Same amount but more flexible - “Friends of Cohesion” agree on joint declaration on funding in future EU budget

Prime ministers and government delegates of ‘Friends of Cohesion’, photo: ČTK/Ondřej Deml

Government delegations from 17 EU member states, known as the “Friends of Cohesion”, are meeting in Prague on Tuesday to discuss a united position on the EU’s budget for 2021–2027. All except Italy issued a joint declaration which states that the future EU budget should include the same level of cohesion funding, but states should be given more flexibility in how they use it.

Prime ministers and government delegates of ‘Friends of Cohesion’,  photo: ČTK/Ondřej Deml
When it comes to the EU’s financial framework budget plans, the union can divide into two groups – the wealthier ‘net contributors’ and the poorer ‘recipients’.

Especially when it comes to EU cohesion funds, which aim to reduce economic and social disparities by allocating extra money to states whose gross national income per inhabitant is below that of 90 percent of the EU average.

The current EU budget proposal for 2021-2027 plans on cutting cohesion policy funding. The European Commission’s reasons for this are mainly the impact of Brexit, which will see the second largest net contributor leave the EU.

Naturally, the member states that benefit from such funding are not pleased about this new budget plan, which would see them miss out on billions of euros.

A total of 17 EU members have therefore come together within an informal ‘Friends of Cohesion’ group, which was originally set up to lobby for cohesion policy during the previous budget negotiations in 2012. Its members include the 13 states who joined the union since 2004 as well as Greece, Italy (which is a net contributor), Portugal and Spain.

The prime ministers and government delegates of these countries are meeting at Prague Castle this Tuesday and have produced a joint declaration that calls for cohesion funds to be kept at their current level.

During the morning hours ahead of the summit, Czech Prime Minister Andrej Babiš explained the cohesion group’s primary aim to journalists after meeting with his Central European counterparts from the Visegrad Four.

“The countries that we invited and whose representatives arrived in Prague today are united in their view of cohesion politics as a key investment tool that enables our citizens’ wealth to increase and lowers the inequality within the European Union…

“We agree on the fact that it is vital to secure sufficient finances for the cohesion policy. Without sufficient funds the EU is unable to fulfil the needs of its citizens.”

Andrej Babiš,  photo: ČTK/Ondřej Deml
Aside from ensuring that sufficient money remains available, the group also agreed its states want greater flexibility in how they can use cohesion funds. The Czech prime minister explained this point earlier on Tuesday..

“We have to rid ourselves of the administrative burden that is connected with EU funding. Member states should have the ability to decide on their own about which areas they want to spend these resources on. That is the only way to effectively react to domestic needs and allocate funds where they can have the most significant benefit.”

According to the European Council on Foreign Relations, the most delicate part of the negotiations between the net payers the recipients is set to take place during the second half of 2020.

Germany has pledged to contribute more to the EU budget to bolster economic stability and structural reforms within the Eurozone, but it is unclear whether its fellow net contributors are prepared to do the same.

Although the Czech Republic is currently a net recipient, some experts predict this position may change to net contributor within the period of the next EU budget, sometime during the mid-2020s.