How can Europe boost its competitiveness while ensuring that every region and community benefits from prosperity? Kata Tüttő, President of the European Committee of the Regions, shares her perspective on the role of Cohesion Policy, social investment and local leadership in shaping Europe’s future.
How could a budget designed to make Europe more competitive also make it more fragile?
The risk is that public investment reinforces the concentration already happening in the private economy. Strengthening the single market is essential. But removing barriers does not give every region the same capacity to benefit. Investment can concentrate further in large cities and strong economic centres, where capital, research and skilled workers are already clustered. If EU funding increasingly follows the same geography, public and private money will pull opportunities towards the same places. Meanwhile, placing cohesion investment in national plans alongside agriculture and other priorities risks weakening the instrument designed to build productive capacity across Europe. Regions undergoing difficult transitions could lose investment precisely when they need it most. The consequences are economic and political. We leave capabilities underused, widen inequalities and give more communities reason to doubt that European integration offers them a future. For European Socialists, this is the central issue: competitiveness must widen participation in prosperity. The “do no harm to cohesion” principle becomes meaningless if the investment architecture itself deepens territorial divides. Europe needs stronger industries and technological breakthroughs. It also needs a budget that connects them to businesses, workers and communities across the Union
Why are decentralised and strengthened Cohesion Policy and local leadership essential to making the Right to Stay real?
The Right to Stay means having a real choice to build your future where you feel at home. That requires jobs, affordable housing, public services and connections. A strategy cannot deliver these without investment and the power to shape it locally. Yet the proposed budget risks moving investment decisions towards national capitals and Brussels, bypassing local and regional leaders. Local and regional government enjoys higher public trust than national government or the EU. Excluding it weakens both the quality of investment decisions and Europe’s connection to citizens. Local leaders know how challenges interact: a factory closure affects suppliers, municipal finances and young people’s prospects; a housing shortage can prevent firms from recruiting. Separate sectoral priorities cannot replace an integrated response built around a place. We need a strong European Cohesion Policy supporting the transitions of all regions, with predictable allocations and genuine local and regional decision-making powers. Shared competitiveness means connecting Europe’s different capabilities and enabling more places to develop them. Without that investment, the Right to Stay risks becoming an empty promise: telling people they should have a choice while removing the means to make it possible.
Who pays for the shift towards defence and competitiveness?
New priorities need funding. Without a matching increase in resources, financing them means taking money from somewhere else. We must make that redistribution visible. The proposed budget risks shifting investment away from people and towards selected sectors and technological centres. Folding social funding into national plans also puts it into competition with agriculture, infrastructure and other priorities. Social commitments become easier to displace when their resources are no longer clearly protected. The price would be concrete: fewer opportunities for workers to retrain, less support for social inclusion, and weaker capacity to invest in childcare, affordable housing and public services. Workers facing restructuring, low-income families and communities with limited resources would carry the greatest burden. Defence and innovation are necessary. But care, skills, housing and social security also sustain Europe’s economy and resilience. Weakening them can undermine the competitiveness we are trying to build. We should insist on a transparent account of what each new priority displaces. Shared prosperity cannot survive as a slogan while the investment that makes it possible is reduced.
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Photo credit article © European Union / Fred Guerdin