implemented by a proactive European Commission under the entrepreneurial leadership of Walter Hallstein, and there was a strong mobilisation of sectoral interest and lobby group activity around Brussels.

However, the subsequent agricultural policy and institutional crisis brought on by the collision between Charles De Gaulle and the European Commission in the mid-1960s prompted a paralysis in European integration and revealed the limits of neo-functionalism. European decision-making on further integration was halted by entrenched vested interests to varying degrees in different Member States, the relative difficulty of task expansion into areas of positive, as opposed to negative, integration, and the exhaustion of mutual gains from cooperation. The theoretical critique of neo-functionalism was provided by ‘intergovernmentalism’ (Hoffmann 1964, 1966). Rooted in a realist understanding of international relations, Hoffmann rejected the ‘automaticity’ of the spillover thesis and emphasised instead the ‘logic of diversity’ and the ‘obstinate’ nature of the nation-state in Europe and the international system more generally.

The stagnation of European integration in the early 1970s was accompanied by a surge in empirical studies on a range of policies and issues. These sought to fill a data void in the literature and provided insightful analytical descriptions and explanations of the EC policy process (Caporaso and Keeler 1995) and ‘the foundation for later studies of both the integration process and the functioning of the EU as a polity or system of governance’ (Cram 1996: 53–4). Exemplified by the Wallace et al. (1977, 1984) volume, several contributions are of note. First, it provided comprehensive insights into how EC decision-making processes worked in practice. Second, it distinguished the different policy modes, which varied according to the source of initiative, types of policy instruments available, and patterns of shared responsibility between the national and Community levels across policies. Third, attention was drawn to the importance of politics in policy-making, including at the domestic level. Fourth, knowledge was furthered about the post-decisional stage of policy implementation. A final contribution was to encourage engagement with domestic politics and policy approaches for studying the EU, while recognising the futility of searching for a single, all-encompassing lens for understanding European integration and policy outcomes.

The relaunch of European integration in the mid-1980s sparked a fresh wave of grand theorising and a proliferation and diversification of the EU Studies literature (Keeler 2005). In part, this revisited earlier debates of the 1950s and 1960s but with important new dimensions. For instance, Sandholtz and Zysman’s (1989) core arguments clearly echoed those of Haas by stressing the crucial role of supranational policy entrepreneurs and transnational interest groups in determining the timing and content of the Single European Act, but also recognising the constraints of the domestic and international context.

Once again, the emphasis on the role of the Commission as an agent of integration and of policy innovation was countered by intergovernmentalitsts. Moravcsik (1998) in particular put the preferences and power of the Member States centre stage, rejecting the view that integration was driven by technocratic planning, geopolitical concerns, unintended consequences and supranational entrepreneurship. Instead, Moravcsik’s liberal intergovernmentalism framework held that integration was primarily driven by the convergence of Member States’ (largely, economic) interests and the resolution of distributional conflicts through interstate bargaining. Subsequent research in the 2000s has identified a range of factors influencing the bargaining success of Member States in negotiations, including (reviewed in Bailer 2010): voting power; economic size; exit/veto threats; holding the Presidency; bargaining skill and expertise; and domestic constraints.

During the same period, a ‘governance turn’ stimulated a more explicit focus on the functioning of the EU as polity, again contributing to the mainstreaming in EU studies of traditional political science research themes and tools from comparative politics and policy analysis (Hix 1994; Richardson 1996). Originating in a study of Cohesion policy, the ‘multi-level governance’ (MLG) model was arguably the most well-known conceptualisation of the EU’s governance architecture (Marks 1993), highlighting the shared and fluid nature of decision-making involving actors and networks at different levels (EU, national and sub-national). Rooted in a similar pluralist conception of politics, policy-network theory emerged as another dominant approach and was instrumental in the development of rich, analytical descriptions of the multitude of actors and organisations involved in EU policy-making (Peterson 2004).

During the 2000s, new modes of governance scholarship became a popular research agenda (Kohler-Koch and Rittberger 2006), stimulated by the launch of the Lisbon strategy and the Open Method of Coordination. The central feature of these new modes is the use of non-hierarchical and voluntary instruments for achieving collectively defined EU goals, in the absence of agreement to grant the EU new competences to legislate in sensitive areas. The main focus of academic enquiry has been on explaining the sustainability and effects of New Modes of Governance (NMG) particularly in terms of efficiency and legitimacy. At the same time, and closely associated with the governance turn, the Europeanisation literature has shifted the analytical spotlight more firmly onto post-ontological questions about the EU’s impact on domestic polities, politics and policies (Radaelli 2000; Risse et al. 2001).

These approaches and others have brought several features to the fore in EU Studies: traditional concerns of mainstream political science with policy and institutional performance; the power of ideas and policy entrepreneurship; the different stages of the policy cycle, particularly agenda-setting/framing and implementation; and the democratic accountability and legitimacy of the EU.

In parallel, more meta-theoretical issues and debates from the social sciences have risen up the agenda through an ‘institutionalist turn’ in EU Studies. Rational-choice inspired approaches have focused attention on the EU’s institutional structure (and on principal-agent dynamics), particularly in terms of how outcomes are influenced by different legislative procedures. By contrast, historical institutionalist insights have been profitably employed to shed light on the role of path-dependent, temporal dynamics in shaping institutional and policy outcomes in the EU. A sociological variant of institutionalism is exemplified by the ‘constructivist’ school (Christiansen et al. 1999), the central claim being that preferences and identities cannot be taken as given, but are rather shaped or constituted by EU-level institutions, particularly those of an ideational, cultural and discursive nature. A prominent area of research that is relevant to this investigation is EU committee governance and whether argumentative discourse and technocratic consensus-seeking goals are able to shape policy-making outcomes or overcome hard-ball bargaining behaviour and formalised voting routines (for a review, see Christiansen and Larsson 2009).

Structure of the Book

The book is divided into four main parts. The first part sets out the theoretical and policy context for the debate. Chapter 2 begins with a survey of the academic literature on Cohesion policy. It explores the development of research on Cohesion policy and discusses – for each major phase of policy evolution – the analytical/empirical foci, explanatory factors and theoretical perspectives used in the literature for explaining the processes and dynamics of Cohesion policy.

Chapters 3 and 4 consider the historical development of Cohesion policy. They review first the emergence and creation of the ERDF, and the incremental changes made in 1979 and 1984, and then the landmark reform of 1988 and the 1990s reforms – in 1993 and 1999 – which provided the policy starting points for the 2000–06 period.

The main concern of Chapter 5 is with budgetary politics: how much, who pays and who gains. It introduces the EU budget (size, headings, change over time, own resources) and outlines the evolution of the Community system of finance over time, notably the move from nationa...