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The future of the EU budget

In 2004, the EU expanded from 15 to 25 member countries. In 2007, Romania and Bulgaria will also join. In terms of allocations per capita there will be an overall reduction from 302 to 247 euros per annum – comparing these two years.

More important however, is the fact that allocations to the relatively rich (older) member states will be reduced substantially. Thus far, a comprehensive post-2007 picture has not been made available, although some key figures have been published, giving clear indications of likely future patterns and developments.

So less money to everybody and relatively more money to the poorer members, that then is one clear tendency. Another is the increasing level, in relative terms, of allocations for regional development, while at the same time, the money set aside for agriculture and rural development is being reduced.

At the EU-level, perhaps the most important aspect is the increasing focus on competitiveness and in particular on the Lisbon-priorities, which entail, more growth, more and better jobs and better governance, according to the accompanying EU-terminology.

Sweden and Finland have lost their Objective 1 status areas for the coming programming period. Admittedly, an additional provision of 35 Euros per capita and per annum has been granted to the so-called outermost regions of these countries. This reflects a continuing acknowledgement of their specific challenges at the European level.

These issues however tend to be increasingly marginalised in the EU financial perspective, as these areas have moved from a specific Objective in the 1994-1999 programming period (Objective 6), via an inclusion in the top-level support category in 2000-2006 (Objective 1) to a mere 'additional provision' for 2007-2013.

The effort to concentrate funding on areas where it is most needed has led to an exclusive focus on underperforming regions and countries, epitomised by the '75% of GDP' threshold. This entails that structural challenges, such as those encountered by Northern peripheral regions, are downgraded to second rank issue status.

Seen from a Nordic perspective, the question remains whether reductions in EU-funding will result in regional and local pressure for new national efforts in regional policy.

By Odd Iglebaek