Principals, agents, and the implementation of EU cohesion policy

Abstract

The purpose of this paper is to analyse who controls the implementation of EU cohesion policy. The main argument is that EU control mechanisms are weak and that the goals formulated at the EU level are likely to be remoulded in the implementation process in order to suit the preferences of the implementing actors at the national level. In order to make this argument it is necessary to move beyond the traditional approach to EU cohesion policy, i.e. the multi-level governance model. I suggest the principal–agent framework as an alternative approach. An inspection of EU cohesion policy through the lenses of this approach uncovers serious implementation problems. The empirical relevance of this argument is demonstrated in a study of the implementation of a selected area of EU cohesion policy, the Urban Community Initiative.

Keywords:

• Cohesion policy
• implementation
• multi-level governance
• principal–agent theory.

Acknowledgements

An earlier version of this article was presented at the APSA conference (Philadelphia, USA) in 2003. Many thanks to Kutsal Yesilkagit and three anonymous referees of the JEPP for helpful comments. Financial support from the Danish Democracy and Power Study is gratefully acknowledged.

Notes

1 In a broad sense, EU structural policy comprises two additional sets of activities which are not regulated by the structural fund regulation. First, the Cohesion Fund supports infrastructural and environmental projects in the poorer EU member states, but it is not a structural fund in the formal sense defined by Council Regulation 1260/1999 and its activities are not co-ordinated under the official structural priority objectives. Second, a considerable part of the EU's structural support in the agricultural and fisheries areas is not regulated by the general structural fund regulation, but by other rules. This type of support may be considered structural, but is also sometimes referred to as ‘accompanying measures’ to the common agricultural and fisheries policies (see e.g. European Commission 1999a: 5).

2 The Council of Ministers is thus the central law-making body, but the European Parliament is not without influence. The general structural fund regulation is decided according to the assent procedure which leaves the European Parliament only limited influence. But the regulations containing the specific rules on the Regional Development Fund and the Social Fund are decided according to the co-decision procedure which gives the European Parliament considerably more influence. In addition, the European Parliament can influence the means of the structural funds when deciding the annual budget of the EU.

3 See the delegation provision in Article 10(3) of Council Regulation 1260/1999.

4 See especially the influential volume edited by Hooghe (1996a), in which all contributions use the combination of the multi-level governance model and the policy network approach. But see also Marks (1992); Smith (1997); Lawrence (2000); and Bache (1999).

5 For good reviews of the principal–agent perspective, see Moe (1984); Kiewiet and McCubbins (1991: ch. 2); and Huber and Shipan (2000). For an introduction with a special relevance to the EU, see Kassim and Menon (2003).

6 For full documentation of this study, see Blom-Hansen (2003).

7 See the website of the Danish Urban project: http://www.urbanbydel.dk/

8 Table 2 contains Danish cities with urban problems which the local municipality has found to be so serious that it has asked for national funding to solve them. The cities have been identified by studying the applications for the first round of projects under the national Neighbourhood Lift programme, which the Ministry of Housing initiated in 1996. The table contains all the cities which applied under this programme. The table may thus be considered a reasonably comprehensive list of Danish cities with urban problems of some magnitude. As can be seen, the table comprises fifteen cities. Note that among them is Aarhus whose application covered part of the current EU urban area of Gellerup-Hasle-Herredsvang. The Ministry of Housing could only meet six of the applications, but the table shows that most of the remaining cities succeeded in obtaining other kinds of national funding of their projects.