Jaume Garau Taberner
Félix Pablo Pindado
THE FISCAL
BALANCE OF
STATELESS
NATIONS
WITH THE EUROPEAN UNION
The cases of Aragon, Scotland, the Basque Country,
Flanders, Galicia, Wales and Catalonia,
Valencia and the Balearic Islands
Brussels
CMC PAPERS | 2014 | 1
THE FISCAL BALANCE
OF STATELESS NATIONS
WITH THE EUROPEAN UNION
The cases of Aragon, Scotland, the Basque Country,
Flanders, Galicia, Wales and Catalonia,
Valencia and the Balearic Islands
Jaume Garau Taberner
Félix Pablo Pindado
Centre Maurice Coppieters
CMC papers I 2014 I 1
summary
Prologue
5
Introduction
7
1. Contributions and transfers from Member States to the EU budgets
9
2. The regionalisation of these items 11
3. Results and comparisons between regions 14
An example of how to calculate the fiscal balance of a region with the EU
17
Conclusions
19
Bibliography
23
The Emili Darder Foundation
25
Centre Maurits Coppieters
29
Members of the CMC 32
Colophon 34
This publication is financed with the support of the European Parliament (EP).
The EP is not responsible for any use made of the content of this publication.
The editor of the publication is the sole person liable.
3
PROLOGUE
One of the major targets set by the European
Union was to combat inequality among different regions by means of the Cohesion Policies. Significant advances have been made
in this regard thanks to the large amounts
of resources invested. Unfortunately, these
resources have not always produced the best
results because of the regional redistribution
carried out by the Member States, which at
times apply discretional criteria and assign
the resources to their neediest regions.
The observation of these practices is what lies
behind this study, which by way of sampling
shows that the States thereby pervert the
Union’s philosophy, distorting the principles
of the above-mentioned Cohesion Policies.
The delicate economic situation that is shaking up countries in the Union, among other
circumstances, is causing the disaffection
of many people towards the EU institutions,
which are perceived as excessively distant and
bureaucratic. If in addition to this they are not
particularly careful or transparent in public
spending, popular disaffection will grow. We
should therefore clearly define the political
targets being pursued and check that they are
correctly applied.
The Emili Darder Foundation’s intention with
this study is not limited to exposing these
facts, but rather proposes the opening of a
process of reflection within the European
Union so that stricter and more objective criteria may be applied in the redistribution of
resources, and at the same time so that there
is a follow-up on the application thereof.
Pere Sampol i Mas,
Director of the Emili Darder Foundation
Antoni Marimón,
President of the Emili Darder Foundation
5
introduction
The social and economic situation of the 270
regions making up the European Union is very
unequal. London, Luxembourg and Brussels
are the areas with the highest wealth index
per capita. At the other end of the scale, the
regions of Severozapaden and Severen Tsentralen – both in Bulgaria – and the North-East
of Romania have the lowest wealth indices
in the entire EU. In other words: a resident of
London’s income is 13 times higher than that
of a resident of Severozapaden.
There are some cases of regions which have
the same per capita income and the same
population, however, they receive over three
times more European Funds investments than
others. In this case, the European Regional
Policy does not help to harmonise the differences, but rather increase them.
In order to reduce these significant regional
differences, the EU set up the so-called Cohesion Policy, the flagship instrument of its projects. The European Commission’s intention is
to drive more harmonious economic growth
among the different regions in Europe.
The purpose of this study is to analyse what
a series of regions receive in European Funds
and what they contribute – in tax – to the
European Union budget. The end target is to
come up with a new tool to better evaluate
the European Regional Policy and its effects.
In this way regions can access European
financing depending on the “category” of the
region in question. Areas whose GDP per capita is less than 75% of the EU average are the
main priority of the policy and they receive
the majority of resources. By way of contrast,
zones whose GDP per capita is over 90% of
the average receive less EU financing.
In order to carry out this research, first of all
we shall analyse what a series of European
regions receive in European Funds. In order
to do this, we have examined the transfers
received by said zones from different kinds of
existing funds.
Even though the distribution mechanisms of
European Funds are established by Brussels,
state governments have plenty of leeway to
decide how much of the European aid is in the
end assigned to each region within the state.
In other words, the governments in Madrid
and London, for example, enjoy significant
capacity to decide how much of the European
Funds goes to each region within the State.
This capacity held by the governments of
Member States can – at times – distort the
initial purpose of the Cohesion Policy. The
lack of transparency and clear criteria and targets about how European Funds are assigned
among the regions within a State often leads
to tension concerning the final sharing out
of EU aid among regions: paradoxes occur
6
in which areas with very similar per capita
income and populations receive very different
levels of European financing.
We then calculated the contributions that
these same regions make to the EU budget.
All regions in the EU contribute resources to
Brussels. Value Added Tax (VAT) is one of the
best-known contributions, but there are others too.
Finally, we assessed the difference between
what these regions contribute – in tax – and
what they receive – in European Funds. The
idea is to see if certain regions contribute
more tax to the EU than what they receive in
public investment, and whether this might
affect the initial purpose of reducing income
differences in the regions of Europe.
The research is focused on the cases of 26
European regions, which form part of three
Member States: Belgium, Spain and the United Kingdom. In these States there are regions
7
with their own powerful economic, social and
cultural characteristics, and this often leads
to political tension with the governments in
the capitals of said States. Our purpose in this
exercise is to determine whether these political situations might have affected the discretion of the governments when it comes to
assigning European financing to these politically differentiated regions. Table 1 shows
which regions come under analysis.
Finally, we would like to point out that the
results obtained are the fruit of our own meth-
odology, which has certain limitations: part of
the calculations carried out imply adopting
criteria to territorialise what is contributed
and what is received. The criteria adopted –
which are explained and justified – are always
subject to opinions and interpretation.
In short: this publication is a first approach to
try and calculate the fiscal balances of European regions with the EU. We will then have
a new instrument to assess the European
Regional Policy and its effects.
Table 1
regions in spain
regions in the united kingdom
Andalusia
aragon
Asturias
baleaRic islands
Canary islands
Cantabria
Castille and leon
Castille la mancha
catalonia
valencian communitiy
Extremadura
galicia
Madrid (region)
Murcia (region)
navarre
basque country
Rioja
Ceuta
Melilla
wales
scotland
northern ireland
England
regions in belgium
flanders
Wallonia
Brussels
NB: Regions considered “Stateless Nations”
or whose political and cultural identity is
quite different from that of the majority in
the State they belong to are shown in bold
and italics.
1. contributions and transfers from member states to the eu budgets
The resources that Member States contribute to the EU are basically divided up into 3
main items (cf. Las relaciones financieras entre
España y la Unión Europea, 2012):
• Traditional Own Resources (TOR)
Seen as the “real” European tax, the consequence of applying common policies
throughout the EU. TOR is made up of:
- Taxes, fees, supplementary or compensatory
amounts and additional elements, common
customs duties and other rights set by EU
institutions for trade with third countries.
- Contributions and other rights set forth with in the framework of the common organisation of markets in the sugar sector.
• Value Added Tax
Obtained by applying the tax uniformly to
all Member States. Part of what is collected
by each State under this tax is transferred to
the EU.
• Gross National Income
The more economic production a country
has, the more it contributes to the EU budget.
Given that EU budgets cannot have a deficit
when they are approved, the total amount
to pay for GNI is variable: once the total EU
expense and the total income from Traditional
Own Resources and VAT have been calculated,
each State has to make a further contribution
depending on its Gross National Income.
Table 2 - Contributions of each State to the EU budget (2011)
Belgium
Bulgaria
Czech Republic
Denmkark
Germany
Estonia
Ireland
Greece
Spain
France
Italy
Cyprus
Latvia
Lithuania
Luxemburg
Hungary
Malta
Netherlends
Austria
Poland
Portugal
Romania
Slovenia
Slovakia
Finland
Sweden
United Kindom
Total Member States
Traditional
VAT
GNI
CONTRIBUTION
CONTRIBUTION TO THE
TOTAL
own rescources
TO THE UKNETHERLANDS AND SWEDEN
1.581,00 516,52.627,30 177,5
24,2
4.926,50
49,1
51,2274,1 18,4
2,4
395,2
220,6
207,7
1.170,30
74,6
9,3
1.682,50
327,6
291,31.701,20 112,1
16,1
2.448,30
3.456,00 1.671,5017.610,40
218,3
170,9
23.127,10
21,9
22,9106,8
6
1
158,6
199,8 193,5884,4
52,7
8,3
1.338,70
141
278,61.376,10
93,1
14,2
1.903,00
1.170,20 1.964,407.355,00
487,7
69
11.046,30
1.566,30
2.917,6014.035,00
965,9
133
19.617,80
1.741,70
1.811,8011.703,30
717,9
103,1
16.077,80
24,6
27123,5 8,5
1,2
184,8
22,6
15,9133,6
9
1,2
182,3
44,6 27,9213,7
14
1,8
302
14,3 46,7215
15
2,1
293,1
101
116,6666,4
47
6,4
937,4
10,1 9,543,6 2,9
0,4
66,5
1.935,60 290,34.217,20
50,7
-625
5.868,80
189,5
306,12.150,00
24
19,1
2.688,70
352,6
5272.494,60 182,7
23,5
3.580,40
135
299,31.207,70
81,6
10,8
1.734,40
109,9 138,8902,1
66,9
8,2
1.225,90
74,2
54,7251,9 17,9
2,4
401,1
117,4 60474,9 36,9
4,5
693,7
152,4
266,91.436,20
87
12,6
1.955,10
466,9
173,12.798,90
33
-138,3
3.333,60
2.551,80
2.512,10
12.241,00
-3.595,90
116,2
13.825,20
16.777,70
14.798,90
88.414,20
5,4
-1,4
119.994,80
Source: Eurostat
8
9
This means that if, for example, the income
obtained by the EU from TOR and VAT is lower
than planned, governments will have to pay
more according to their Gross National Income.
This means that the EU budget is balanced.
Finally, each State makes an “extra” contribution to the United Kingdom, the Netherlands
and Sweden. There is a political agreement
to correct any budgetary imbalance these
countries may have: they were net contributors to the EU budget and by means of these
exceptional and temporary clauses, this state
of imbalance is reduced.
Altogether, the contributions from the 27
Member States to the EU budget for 2011
amounted to 119,000 million Euros. The country that contributed most was Germany (it is
the main economic power and has the highest population): it contributed over 23,000
million Euros, 19% of the whole EU budget.
At the other end of the scale, Malta (the least
populated country in the EU), contributed
67 million Euros to Union accounts. Table 2
shows the contribution of each State to the
EU in accordance with the different budgetary items.
As far as income is concerned, the transfers
that each State receives from the EU come, in
general terms, from the following six items:
• European Agricultural Guarantee Fund
(EAGF) Finances returns for the exportation of agricultural products to third parties,
interventions to restore agricultural mar-
kets, direct payments to farmers, etc.
• European Agricultural Fund for Rural
Development (EAFRD) Finances rural development and support programmes for farmers in European regions.
• European Fisheries Fund (EFF) Finances
projects related to all fishing and aquaculture sectors.
• European Social Fund (ESF) Finances
human resources training: the unemployed,
the working population and disadvantaged
groups.
• European Regional Development Fund
(ERDF) Finances projects and investment for
structural development and adaptation for
regional economies. The ERDF intervenes by
means of projects in research, the information society, transport infrastructures, culture, tourism, etc.
• Cohesion Funds Finances projects in the
fields of the environment and trans-European transport networks.
Not all the States have access to the same
investment: for example, those which are
more developed do not enjoy access to Cohesion Funds. Moreover, we should bear in mind
that the major part of these payments is made
through only three programmes - ERDF, ESF
and EAFRD.
2. the regionalisation of these items
Once the contributions and transfers from the
Member States to the EU budget are known,
these items are territorialised. In other words,
each region is assigned a figure for what it
is estimated to have contributed via the different taxes and for what it has received
through the different European investment
programmes.
In the case of contributions to the EU budget,
two different criteria were used for regionalisation, depending on the kind of item in question.
In order to estimate the contributions made
by a region in accordance with Traditional
Own Resources and VAT, we used home consumption data for each region. Hence we
assume that if, for example, homes in the
region of England (United Kingdom) show a
high level of consumption, they will contrib-
ANDALUSIA15,46%
ARAGON2,98%
ASTURIAS 2,35%
BALEACIC ISLANDS 3,58%
CANARY ISLANDS
5,11%
CANTABRIA1,32%
CASTILLE AND LEON
5,34%
CASTILLE LA MANCHA
3,87%
CATALONIA17,21%
VALENCIAN COMMUNITIY
10,13%
EXTREMADURA1,93%
GALICIA5,65%
MADRID (REGION)
14,98%
MURCIA (REGION)
2,63%
NAVARRE 1,48%
BASQUE COUNTRY
5,06%
RIOJA 0,69%
CEUTA 0,13%
MELILLA 0,11%
Total Consumption expenditure of households in Spain
610.535.000
The transfers received from European funds
in the three States we have analysed for this
study (Belgium, Spain and the United Kingdom) are shown in Table 3 for the period
2007-2013.
2007-2013 period
Per year
Belgium1.831,3261,6
Spain
44.401,96.343,1
United Kingdom14.019,8
2.002,8
10
NB: Corresponds to the European Commission’s financial commitments to these regions
under the ERDF, ESF and EAFRD programmes.
Even so, it would have been better to take into
account the different rates of VAT (for each
product) and the specific taxes on imported
products. Nevertheless, as we used the same
criteria in all 27 regions studied, we understand that it is an acceptable approach1.
Secondly, State contributions have been
regionalised in accordance with Gross National Income. In order to do this we used the
Gross Domestic Product for each region. In
Table 4 - Home consumption by region compared to the total for the State it belongs to (2011)
Table 3 - Resources received within the framework of the ERDF, ESF and EAFRD programmes
(2007-2013)
Source: Drawn up in house based on financial
figures published on the European Commission web site.
ute more VAT to the EU budget. On the other
hand, if homes in the region of Extremadura
(Spain) show a low level of consumption, this
region will contribute less to EU accounts
under this concept. In other words, to estimate
what regions contribute according to VAT and
products purchased abroad, we used what
families consume. This seemed to be the best
method for regionalising this item (Table 4).
FLANDERS35,3%
WALLONIA33,1%
BRUXELLES31,6%
Total Consumption expenditure of households in Belgium
n.a.
WALES4,1%
SCOTLAND8,4%
NORTHERN IRELAND 2,9%
ENGLAND84,6%
Total Consumption expenditure of households in UK
12.304.098
Source: Drawn up in house based on data
from “Statistics Belgium”, the “Instituto
Nacional de Estadística” and the “Office for
National Statistics”. NB: In the case of Spain,
VAT has been reweighted on a regional basis
in accordance with information from the INE
(National Statistics Institute).
Furthermore, in Spain there was an additional distribution that combines the VAT regionalisation indicators
published by the INE for regions that do not have a local Inland Revenue and the Canary Islands, and the actual
expense structure in final home consumption.
1
11
Once the regionalisation of payments made
has been taken into account, we can estimate
169,9 184,3
174,3
186,3
196,3
188,5
196,6
213,7
202,7
219,4
214,2
226,0
223,0
235,2
231,0
261,7
238,3
262,8
283,7
274,1
297,7
295,1
1.054,3
374,6
Graph 1 shows contributions to the EU budget per inhabitant, according to the region
they live in. Regions with a higher GDP per
capita contribute more: Brussels, Flanders,
the Basque Country, Madrid, etc. Even so, we
could highlight the fact that there are regions
with income rates under the European average that make additional contributions to the
EU budget, such as Wallonia and the Balearic
Islands.
Graph 1 - Contribution to the EU budget per inhabitant and by region (2011)
303,5
In this case we applied regional GDP distribution structure data (SEC 95), which is the same
for countries and regions. Table 5 shows the
GDP for each region as a proportion in each
State.
what each region contributes to the budget
of the European Institutions. Table 6 shows all
these payments.
384,0
other words, we assumed that the region with
the highest total production would contribute the most to European budgets. This is the
same criteria applied to States when calculating their contribution to Brussels, hence it is
considered to be the best criteria for regionalisation.
We then calculated the transfers received by
Source: Drawn up in house based on calculations explained above (Tables 3 and 4)
Table 5 - GDP for each region, compared
to the total for each State (2011)
Table 6 - Payments made by each region
to the EU (TOR+VAT+GNI)
FLANDERS212.354
WALLONIA86.767
BRUXELLES69.895
Belgium369.259
ANDALUSIA141.603
ARAGON33.307
ASTURIAS 22.472
BALEACIC ISLANDS 25.968
CANARY ISLANDS
40.718
CANTABRIA12.754
CASTILLE AND LEON
55.331
CASTILLE LA MANCHA
37.113
CATALONIA194.285
VALENCIAN COMMUNITIY
99.372
EXTREMADURA16.954
GALICIA55.940
MADRID (REGION)
188.445
MURCIA (REGION)
27.177
NAVARRE 18.144
BASQUE COUNTRY
64.857
RIOJA 7.986
CEUTA 1.499
MELILLA 1.338
Spain1.046.327
WALES60.428
SCOTLAND137.864
NORTHERN IRELAND 37.813
ENGLAND1.376.256
United Kingdom
1.612.361
FLANDERS2.369,3
VALONIA1.358,7
BRUXELLES1.198,5
Belgium
4.926,5
Source: Drawn up in house based on Eurostat
data. NB: The sum of the regional GDPs is not
exactly the same as that for each State, as we
should take the “Extra-Regional” GDP into
account, generated outside the State.
12
ANDALUSIA1.556,3
ARAGON345,5
ASTURIAS 243,9
BALEACIC ISLANDS 308,8
CANARY ISLANDS
468,4
CANTABRIA137,9
CASTILLE AND LEON
586,1
CASTILLE LA MANCHA
402,4
CATALONIA2.010,0
VALENCIAN COMMUNITIY
1.069,7
EXTREMADURA188,8
GALICIA600,4
MADRID (REGION)
1.895,8
MURCIA (REGION)
288,2
NAVARRE 183,6
BASQUE COUNTRY
649,6
RIOJA 81,9
CEUTA 15,4
MELILLA 13,7
Spain
11.046,3
WALES511,5
SCOTLAND1.122,0
NORTHERN IRELAND 335,9
ENGLAND11.855,7
United Kingdom
13.825,1
Source: Drawn up in house based on calculations explained above (Tables 4 and 5)
each region under the different programmes
in the European Regional Policy. As explained
above, most Community Funds come in the
form of ERDF, ESF and EAFRD. Most regions
analysed do not have access to EFF or Cohesion Funds. EAGF is a very specific fund
derived from the Common Agricultural Policy
and which we decided not to territorialise:
EAGF is not an investment for the economic
development of a region, but rather consists
of interventions to regularise agricultural
markets and make direct payments to farmers, set up within the field of the CAP.
Consequently, we respected the territorial
assignation of each commitment to credit set
up by the European Commission in the 3
ERDF, ESF and EAFRD funds. The amounts
received by the 26 regions under study are
shown in Table 7.
Graph 2 shows which regions receive most
European financing per capita.
Once we had estimated what each region
contributes to and receives from the European budgets, it is important to point out
that the calculations of income and expenses
are asymmetrical: while regionalisation for
Table 7 - European Commission
commitments to the regions analysed
(ERDF, ESF and EAFRD funds) (2011)
FLANDERS127,76
VALONIA68,09
BRUXELLES65,77
ANDALUSIA1.572,3
ARAGON91,7
ASTURIAS 118,7
BALEACIC ISLANDS 28,0
CANARY ISLANDS
187,6
CANTABRIA27,5
CASTILLE AND LEON
239,0
CASTILLE LA MANCHA
372,2
CATALONIA181,4
VALENCIAN COMMUNITIY
245,7
EXTREMADURA407,9
GALICIA563,9
MADRID (REGION)
95,1
MURCIA (REGION)
118,3
NAVARRE 25,6
BASQUE COUNTRY
62,3
RIOJA 14,1
CEUTA 8,0
MELILLA 7,3
WALES360,61
SCOTLAND213,75
NORTHERN IRELAND 48,11
ENGLAND1.380,36
Source: Drawn up in house based on data
from the European Commission.
13
Graph 3 - Fiscal balance with the EU, in relation to GDP
EXTREMADURA
GALICIA
0,01%
ANDALUSIA
CASTILLE LA MANCHA
-0,07%
WALES
-0,08%
MELILA
-0,25%
CEUTA
MURCIA
-0,47%
CASTILLE AND LEON
-0,63%
ASTURIAS
SCOTLAND
-0,63%
-0,49%
CANARY ISLANDS
-0,66%
-0,56%
ENGLAND
VALENCIAN COMMUNITY
-0,69%
RIOJA
-0,83%
NORTHERN IRELAND
CANTABRIA
-0,85%
-0,70%
NAVARRE
-0,87%
ARAGON
BASQUE COUNTRY
-0,87%
-0,76%
CATALONIA
-0,91%
-0,76%
MADRID (REGION)
-0,94%
FLANDERS
-0,96%
BALEARIC ISLANDS
-1,06%
WALLONIA
BRUXELLES
-1,08%
-1,49%
-1,62%
19,2
14,9
24,7
20,2
26,3
25,7
26,7
40,8
29,1
41,2
47,6
44,9
57,9
49,1
80,5
69,8
95,9
89,3
105,1
98,7
119,8
112,5
190,4
181,8
206,0
376,5
1,29%
Graph 2 - EU financing per inhabitant
Source: Drawn up in house
Source: Drawn up in house based on calculations explained above (Tables 3 and 4)
expenses was complete, in income part of the
European investment could not be regionalised. The reason is that not all European
investment is assigned to a specific region:
there are numerous “multiregional” programmes, i.e. programmes that are applied to
different regions at the same time. In such cases it is not easy to determine what is actually
invested in each region. Even so, it did prove
possible to regionalise most European investment: for example, in the case of Spain, 75%
of European investment made in the state is
specifically assigned to regions.
In any case, it is important to remember that
European investment in regions is not shown
in its entirety. This could lead to bias in the
calculation of fiscal balances: all payments
made to the EU are shown but not all European investment received is. However, given
that the same situation is applicable to all the
regions studied, we understand that the data
obtained is comparable.
3. results and comparisons between regions
Table 8 - Fiscal balance of regions with the EU
FLANDERS-2.241,6
VALONIA-1.290,6
BRUXELLES-1.132,7
ANDALUSIA15,9
ARAGON-253,8
ASTURIAS -125,1
BALEACIC ISLANDS -280,8
CANARY ISLANDS
-280,8
CANTABRIA-110,4
CASTILLE AND LEON
-347,0
CASTILLE LA MANCHA
-30,2
CATALONIA-1.828,6
VALENCIAN COMMUNITIY
-823,9
EXTREMADURA219,0
GALICIA-36,5
MADRID (REGION)
-1.800,8
MURCIA (REGION)
-170,0
NAVARRE -158,0
BASQUE COUNTRY
-587,2
RIOJA -67,9
CEUTA -7,4
MELILLA -6,3
WALES-150,9
SCOTLAND-908,3
NORTHERN IRELAND -287,8
ENGLAND-10.475,3
Source: Drawn up in house
Once the payments and investment for each
region in the study had been analysed, we
were able to calculate the fiscal balance with
the EU for a given region: payments made by
a region to the EU budget were subtracted
from the amount received. Table 8 shows the
results.
Of all the regions studied, Brussels, Wallonia
14
and the Balearic Islands have the worst fiscal balance in relation to their GDP (Graph 3).
Extremadura and Andalusia are the regions
with the most positive fiscal balance with the
EU.
The residents who contribute most and
receive least from the EU are those who live in
the regions of Brussels, Wallonia and Flanders
(Graph 4). At the other end of the scale, inhabitants of Extremadura and Andalusia are those
who pay least and receive most.
If we analyse the GDP per capita in each of
these regions, and what they receive in European Funds (Graph 5), it becomes clear that
there is a certain relationship between the
GDP per capita figures in a region and the
amount of European investment received
by that region: the higher the per capita
income in a region, the less European funds
it receives. Despite this general trend, certain
significant anomalies come to light: there are
regions that receive much more or much less
European investment than would be expected from their wealth per capita.
We can see on this graph that there are four
kinds of region, according to the amount of
European investment received:
• Regions that receive European financing
in relation to their wealth per capita: Flanders, Navarre, the Basque Country, Scotland,
Aragon, Castilla y León, Ceuta, Asturias,
Wales, Madrid, La Rioja, the Canary Islands,
Melilla and Murcia (the latter could also be
placed in the following group).
These regions are shown on the graph on
the diagonal dividing line.
• Regions that receive much less European
financing than would be expected from
their per capita income (in this order):
Northern Ireland, Wallonia, Valencia, the
Balearic Islands, Cantabria and Catalonia.
These regions are shown on the graph
under the diagonal dividing line (in the lower left corner).
• Regions that receive much more European
financing than would be expected from
their per capita income: Galicia, Castilla-La
15
GALICIA
EXTREMADURA
ANDALUSIA
1,9
202,2
CASTILLE LA MANCHA
-13,4
WALES
-14,8
MELILLA
-50,1
CEUTA
-85,6
MURCIA
-97,6
ASTURIAS
-115,8
NORTHERN IRELAND
CANARY ISLANDS
VALENCIAN COMMUNITY
-159,6
-118,5
SCOTLAND
-164,6
CASTILLE AND LEON
CANTABRIA
-173,4
-133,7
ARAGON
-190,7
-139,3
ENGLAND
CATALONIA
-193,0
NAVARRE
-249,3
RIOJA
BALEARIC ISLANDS
-253,9
-199,7
BASQUE COUNTRY
-258,0
-216,8
MADRID (REGION)
-274,4
FLANDERS
-282,7
WALLONIA
-354,4
BRUXELLES
-996,4
-364,8
Graph 4 - Fiscal balance with the EU per inhabitant
Mancha and Andalusia. These regions are
shown on the graph above the diagonal
dividing line (in the upper right corner).
• Regions that receive an extraordinarily higher level of European financing than would
be expected from their per capita income:
Extremadura and Brussels.
Even so, the region of Brussels is a special
case: it has the highest GDP per capita.
Even though it has the most negative fiscal balance in the EU, this means that it still
receives a “high” amount of European funds.
This is due to its extraordinarily high income
level. These regions are shown on the graph
well above the diagonal dividing line (above
the upper right corner).
A second reading of the graph shows how
regions with similar wealth levels receive
very dissimilar European financing. Northern
Ireland and Galicia enjoy a similar degree of
economic development, but the European
financing they receive is completely different: the former receives much less European
investment. The GDP per capita in the Balearic
Islands and Valencia is lower than in Aragon,
but the latter’s European financing per inhabitant is significantly higher.
Source: Drawn up in house
Graph 5 - Fiscal balance with the EU per inhabitant (The vertical axis shows European investment per inhabitant, the horizontal axis shows GDP per inhabitant)
An example of how to calculate the
fiscal balance of a region with the EU
If we take the Balearic Islands as an example,
we can see how we have calculated the fiscal
balance of a region with the EU Institutions.
First of all, we took the region’s income from
European programmes (Table 6): 27.96 million
Euros altogether per year.
As far as the region’s payments to the EU are
concerned, we regionalised two items: what
they have to pay under VAT and Own Resources and what they pay for their economic business activity (Contribution for Gross National
Income).
Source: Drawn up in house
NB 1: Data for Extremadura and Brussels has
not been included on the graph, as these
results – explained above in the text – would
distort the depiction.
NB 2: In order to draw up the graph, we used
a scale of 1 to 100 for all data. The axis show-
16
ing European investment per inhabitant goes
from 0 to 100. The region that receives most
investment (Extremadura; 3,765 €) is given a
value of 100 on this axis. The axis showing the
GDP per inhabitant also goes from 0 to 100.
The region with the highest per capita income
(Brussels; 61,485 €) is given a value of 100.
In order to regionalise the former component,
it will be seen that the proportional consumption in the Balearic Islands in relation to Spain
is 3.58%, i.e. 21,854,622 Euros.
The contribution for Gross National Income
was regionalised in accordance with the pro-
portion of the Balearic GDP in relation to
Spain: 25,968 million Euros.
When these two components are added
together, we obtain the sum of payments this
region is estimated to make to the EU: 308.8
million Euros.
If we subtract what the Balearic Islands contribute to the EU from what the EU invests in
the archipelago, the result is a negative balance of 280.8 million Euros for 2011.
This negative balance accounts for 1.08% of
the region’s GDP: one of the highest in all the
regions studied.
Each inhabitant on the Islands contributes
283 Euros to the EU budget while the EU
invests 26 Euros per inhabitant.
17
Conclusions
2014 is a particularly important year for the
European Regional Policy: one period of European Fund implementation is coming to an
end (2007-2013) and a new investment period (2014-2020) is being prepared. Now, therefore, is a good time to reflect on and assess
what has been done in the past in order to
reach conclusions for the future.
This study is a preliminary approach to try and
calculate regions’ fiscal balances with the EU.
The purpose is to come up with a new tool to
better evaluate the Regional Policy, one of the
European Commission’s major budget items.
There are two significant limitations to this
study. Firstly, in order to estimate what each
region contributes to the EU budget, we
territorialised these payments. This is unavoidably subject to different opinions and
interpretations. Secondly, we were not able
to territorialise all the EU investment items:
funds such as the EAGF and the Multiregional
Operating Programmes did not show all the
expenses and investment that the EU carries
out in a given region. Even so, we believe that
the results obtained are sufficiently sound
and that they enable us to make comparisons
between States and regions.
The results obtained show us how:
• In general terms, regions with a high wealth
index per capita are those that contribute
most to the budgets. At the same time,
regions with the lowest per capita income
are those that receive most investment from
the EU.
18
• Nevertheless, there are exceptions: Northern Ireland, Wallonia, Valencia, the Balearic
Islands and Catalonia have particularly
low European financing in relation to their
income and their fiscal balances are especially negative, if we take the degree of their
economic development into account.
• There are regions that receive especially
high levels of European financing, even
in relation to their relative poverty level.
Extremadura is the best example of this.
• Regions with very similar degrees of development receive very different European
financing.
• Five of the six European regions with the
lowest European financing in relation to
their income correspond to exceptional
political situations: the Catalan-speaking
Countries (i.e. Catalonia, Valencia and the
Balearic Islands) – with a different language
and culture from the majority of inhabitants
in the State - Northern Ireland and Wallonia.
Nevertheless, we cannot speak of the existence of a clear relationship between the
political status of a “Stateless Nation” and its
financial relationship with the EU.
At the same time as we establish financial
relationships between Member States and
the European Institutions, there are also economic and political criteria. The exception
clauses for Great Britain, the Netherlands and
Sweden are a clear example of a political decision. In these cases, the political decision is
expressly stated.
19
On the other hand, the political criteria for distributing European funds among the regions
within a State are not so clear. The situation
is relevant if we bear in mind that there are
anomalous situations: regions with very
similar income levels receive very different
amounts of European financing and have very
dissimilar fiscal balances with the EU.
In short, greater transparency is called for
in the Commission and in the governments
of Member States to make all the criteria for
assigning European financing better known
in European regions as a whole. We need
greater clarity in public accounts, especially
when there are signs that financial relationships between certain European regions and
the EU might be leading to the opposite effect
of the initial purpose of harmonising economic differences between regions.
20
21
Bibliography
European Commission
http://ec.europa.eu/
Dury, D., Eugène, B., Langenus, G., Van Cauter, K., Van Meensel, L. (2008)
Interregional transfers and solidarity mechanisms via the government budget
Economic Review - National Bank of Belgium
Eurostat
www.epp.eurostat.ec.europa.eu
Instituto Nacional de Estadística
www.ine.es
Las relaciones financieras entre España y la Unión Europea (2011)
Ministerio de Hacienda y Administraciones Públicas
Office for National Statistics
www.ons.gov.uk
Statistics Belgium
www.statbel.fgov.be
22
23
The emili darder
foundation
Since 1987, the Emili Darder Foundation has
been disseminating the life and thought
of the doctor and politician Emili Darder i
Cànaves, the Republican and progressive
Mayor of Palma, executed by the Fascists in
1937.
Darder today is one of the main symbols
of honesty, efficiency and commitment to
the social progress and self-government of
the Balearic Islands. He represents a clear
avant-garde in progressive thought and the
policies of public service, as he started up
various initiatives that even today are still
pioneer and surprisingly advanced for his
time.
For this reason, the Foundation promotes
public talks, conferences and other events
24
to promote the person of Darder, and the
values and ideals of political sovereignty,
Mallorquinism, social justice and ecology.
The Foundation aims to make a contribution
to the development of the political, social and
cultural thought of democratic nationalism
in the Balearic Islands and to increase the
training and knowledge of people in the
Islands.
As Emili Darder used to say, the fundamental
aspect of humanity is citizens, and there is
only one way to make citizens – through
culture. If everybody contributes, we can
keep working with the task started by Emili
Darder and build up peoples who are freer,
fairer, more sustainable and more solidaritybased.
25
The life of emili darder
Born in Palma (Mallorca) in 1895 into the
bosom of a well-to-do family, he obtained
a degree in Medicine and Surgery from the
University of Valencia and then his PhD in
Clinical Analysis in Madrid. Darder was an
outstanding and enthusiastic doctor who
devoted his time to fighting infectious
diseases, and in his awareness of the sanitary
conditions of the population in Mallorca, he
promoted social, preventive and didactic
medicine.
At the same time, his social, civic and cultural
activism led him to take part in numerous
popular initiatives: he promoted and chaired
the Cultural Association of Mallorca and was
one of the promoters of the Preliminary
Project for the Self-Governing Statute of the
Balearic Islands.
As a politician, he was voted City Councillor
of Palma for the Federal Republican Party of
Mallorca (1931), and set in motion a project
for building schools and the Municipal
Sanitary Service Plan. In 1934 he inspired the
foundation of the Balearic Republican Left, of
26
which he was one of the main leaders.
In 1933, he was appointed Mayor of Palma,
and was the driving force behind the water
supply and sanitary sewers for the whole
city, and the building of kindergartens and
schools: over the six years of the Second
Republic more schools were opened in Palma
than in the first twenty years of the Franco
dictatorship. He also kept working on the
renovation and improvement of the sanitary
services.
When the Fascist military uprising took place
(1936) he was arrested and locked up in the
Castle of Bellver. He was court-martialled,
condemned to death and shot by a firing
quad in the cemetery of Palma on 24 February
1937, even though he was already seriously ill.
He was 41 years old.
In 1994, on the proposal of the Socialist Party
of Mallorca, he was named an "Illustrious
Son" of Mallorca, an official ceremony
recognising his contribution to the city, by
the City Council of Palma.
27
Centre Maurits
Coppieters
The European Parliament recognized the
Centre Maurits Coppieters (CMC) as a Political Foundation at a European Level in 2007.
Since then the CMC has developed political
research focusing on European issues, also
in the fields of multilevel governance, management of cultural and linguistic diversity
in complex (multi-national) societies, decentralization, state and constitutional reform,
succession of states, conflict resolution and
protection of human rights.
So far, every little step has been important
to the steady consolidation and growth of
the Centre, that’s why I’m especially proud of
this publication. Indeed, it undoubtedly represents a crucial contribution to the current
state of affairs and will certainly have a significant impact both in the Academia and among
European decision makers in a broad sense,
including European Institutions (like the
European commission, European Parliament,
Council and Committee of the Regions), other political actors, think tanks, research centers and contributors to the European integration process.
On behalf of the Centre Maurits Coppieters
and our partners I sincerely wish to thank the
author of the report for his groundbreaking
approach to the subject and his passionate,
conceptually robust and well structured factual presentation.
Finally I also wish to thank you (the reader)
for your interest in our organization and for
reviewing our modest contribution to a much
wider European political debate in this area.
Günther Dauwen
Secretary of Centre Maurits Coppieters
www.ideasforeurope.eu
28
29
Goals of the European Political Foundation
CENTRE MAURITS COPPIETERS (CMC)
Maurits Coppieters
According to its general regulations, the Centre Maurits Coppieters asbl-vzw persues the
following objectives and references:
The Fleming Maurits Coppieters studied history and later became a Doctor of Laws and
obtained a master’s degree in East European
studies. During the Second World War, he
refused to work for the German occupier.
After many years as a teacher, he worked as a
lawyer for a while. He was one of the people
who re-established the Vlaamse Volksbeweging (Flemish People’s Movement), of which he
was the President from 1957-1963.
ww Observing, analysing and contributing
to the debate on European public policy
issues with a special focus on the role of
nationalist and regionalist movements and
the process of European integration;
ww Serving as framework for national or
regional think tanks, political foundations
and academics to work together at European level;
ww Gather and manage information for scientific purposes on all nationalist and regionalist movements, organisations, structures,… in all its appearances situated in a
European context;
ww Making available information to the public
on the implementation of the principle of
subsidiarity in a context of a Europe of the
Regions;
ww Promoting scientific research on the functioning and the history of all national and
regional movements in the EU and making
the results public to as many people as
possible;
30
ww Developing actions to open information
sources and historical information sources
in a structured and controlled way with the
aim to build a common data network on
issues of Nationalism and Regionalism in
Europe;
ww Maintaining contacts with all organisations
who are active in national movements and
with the Institutions of the EU;
The Centre Maurits Coppieters asbl-vzw
takes all the necessary actions to promote
and achieve the higher stated goals always
observing the principles on which the European Union is founded, namely the principles
of liberty, democracy, respect for human
rights and fundamental freedoms, and the
rule of law.
Coppieters’ political career began when he
became a member of the Flemish-nationalist
party Volksunie (VU) which was formed in
1954. With the exception of two years, Coppieters was a town councillor between 1964
and 1983. He was also elected as a member
of the Belgian Chamber (1965-1971) and Senate (1971-1979). At the same time, Coppieters
became President of the newly formed ‘Cultuurraad voor de Nederlandstalige Cultuurgemeenschap’ (Cultural Council for the Dutchspeaking Community, from which later the
Flemish Parliament emanated), when the VU
formed part of the government. In 1979, Coppieters was moreover elected during the first
direct elections for the European Parliament.
As a regionalist, he became a member of
the Group for Technical Coordination and
Defence of Independent Groupings and
Members in the European Parliament (TCDI).
Among other things, he made a name for
himself when he championed the cause of
the Corsicans. In the meantime, Coppieters
also played a pioneering role in the formation of the European Free Alliance, of which
he became the Honorary President and in
whose expansion he continued to play a role,
even after he said farewell to active politics in
1981. In 1996, Coppieters joined forces with
the president of the Flemish Parliament, Norbert De Batselier, to promote ‘Het Sienjaal’, a
project with a view to achieve political revival
beyond the party boundaries. Coppieters
died on November 11, 2005.
Among other things, Coppieters was the
author of: ‘Het jaar van de Klaproos’; ‘Ik was
een Europees Parlementslid’; ‘De Schone en het
Beest’. He is Honorary member of the EFA.
31
CMC MEMBRES
Arritti
5, Bd de Montera, 20200 BASTIA, Corsica
Member since 2008
www.p-n-c.eu
Fundación Alkartasuna Fundazioa
Portuetxe 23, 1º, 20018, Donostia/
San Sebastian, Euskadi
Member since 2008
www.alkartasunafundazioa.org
Fundació Emili Darder
Isidoro Antillon 9, Palma de Mallorca
Iles Baleares
Member since 2008
www.fundacioemilidarder.cat
Fundació Josep Irla
Calàbria 166, 08015 Barcelona, Catalunya
Member since 2008
www.irla.cat
Previous Centre Maurits Coppieters studies
Fundación Galiza Sempre
Av. Rodriguez de Viguri 16, Baixo 15702
Santiago de Compostela, Galicia
Member since 2008
www.galizasempre.org
Home of the Macedonian Culture
Stefanou Dragoumi 11, P.O. BOX 51,
53100 Florina
Member since 2008
Le Peuple Breton
Brittany
Member since 2013
www.peuplebreton.net
Welsh Nationalism Foundation
Wales
Member since 2008
www.welshnationalismfoundation.eu
Fundacion Aragonesista 29 de junio,
Conde de Aranda 14-16, 1°,
50003 Zaragoza, Aragon
Member since 2008
www.chunta.org/29j.php
Centre International Escarré per les
Minories Ètniques i les Nacions
C/Rocafort, 242, bis
08029 Barcelona, Catalunya
Member since 2011
www.ciemen.cat
32
CMC 2012 — The Ascent of Autonomous Nations 2nd edition The institutional
advantages of being an EU member state, by Matthew Bumford In a joint effort with the Welsh Nationalism Foundation
CMC 2012 — Variations autour du concept d’empreinte culturelle Définition
du concept et metodes de Mesure, by Elna Roig Madorran et Jordi Baltà
Potolés
CMC 2011 — Approaches to a cultural footprint Proposal for the concept and
ways to measure it, by Elna Roig Madorran and Jordi Baltà Potolés
CMC 2010 — The Internal Enlargement of the European Union 3rd edition
Analysis of the legal and political consequences in the event of secession or
dissolution of a Member State, by Jordi Matas, Alfonso Gonzalez, Jordi Jaria
and Laura Roman. In a joint effort with Fundació Josep Irla
CMC 2009 — Electoral contestability and the representation of regionalist
and nationalist parties in Europe, by Simon Toubeau
CMC 2008 — A different kind of kinetics Establishing a network of heritage
and research institutions for the (historical) study of national and regional
movements in Europe, by Luc Boeva
CMC 2013 | 2 — Globalism vs Internationalism
By Josep Bargallón Isidor Marí and Santiago Castellà
CMC 2013 | 1 — Law and Legitimacy: the denial of the Catalan voice
By Huw Evans
Associated members
Transylvanian Monitor
Str. J. Calvin 1, 410210 Oradea, Romania
Member since 2009
www.emnt.org
CMC 2012 — The Future of Europe An integrated youth approach
Previous Centre Maurits Coppieters policy papers
Kurdish Institute of Brussels
Rue Bonneelsstraat 16, 1210 Brussels
Member since 2010
www.kurdishinstitute.be
CMC 2013 — An alternative economic governance for the European Union
By Xavier Vence, Alberto Turnes and Alba Noguera
CMC 2012 | 3 — Making ideas spread New Media, Social Networks, Political
Communication, advocacy and campaigns, by Jorge Luis Salzedo Maldonado
Istituto Camillo Bellieni
Via Maddalena, 35
07100 Sassari
Member since 2012
www.istituto-bellieni.it
Free State of Rijeka Association
Užarska 2/3
51000 Rijeka – Fiume
Member since 2012
CMC 2012 | 2 — The size of states and Economic Performance in the
European Union, by Albert Castellanos i Maduell, Elisenda Paluzie I Hernàndez
and Daniel Tirado i Fabregat. In a joint effort with Fundació Josep Irla
CMC 2012 | 1 — 2014-2020 Un autre cadre financier pluriannuel pour une
nouvelle Europe: Pour une Europe des peuples, by Roccu Garoby. In a joint effort with Arritti
CMC 2011 | 3 — From Nations to Member States, by Lieven Tack, Alan Sandry
and Alfonso González
CMC 2011 | 2 — Diversité linguistique un défi pour l’Europe
CMC 2011 | 1 — Tourism and identity, by Marien André
In a joint effort with Fundació Josep Irla
CMC 2010 | 1 — Language Diversity a challenge for Europe
33
Colophon
CMC paperS | 2014 | 1
Editorial
Centre Maurits Coppieters (asbl-vzw), Boomkwekerijstraat 1, 1000 Brussels
www.ideasforeurope.eu
Publication date
2014
Publication series and number
CMC PaperS | 2014 | 1
Authors
Jaume Garau Taberner and Félix Pablo Pindado
Coordination
Ignasi Centelles
Editorial board
Xabier Macías
Günther Dauwen
José Miguel Marinez Tomey
Alan Sandry
Josep Vall
Antonia Luciani
Advisory Scientific Council
Alan Sandry - Political Science adviser. (Advisory Scientific Council member since 2008)
Luc Boeva - Archives and History of Nationalism adviser. (Advisory Scientific Council member since 2008)
Rubén Lois - History and Geography adviser. (Advisory Scientific Council member since 2014)
Carmen Gallego - Anthropology adviser. (Advisory Scientific Council member since 2012)
Josep Huguet - Contemporary history and Public governance adviser. (Advisory Scientific Council member since 2012)
Jaume Garau - Economic development adviser. (Advisory Scientific Council member since 2012)
Daniel Turp - International law and Self-determination adviser(Advisory Scientific Council member since 2013)
Graphics and Layout
Wils&Peeters - Lier
Translation
Dobra Forma
Printing
Drukkerij De Bie - Duffel
© CMC, Centre Maurits Coppieters - asbl, Brussels, April 2014
No items of this publication can in any way be copied or used
without the explicit permission of the author or editor.
34