The original aim of the EU funds was to support countries joining the European Union (EU) in order to close the gap with other European countries. However, in Slovakia, even after 20 years since joining the EU, almost all large investments are made from EU funds. In the pre-election Eurodebate of Zdravotnický deník, Ekonomický deník and Česká justice entitled The Future of Europe – an agenda for the new European Parliament and European Commission with Lucia Yar, candidate to the European Parliament for the Progressive Slovakia movement, we discussed the cohesion policy of the Union and whether in its current form it is meeting its objectives.
„Euro funds make up the majority of investments that come to our regions and we fill investment gaps with them. However, cohesion in Slovakia has an insufficient levelling effect and there are still large differences between regions,“ says Lucia Yar. Progressive Slovakia, for which she is a candidate, is part of the Renew Europe faction in the European Parliament. Yar argues that the Košice and Prešov regions, in particular, are among the least developed regions in the EU.
Poor management of EU funds
According to her, there are structural problems with the processing of European money in Slovakia, as we are unable to use it efficiently. Various actors have been pointing this out for a long time. The MEP candidate thinks that Brussels should push the states to make the distribution of resources from operational programmes more the responsibility of regional structures. At present, almost 80 per cent is managed from Bratislava. The transfer of competences to the regions is one of the points advocated by Progressive Slovakia in its programme.
„In the current system, small municipalities with 100 or 200 inhabitants are fighting among themselves for a piece of European money for things that are not even that relevant to them. Some municipalities, for example in the east of Slovakia, don’t even have a sewerage system,“ said Yar, who herself comes from the east of the country. The Czech Republic, for example, has abandoned regional operational programmes managed by regions. This was supposed to be because of bad experiences and high levels of corruption. According to Yar, the difference is mainly in the distribution of the country, where it is true that the further away from Bratislava, the more neglected and less understood the region is.
The candidate highlighted the obvious benefits of structural and cohesion funds, such as new public buildings, health facilities or schools. However, given the amount of funds that come to us, they are not enough, in her view. This is precisely because of infrastructure problems with the redistribution of resources. „Euro funds have clearly helped economic convergence to Western Europe, but society’s expectations have not been met. For example, digitalisation and green investments have been very slow to take off,“ he says. „In Slovakia, we have a problem managing operational programmes and they are linked to a huge bureaucracy, which is why various organisations have no appetite to apply for funds,“ he criticises.
Make money conditional on reforms and respect for rights?
Cohesion policy has long been one of the highest items in the European budget. „Slovakia benefits greatly from this policy and it would be difficult to explain to the population that cohesion funds from the EU will no longer flow to us. However, if there will be any cohesion policy left in the future, it will be for the countries joining the Union,“ predicts Lucia Yar. For EU member states that have so far failed to close the gap with other European countries, such as Slovakia and the Czech Republic, she says the set-up of support mechanisms needs to be transformed. „It could be similar to the recovery plan – i.e. finance conditional on reforms,“ she said.
The programme of both Progressive Slovakia and the liberal faction of the European Parliament, Renew Europe, also states that the use of EU funds should be conditional on respect for democratic principles. „If the rule of law is not respected in a country and authoritarian tendencies are evident, the money should be stopped,“ Yar says. The question is how this compliance would be judged. Yar says setting the conditions must be a matter of debate. „If basic rights such as journalistic freedom, the right to express or assemble or to do ordinary opposition politics are violated, money should not be sent to the government of this country,“ she warned.
Cohesion priorities
European investment funds different types of projects. Subsidies are aimed at public welfare or health, but do not bring profits. Research and development projects have the potential to make money, but profits and return on investment are expected mainly from infrastructure and innovation projects, technological development and environmental projects. Then there are, for example, urban projects – smart cities, or even things in the cultural and creative industries.
Regarding the health sector, Yar stated that in general, the healthier the population, the more prosperous companies are: male and female employees are more fully at work, they do not have to be sick, they are more efficient and effective. „In recent years, however, the mental health of male and female employees has also been highlighted in the EU, and this is something that Slovak society should work even harder on. Slovakia lags far behind other developed countries in financing mental health care,“ he says. According to the Value for Money Unit (VVU), only 3 percent of total healthcare spending goes to mental health, while the average for developed countries is 6-7 percent. In addition, mental disorders generate costs for Slovak society of up to €2.1 billion a year (2.4 percent of gross domestic product in 2019, according to the ÚHP). „It is from the EU level that we should also push for development in this area,“ the MEP candidate thinks.
„The European Union is trying out combinations of subsidies and financial instruments in different areas. In Slovakia, we do not use financial instruments such as European loans that much,“ says Lucia Yar, adding that the bureaucracy is what discourages people in the country from applying. „The quality of institutions is completely different across Europe, and cohesion is also needed,“ she added.
The priorities of cohesion policy should be the green and digital transformation of households, businesses, public and state administrations. „This should be tailored to what is missing in the region. Money should also go into basic things in infrastructure development, including the aforementioned sewage system, for example, from the state level. In Slovakia, we no longer invest in basic infrastructure and we have replaced everything with EU funds,“ the MEP candidate noted.
In the case of Slovakia, how the situation in Ukraine develops will also be crucial for regional policy in the coming period. „If Ukraine becomes an EU member state after the war and a sustainable peace is secured, this could be a huge opportunity for the east of Slovakia – just as it happened with the east of Austria at the time of our accession,“ adds Yar. The topics of defence and security policy are covered in other articles.
The European Parliament elections are scheduled for 6-9 June this year in the member states and in Slovakia on Saturday 8 June.
Lucia Hakszer
Photo: Tomáš Bokor
