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  • 1 Bruegel Brussels Belgium
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The EU budget review, launched by the Commission in 2007, is a unique opportunity to critically examine EU policies and instruments. Structural Funds are at the heart of the EU’s cohesion efforts, and amount to almost one-third of the Community’s budget. They have two declared objectives, economic growth and regional convergence, but these do not always complement each other. The allocation of the Structural Funds is not efficient from a pure growth standpoint, and a large proportion of transfers takes place within regions. With enlargement, cross-country transfers increased significantly to 40% of total flows, and intra-regional redistribution decreased. In a more diverse EU, this is a step to the right direction. Yet, almost three-quarters of intra-country redistribution still happens within regions.

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