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DevelopmentEuropeOrganisationsPolitics

The misplacement of structural funding and how it could pull the EU apart

Source: William Murphy/Flickr

 

The European Union’s Unknown Weakness

The United Kingdom is halfway through the arduous process of leaving the European Union, Poland’s leadership planned on taking its country away from an impartial, fair judiciary, and Euroscepticism is rising quickly throughout the Union. The causes of this are widely debated, with blame being pointed at the amount of money spent on the Union, the amount of sovereignty states have lost and immigration figures increasing. However, very little of the time is the EU’s structural funding system brought into question. I believe that in Eastern Europe at the very least, the sheer failures of the EU to properly development funds is a key cause of opposition.

Firstly to establish what I mean by development funds. With Eastern Europe being so drastically less well off than the West, the EU developed a system by which richer regions would fund the poorer ones. There are multiple programs, but in this article, we’ll mostly be looking at the ERDF, or the European Regional Development Fund.

To preface the mostly negative nature of this article, I do think that the ERDF is a good idea at its core. When used correctly, it has helped to hugely develop less well off regions and improve the lives of many people. For example, from 2007-13 over 50 projects took place in the Czech Republic, from fixing a city’s waste management problems to improving transport links so people could travel faster within and outside the country. With projects like this taking place all over the EU, in the long run productivity and growth are likely to rise, meaning that the quality of life for all people in Europe should, in theory, improve.

However, this is only in theory. In reality, there are two major problems with the Union’s usage of the development fund; funding regions that don’t really need it, and the use of ERDF money in what could be seen as vanity projects.

In terms of funding areas that don’t truly need it, one perfect example can be seen in Slovakia. In the capital city of Bratislava, a region with a GDP per capita of over €50,000, multiple transport projects took place between 2007 and 2013, with even more projects planned to come in the future. Bratislava is by a long way the wealthiest region in Slovakia. It has an average income more than double that of Slovakia’s average, with an economy heavily influenced by banking and insurance firms. By comparison, the poorest region in Slovakia is Presov. This is a region with an average income less than four times Bratislava’s, yet their citizens see significantly less investment than their fellow nationals to the West. This shows off one simple failure of the ERDF, being that funds at times fail to reduce inequality and often at times worsen them.

Similar to this is the EU’s apparent penchant for vanity projects. A bit of an anecdote to start this point, I’d taken a trip to Morecambe for the day in order to help my girlfriend interview for a volunteering role, and we came across a flower bed. Above it, stuck to a wall in pride of place was a plaque, proudly stating that the flowerbed was “Funded by the European Union”. Confused by the idea that Development Funds could be used for this, I further researched into what else the EU had funded of a similar ilk. In the richest of all European regions, London, the ERDF had been used to fund an already sponsored cable car in London, “The Emirates Air Line”. For the EU to fund such projects that seem unnecessary (especially considering all the bridges already in London) and there
for show could be a problem for some facing financial struggles in the EU.

Ultimately, I feel like the failures of the EU to properly distribute funds have been a major cause of disillusionment in the Union. Given that many people ask what the benefits of the EU are, or question the high costs, to learn that these projects get funding whilst poorer regions have very little money attributed to them is highly off-putting. If this happens, people are far more likely to look inwards, to local government, leaving prime conditions for nationalism and anti-EU sentiment to emerge.

If these conditions continue, I believe the EU could be in real long run trouble, due to dissent throughout the members in Eastern Europe. Disillusionment can continue to spread, and for the EU to continue at full strength, it must either re-consider spending to bring real equality or face the consequences of opposition from those who are left behind.

 

By Joe Blackburn

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