Completing the framework: the role of the EU and the functionalisation of regional

In the previous section, we have used the term “dirigisme” to describe a particular attitude shown by regional policy-makers, who hold necessary to force the territory by changing entrepreneurs’ mentality and by orienting academic research. We have also seen that this attitude is somehow justified with the competitiveness imperative, and is nourished by a constant comparison with other EU regions (the latter being also based also on direct experiences, acquired through frequent travelling abroad⁸², especially in the context of EU-funded trans-regional networks).

Such an attitude is then coupled, in the field of development policy, with a distinctive

“policy method”, which seems to have been lately emerging (also) as a response to the shortcomings of the previous programming period. The “method” has been plainly enunciated by our high official, who has termed it “selectivity”, but it can be detected in other actors’

accounts as well. In short, “selectivity” consists in the idea that, if Tuscany is to become more innovative, it is necessary to concentrate resources on few dynamic subjects which can assure effective absorption of funds and visibility of results. Within this framework, decisions should be taken by Regional Authorities on the basis of direct relationship with firms (thus bypassing intermediaries, in primis business associations).

“Regional development policies are intentional and selective. That means that, if there is a precise objective, this has to be pursued at any cost; it makes no sense that this objective is then diluted with a series of other incoherent targets. There is a contradiction here: the European Commission wants competitiveness and wants consensus, and then it wants also Gothenburg, Equal Opportunities, attention to peripheral areas, and so on.

[…] My problem is to find those who have the strength to propose a vision. Now, we are supporting those who are lagging behind; but we are not the primary school, we cannot help the last. If the last is helped, this represents a diseconomy, and it has to get out from the market. The problem of Tuscany is a structural development lag and, paradoxically, it is precisely in this situation that we need to be even more selective. […] That’s why we agree with the Commission’s approach: in Tuscany, we do not need anymore investments in factory sheds and machineries … we need investments in innovation and R&D.

[…] It is true that business associations have a “representativeness” problem and that we are relating directly to firms. During last months, a lot of medium and large companies has asked us to be accompanied in their investment plan. They come here, present their

82 During interviews, policy-makers have frequently made reference to best-practices, that they have personally observed in their travels abroad.

industrial plan and ask to be supported through our call for proposals. Our job is changing: we are becoming a development agency” (DGDO 08/06/09, emphasis added)

“In forthcoming innovation programmes, it would be opportune to introduce a “fast track”

option, namely a mechanism to offer specific assistance and support to most dynamic and innovative projects” (PO1 08/05/09).

Recapitulating, “selectivity” appears fully consistent with “dirigisme”: Regional Authorities take the lead of industrial and cultural transformation, by staking available resources on few allegedly high-growth sectors, or on few “regional champions”. Concretely, this entails that Regional Authorities turn into a sort of merchant bank, which reviews and decides to finance firms’ business plans, according to quite unfathomable criteria.

This scheme is obviously censored by the representative of the SMEs association, who sees in that a strategy to deprive associations of their function. However, she also draws attention to the potential distortions that this approach involves:

“Regional Authorities have been trying for some years now to relate directly to the entrepreneurial world. Now, we question whether this strategy is worthwhile first of all for Regional Authorities. […] Our organisation represents about twenty thousand firms: we are a complex organisation, but we have got tools to formulate mediated and shared positions. […] If Regional Authorities speak just with five firms, they will just receive five opinions, but they have no evidence that those five opinions are widespread” (Simoncini 12/06/09).

The idea of “selectivity” is certainly grounded on some contextual and historical factors:

Tuscany, and more generally Italy, have a long tradition of financial incentives distributed to firms indiscriminately. In this sense, selectivity represents a reaction to this phenomenon. On the other hand, concentrating resources on subjects who assure funds absorption is also fully coherent with the logic which governs the allocation of SF from the EU to the regional level. In other words, the objective of maximising the amount of Funds coming from Brussels has to be considered to comprehend policy-makers’ priorities; as one of the policy-officers has explained:

“During VINCI, like during all the programmes funded under the SF, attention has been too concentrated on the initial phase, namely on the moment in which we commit EU funds. That’s wrong: attention should shift towards the concluding phase, when you have to take stock of your and others’ work. Unfortunately, this is hampered by the fact that we have to spend everything within the time limits set by the Commission. That’s why for us the most important thing becomes spending: spending as much as possible, as quickly as possible, otherwise the Commission could withdraw the present financing and reduce future ones” (PO2 13/05/09, emphasis added)⁸³.

83 The point has been stressed by the Regional Councillor as well: “during the latest negotiation with the Commission, we managed to secure almost the same amount of Funds as for the previous programming period; this despite the fact that the total resources available to Italy have shrunk due to the EU enlargement. We succeeded in that because in the past programming period we effectively committed all our resources. That’s why I’m asking entrepreneurs and organisations to increase their efforts on the innovation issues” (Brenna 30/04/09).

To grasp the sense of previous quotations, we have to recall the importance of the

“absorption capacity” principle (see sec. 2.3.2), which, along with the “additionality” one, modulates the amount of resources allocated to each region during each programming period, and which basically consists in the following idea: the more you manage to absorb (spend) now, the more you will get in the future. Therefore, “absorption capacity”, SF regulations (which only allow for investments in innovation and R&D), Commission’s indications for networking strategy, benchmarking procedures, all these elements are needed to account for policy-makers’ pressing necessity to find firms or organisations which promptly respond to Regional Authorities’ calls. The problem is that this very mechanism seems to contribute to determining certain shortcomings of the policy. In this sense, Simoncini reasons that:

“It was surely necessary to introduce stricter selection criteria and to concentrate resources. At the beginning, there was a flood of projects, and the great majority of them was really low value. And I must admit that business associations benefited in part from that chaotic situation. The problem is that now Regional Authorities are not selecting on the basis of real firms’ needs, but rather on the participants’ ability to draw up projects which are formally exemplary, but which are totally disconnected from regional economic reality, and consequently do not have any triggering effect. The final result is that Regional Authorities have subsidized a series of technology-transfer structures, organisations and firms which are totally dependent on public contribution to survive, as they have no market perspectives.

[…] Regional innovation programmes are written in a very complicated language, often derived from EU indications, which is very difficult to understand in its real meaning. The Virtual Enterprise model proposed by VINCI is a good example of this jargon. Now, paradoxically, in front of very complicated call for proposals, it gets incredibly easy to write projects: you just need to use the same terminology. If I just want to open an ice-cream shop, but I tell you that I’ll do it in accordance with the Virtual Enterprise model and I use the same technical elements to describe it, you have no or few elements to say that I’m cheating” (Simoncini 12/06/09, emphasis added).

Here we have to slow down, as we are passing through a crucial point. Simoncini’s analysis is certainly influenced by a polemic spirit; however, it wholly resonates with policy-officers’ own accounts (see sec. 3.5.2). More precisely, it helps comprehend better one of the most significant finding we have come across at the beginning of the empirical investigation, that is the development of a sterile technology-transfer industry, which now appears as the coherent result of precise political priorities, and consistent with a procedural mechanism which favours formal correctness over feasibility. What is more, the problem of the “language”

of call for proposals is confirmed by one of the policy-officer: “the complexity of calls and SF regulation does not help, does not encourage a wide participation to these programmes” (PO2

13/07/09).

Therefore, the impression one derives from the previous discussion is that the system of incentives and constraints designed by the EU causes a real overturning of the bottom-up logic at regional level: instead of starting form a discussed and participated diagnosis of local needs to subsequently formulate a strategy, the strategy comes first and the local context is then demanded to adapt to it; or viewed from another angle, if the strategy has proved to be -

on average - unsuccessful, it is not the strategy which has to be changed, but the participants.

This reversal, that we have already detected in relation to the formulation process of VINCI, emerges thus as a fundamental characteristic of the overall regional policy-making. From a political point of view, the reversal is determined by the necessity of securing a stable funding stream. Conceptually, it is justified by the dominance of new regionalist theorisations. Finally, in procedural terms, it is favoured by a mechanism which grants funds on the basis of the degree of compliance of regional programmes with the Commission’s imperatives.

The significance of this process is then strengthened by the fact that a regional development policy does not exist beyond the one implemented through SF. In fact, available regional resources (included national transfers) are all “added up” to those coming from Brussels, in order to activate the “multiplier” set by the “additionality principle” (see sec. 2.3.2);

in other words, the regional development policy is the regional innovation policy outlined in the Regional Operational Programme.

In addition to this, the Regional Authorities refer to the CP framework to block requests from social partners (as for the demand for support to productive investments) or to force certain changes (as for the regional law on research). In other words, the CP framework represents an important element around which Regional Authorities are re-defining the contours of regional governance (that is the set of actors, relations, interests and daily practices which are involved in formulation/delivery of the development policy) by means of changes to the politics of development (that is the set of rules, procedures, “consented” issues which governance hinges upon). We are not in a position to say whether the CP framework is exploited by Regional Authorities to achieve their ends, or it is rather experienced by Regional Authorities passively as a necessary constraint. What is sure is the CP mechanics enhances the development of an asymmetry among regional actors, insofar as it assigns an exclusive role of interface to Regional Authorities vis-à-vis the Commission, thus making them a powerful gatekeeper:

“I have given up attending the meetings of the Managing Authority, because it is pointless. There is not any possibility to intervene on the content of the POR: any change you suggest is immediately rejected by the Regional Government’s staff, on the grounds that if they accepted it, they would lose the EU funding. They also say that the meetings of the Managing Authority are not the suitable place to raise problems, because we have to present ourselves united and in agreement vis-à-vis the Commission and representatives of national government. Then I ask: ‘please, tell me where is the place in which I can advance my proposals and my doubts’. But I haven’t got any answer so far.

Sometimes you really have the feeling that this is a strategy to cut you off: for instance, they use to send you an updated version of the POR just the night before the meeting.

The morning after you find out that the update concerns precisely issues which matter to you. […]. The point is that it has not always been like this. In the past, they used to consult us well in advance of the meeting; we tried to find a common position and then, on the day of the meeting, we all played the part pretending to be great friends. I can’t say precisely why this change happened; what I know is that this has happened since the Managing Authority has acquired important decisional powers. In fact, in the past it had a merely formal role” (Simoncini 12/06/09).

This passage thus confirms also the last hypothesis that we have advanced at the end of previous chapter: the architecture of the CP induces a sort of “functionalisation” of consensus at regional level that, in the name of Structural Funds, restrains dissent and narrows the room for discussion of alternatives. In other words, by setting consensus as a condition for funding, and by assigning Regional Authorities the role of sole gatekeeper, the CP favours a compression of the intrinsically heterogeneous and conflictual nature of the politics of local development, since it allows regional authorities to use “the cost of losing EU funds” as a pretext to impose their agenda on other stakeholders

Recapitulating, previous observations lead to stressing the role of the EU framework in our case-study, which cannot be interpreted in terms of mere moral suasion: in fact, the EU framework impacts on the system of relations at local level, by modifying the traditional rapport between politics and territory (an aspect which is perhaps a bit overlooked in literature):

“I think that regional government’s stress on high-tech and networking is something which derives from the EU. But this is a supposition of mine. Indeed, because of the SF system, it is more and more difficult to distinguish what Regional Authorities do decide from what they cannot decide because they have to comply with the Commission’s indications to secure the Funds. In other words, it is difficult to understand whether the Commission is an alibi or a cage. And you see that it makes a huge difference to me whether I have to orientate my action towards the Regional Authorities or towards the Commission, for in the latter case my capacity of intervening is fairly restricted” (Simoncini 12/06/09, emphasis added).

This last quotation contains two important aspects to reflect on. First, it better clarifies the sense of the asymmetry between the Regional Authorities and business associations: the power imbalance is clearly expressed by an information gap which is related to different nodal positions the two actors hold. However, the asymmetry has also a clear spatial connotation:

while the Regional Authorities can “freely move” from the regional to the EU level, that is they can adopt “transcalar strategies”, the business association is somehow “confined” to the regional level, and is consequently unable to equilibrate the bargaining power.

Second, the quotation discloses one of the implicit question which has led this inquiry -

“who decides what” - leaving it answerless. However, all the previous quotations, and especially the contradictions we have come across, suggest that, maybe, there is not even a definitive answer. And, maybe, this is a very finding of the present work.

I complete hereafter one of the first quotations with which the inquiry started:

“The money we used to make this programme was not ours, but it came from the EU and consequently we had to comply with the EU regulations. That implies that you are not wholly free when you write or implement the programme. We had to take in account a long series of constraints. But that’s normal. I cannot write something which is not in line with the POR, with the PRSE, and then these are in their turn influenced by national guidelines, by EU guidelines, the Lisbon Agenda, etc.” (PO1 08/05/09).

This quotation can be easily verified by going through the programming documents. As much as fifty pages (out of 180) of the POR are dedicated to describing the “coherence frameworks” with other programming documents. It emerges that the POR is strongly based on the PRSE which draws in turn on the Regional Government Plan. Both the POR and the PRSE are then said to be coherent with the EU Guidelines on Cohesion, but they are also consistent with the National Strategic Framework, which in its turn reflects the EU Guidelines.

The EU Guidelines are than based - as we have seen - on the Community Strategy for Growth. At the same time, the POR takes also into account indications from Gothenburg Agenda; but it is also consistent with other regional sectoral programmes (such as on transports, energy, etc.) which mirror in their turn EU indications. Moreover, the POR is also the result of Concertazione processes at regional level, which are in their turn articulated on two levels: social partners and other institutional and governance tiers.

So, the possibility of clearly defining “who decides what” and which interests really matter fades away within this striking series of crossed references, and procedural interdependencies. This is true for the external observer but, as we have seen, for the actors too. And this happens also because the CP has expanded the space of local development politics, by bringing in the decisional process new actors (the Guidelines, SF regulations, etc), new places (trans-regional networks), and new relational dimensions (and asymmetries) which have not a direct territorial relation with the object (the territory) of the politics, and which cannot be ascribed to a specific scale either.

Probably, this process is neither intrinsically positive nor negative: after all, policy-makers stress the role played by the EU in “opening their mind”. The problem lies rather in formulating new conceptual categories and (again) new procedures, to avoid the risk that a decrease in the accountability of political processes occurs as a result of the detachment between territory and polity (we will come back on this point in the next chapter).

To sum up, we have seen that many of the problematic aspects which characterised VINCI, also characterise the broader regional development policy, the two being both inscribed in the same policy field created - or at least strengthened - by the architecture of the CP. In this sense, this and previous sections have shown that the EU and the European Commission are important actors of the regional politics and governance of development.

Indeed, they can influence the content of local strategy, and, by changing the rules of game, they can asymmetrically enlarge or restrict the field of opportunities of different regional actors.

The EU-related intermediaries which affect the course of action at the regional level are

The EU-related intermediaries which affect the course of action at the regional level are