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New Cohesion legislation has entered into force on 1 July

The Parliament has adopted the political agreements of the Cohesion’s legislative package 2021-2027, and the co-legislators (Commission and Parliament) have signed a €373 billion’s worth Cohesion policy, ending the legislative procedure with a slightly increased budget, but there is still uncertainty about the cohesion impact of the additional funding under New Generation EU (the Recovery Fund), implemented through national plans and envelopes.

(6 July 2021)

Main decisions were already advanced at the end of the Trilogue negotiations last December, but now all steps have been made, and the Cohesion package has been closed by the EU institutions. The Regulations have been published in the Official Journal of the EU on 30 June 2021 (OJEU, vol. 64, L231) and have entered into force on 1 July 2021. Implementing acts will follow, detailing available resources per Member States and the categories of regions. Then, Member States and regions will prepare the programming documents.

The Cohesion Package includes:

The new CPR is a joint legal framework for eight shared management funds: the ERDF, the CF, the ESF+, and also the European Maritime, Fisheries and Aquaculture Fund, the Just Transition Fund (JTF), and financial rules for the Asylum, Migration and Integration Fund, the Border Management and Visa Instrument and the Internal Security Fund.

For many border regions, the JTF is very promising, and the CPR establishes key elements for the functioning of the new Just Transition Fund (JTF) Regulation which completes the  Cohesion policy funds 2021-2027. The European Parliament has also adopted the Public Sector Loan Facility that will effectively complete all proposals under the Just Transition Mechanism (JTM). This regulation is announced to be adopted by the Council on 12 July.

The JTF is a key element of the European Green Deal and the first pillar of the JTM, aimed to alleviate the social and economic costs resulting from the transition towards a climate-neutral economy, diversifying the economic activity and helping people adapt in a changing labour market.

The ERDF and CF Regulation sets specific provisions for the European Regional Development Fund (€226 billion) and the Cohesion Fund (€48 billion), contributing to strengthening cohesion by correcting imbalances between regions, while delivering on the Union’s political priorities through a thematic concentration of resources.  The CF will support projects in the field of environment and trans-European networks in the area of transport infrastructure.

The European Social Fund Plus is the key financial instrument to implement the European Pillar of Social Rights, to support jobs and create a fair and socially inclusive society. €99.3 billion (in current prices) in 2021-2027 for Member States to create and protect jobs, promote social inclusion, fight poverty, including by combatting homelessness, and prepare workers for the digital and green transitions. It includes a requirement to invest in young people and address child poverty.

Interreg VI continues with a similar architecture and most €8.1 billion budget is devoted to the traditional strands (cross border, transnational and interregional). It sets up a new strand to reinforcing the regional cooperation of outermost regions. And it will also cover cooperation at the external borders of the Union through the support of external instruments such as the Instrument for Pre-accession Assistance (IPA) and the Neighbourhood, Development and International Cooperation Instrument (NDICI).

Commissioner for Cohesion and Reforms, Elisa Ferreira, said: “Now we need to focus on implementation in a way that provides the best possible support to regional and local authorities, citizens and companies. A spirit of partnership was key in the design of this package; the partnership principle will be crucial for a successful implementation.

Commissioner for Jobs and Social Rights Nicolas Schmit added: “Cohesion funds are an integral part of the EU’s toolkit to support Member States in building a stronger, more inclusive Europe. The European Social Fund Plus invests in people. It helps workers to re-skill and up-skill, to be ready for the transition to a green and digital economy. It protects the most vulnerable in our society, such as children in need and homeless people. And it gives a boost to entrepreneurs and innovators in need of financial support.”

Breakdown of Cohesion Policy allocations per Member State (current prices)

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