UBC Homepage Bulletins Main Page Bulletin 1/99 Contents

Co-financing: Funding of co-financing by the relevant national or public authority or by private funds must be guaranteed. EU only finances a part of the costs of a programme or a project. 
Subsidiarity: EU only undertakes measures aimed at achieving goals which can not be achieved at the national level, and which are therefore, due to their scope or impact, more likely to be sufficiently realised at community level. This principle must be guiding during the negotiation process. 
The structural funds and the principle of partnership at work are important tools to be utilised by the local and regional authorities. The national government should not act alone but co-operate with local and regional authority representatives. Local authorities should co-ordinate their activities in their own national associations.

Subsidies

EU law prohibits state subsidies, including costs carried by municipal enterprises that distort or may hinder free competition. Each subsidy must be reported to the European Commission, which examines it and decides whether or not it is allowed. There are exemptions to this rule, and it is not easy to draw a clear line. Concrete example of what is not accepted are internal subsidies within a municipality using surplus of its electricity company to cover deficits in for example its public transport company.

Elections

All EU citizens have the right to vote and to stand as a candidate in municipal elections. This is regarded as a visible element of the development of the EU into a "political" union and should be seen as a decisive step towards a "Citizens Europe".

Municipal and regional finances 

Local and regional authorities in most countries regard the implications of both the existing directives (VAT directive and the consumer tax system directive) as well as the tax harmonisation policy currently being prepared by EU as largely underestimated. Another general problem derives from the European-wide pressure to reduce wagedependent taxes, resulting in substantial financial losses for local authorities. This is an issue that calls for a dialogue with the

national government but also at European level.

Environmental policy 

Some 2000 EU directives apply or affect the political or technical aspect of environmental protection. This may have considerable impact as local and regional authorities are forced to take environmental aspects into consideration. The national environmental protection policies in most countries have been increasingly focused on individual quality standards as a result of EU-membership, for

example in the fields of water, waste water, air and noise, as well as on technical standards such as specific emissions, noise level or chemical composition.

Employment policy

Although measures aiming at reducing unemployment, job creation and boosting economic activity are usually the responsibility of central governments due to their general competence with regards to economic policy, these issues are of high importance for local authorities and regional as well. 
Drawing up national employment programmes must be assessed in Brussels. Initiatives aimed at facilitating the setting up of enterprises, retraining and employment programmes for handicapped, long-term unemployment and youth employment, as well as measures to improve the quality of premises clearly touch upon the interests of local authorities. Being involved in coordination and in the decision making process is of importance for local and regional authorities. There are strong links between financial efforts by local and regional authorities and measures taken at EU level.

Urban development

These policy fields are becoming increasingly more important, as they aim at recording and developing local and regional authorities' own potentials. Urban policy tackles, inter alia, the issue of

making best use of the synergy between urban centres and local communities in their hinterland as well as between different markets and cultures in order to strengthen the role of the cities as centres of "logistic systems" for the entire region. This is also important in view of the fact that cities must face social and environmental problems due to their high population density. 
The objective of setting up appropriate future oriented systems calls for national support but also from the EU, which is now developing a European urban policy. 

Conclusion

The local and regional aspects should be taken into consideration in the negotiation process now. This is a task for national associations of municipalities and regions with the purpose of getting as favourable outcome of the negotiations as possible, for instance environmental transitory rules and guarantees of financial support from the structural funds. 
Another task is to establish a dialogue with the national government ensuring that municipal and regional aspects will also be taken into consideration when EUmembership is a fact. Local and regional authorities must also be given an active and important role in deciding on structural funds in their region. 
On municipal and regional level, actions should be taken as soon as possible to build up competence amongst both politicians and experts. It is a matter of gathering information, carrying out seminars and other activities, development of twinning relations with counterparts in EU-countries and so on. It is also important to add an EU-strategy to the local and regional strategic plans and development programmes. It does not have to be very complex - a few really important guiding principles for the EU-oriented work the municipality/region wishes to carry out.

By Mr Lars Ohman
International Director Association of Swedish County Councils
e-mail: lom@lf.se


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