Cohesion policies at the crossroads between centralisation and bottom-up approach

With Sentence No. 175 of 2024, the Constitutional Court decided the Campania Region's appeal on the Development and Cohesion Fund (Fsc), which marked one of the stages in the clash between the Government and the Region on these issues. The Region had challenged some provisions of the so-called 'South Decree' (Decree-Law No. 124 of 2023) complaining of the infringement of regional competences. The Fsc is a national fund financed by ordinary resources that aims to remove economic and social imbalances in Italy. The decree on the South has affected its governance, giving the central power greater powers of direction and control and in fact restricting the regions' margins of action. Hence the regions' grievances and, in particular, Campania's appeal.

The Court upheld one of the Campania Region's requests, declaring unconstitutional one of the contested provisions in the part that does not provide for the involvement of the regional administration, while the other questions were declared manifestly inadmissible and unfounded, thus agreeing with the State. In resolving the doubts raised by the Region, the Court recalls its previous case law on the matter and reiterates that the regulation of cohesion policies and the allocation of the Fsc falls within the exclusive legislative competence of the State (Articles 117 and 119 of the Constitution). For these reasons, 'it is for the State legislature to choose the procedural scheme deemed most appropriate to ensure the optimal achievement of the objectives pursued from time to time in allocating the relevant funds' (Judgment No. 175 of 2024). If the organisational structure of the CSF is a matter of state competence, this implies that the central government may decide to devolve the programming and implementation of the Fund to the regions with a view to so-called place-based or bottom-up policies, but it may also decide to re-centralise, in part or in full, the management of the same with a view to re-centralising public policies for the development of the territories.

The Court's ruling comes at a particular time, when the debate on the re-centralisation of development policies, including European cohesion policy, has become heated, both in Italy and in the European context. Although the CSF does not fall within the structural funds of the cohesion policy, there are many elements that the two instruments have in common: the programming timeframe is the same, i.e. a seven-year programming period; the general objectives are also largely overlapping, being related to the reduction of development gaps between territories and the removal of economic and social imbalances; finally, the CSF also allocates most of its resources to the regions of southern Italy. The current government, and in particular the now former minister in charge of cohesion policies, Raffaele Fitto, who from 1 December will be responsible for European cohesion policy in the new Commission headed by Ursula von der Leyen, has pursued a programme of re-centralisation of many local development and industrial policy instruments, which is articulated in various interventions, including the 2023 Southern Decree, which is the subject of the Constitutional Court ruling. As recalled recently in the Draghi Report, Europe finds itself, for reasons of strategic interest, having to deploy large investments without being able to generate new European debt (as in the case of the Next Generation Eu that financed national recovery and resilience plans). In this context, cohesion policy represents a valuable treasure trove as it has enjoyed a stable allocation in the European budget for decades, although in the next programming period the possibility of major cuts cannot be excluded (see, for example, the debate on military expenditure).

A re-centralisation of this policy in the hands of central governments would allow funds to be redirected, albeit to a certain extent, towards strategic sectors more consistent with national industrial policy strategies. The Constitutional Court's ruling does not change the path mapped out in Italy towards a marked re-centralisation of public development policies. The coming months, and the choices of the new European Commission, will be crucial to understand whether the European cohesion policy will also undergo a process of transformation towards the Pnrr governance model, substantially centralised and managed by central governments, or whether the bottom-up participatory model that has characterised it so far, and which constitutes a pivotal element of European multi-level governance in which regional administrations play a leading role, will endure.

*Cnr-Issirfa