For the first time, a hard-right conservative has secured a major EU role without being aligned with the political majority. Former ECR leader in the European Parliament and close ally of Italian Prime Minister Giorgia Meloni, Raffaele Fitto will transition from managing Italy’s €194 billion post-pandemic recovery funds to overseeing the EU’s entire Covid recovery initiative, working alongside Valdis Dombrovskis from Latvia. Fitto’s duties will also include directing the cohesion and regional funds, traditionally viewed as a politically neutral yet critical role within the EU.
Cohesion and Reforms, from 2019 to 2024
The 2019-2024 period has been interesting for the EU’s Cohesion and Reforms policies, which are designed to reduce regional disparities and promote balanced development among Member States, such as job creation, business competitiveness, economic growth, sustainable development and improvements to citizens’ quality of life. The overall budget for cohesion policy is €392 billion for the 2021-2027 period, accounting for approximately one-third of the total EU budget. This substantial budget includes three major funding instruments:
- European Regional Development Fund: This fund focuses on economic development and investment in infrastructure and innovation, targeting areas that need support for growth.
- Cohesion Fund: Aimed at helping Member States whose Gross National Income per capita is below 90% of the EU average, this fund finances projects that enhance economic development in less wealthy regions.
- European Social Fund Plus: This fund is designed to improve employment opportunities and promote social inclusion across the EU.
Additionally, the NextGenerationEU recovery package, valued at €750 billion, is a financial commitment intended to aid recovery from the COVID-19 pandemic. A notable portion of this package is allocated for cohesion and reform initiatives, supporting long-term resilience in Member States. Finally, during this period, the Just Transition Fund was introduced, which has €19.32 billion earmarked to assist regions that are heavily dependent on fossil fuels, such as Poland and Slovakia. This fund is essential for helping these regions transition to greener economies by reducing reliance on coal and other high-emission energy sources. In total, approximately 30% of the EU budget is spent to support climate-related initiatives.
As the EU considers reforming cohesion policy for the 2028-2034 budget, the issue of conditionality has gained attention, especially following findings from the European Court of Auditors. The Court identified roughly €15 billion in misused cohesion funds from 2014 to 2020, often due to limited administrative capacity in certain regions. This raised the debate over conditionality, linking funds to specific reforms. Supporters believe that conditionality could improve efficiency by encouraging regions to enhance transparency and accountability. However, critics argue that it could marginalize weaker regions by setting conditions they struggle to meet, thus deepening inequalities. Raffaele Fitto, Commissioner selected for Cohesion and Reforms, is thought to favor stricter fund management and is open to conditionality. He advocates for centralized control over cohesion funds, arguing this could streamline oversight and ensure that funds align with broader EU objectives. But local authorities fear this would limit regional influence, clashing with the EU’s emphasis on partnership and subsidiarity, which aim to keep regions closely involved in decision-making.
From Elisa Ferreira to Raffaele Fitto; from left to far-right
Raffaele Fitto, a member of the far-right Fratelli di Italia party, will now head the Cohesion and Reforms portfolio. His political background includes co-chairing the European Conservatives and Reformists group in the European Parliament from 2014 to 2022, where he advocated for conservative positions and often challenged EU integration policies. As Minister for European Affairs and Cohesion in the Meloni government, Fitto has pushed for a more centralized management approach for cohesion funds, raising concerns among local authorities about reduced access to funding and diminished regional governance.
Fitto’s appointment is strategically significant for Italy. He oversees substantial financial resources, including funds from the NextGenerationEU recovery package, which is critical for supporting Italy’s recovery efforts. The importance of his portfolio, which involves substantial financial decision-making, positions him to influence fund allocations significantly, potentially strengthening Italy’s standing in European economic discussions. Then, under an ECR-led administration, the Italian government aims to solidify its role within the EU.
Challenges for DG REGIO
As Executive Vice-President for Cohesion and Reforms, his mission letter outlines responsibilities that include managing cohesion policy, promoting regional development, supporting urban planning, and contributing to the EU’s Climate Adaptation Plan. A major challenge lies in effectively managing cohesion funds while meeting increasing demands for transparency and accountability in the context of bad allocation. Given the EU’s budgetary constraints, Fitto must demonstrate that funds are managed efficiently to maximize their impact. Fitto’s stance on conditionality, linking access to funds to structural reforms, has sparked significant debate. While supporters argue that conditionality could improve fund utilization by prompting necessary reforms, critics contend it might worsen inequalities, particularly for regions like Calabria, which may struggle to meet stringent requirements. Fitto’s portfolio also includes overseeing the €750 billion Recovery and Resilience Facility, designed to facilitate structural reforms and enhance resilience across the EU. Given the scale of these funds, he must ensure they effectively contribute to the EU’s long-term sustainability goals, particularly by supporting green projects and fostering digital innovation.
The political environment surrounding Fitto’s role is further complicated by his association with the far-right Meloni government. Critics express concern that his centralized approach could conflict with the EU’s principles of subsidiarity and regional partnership, which are vital for maintaining cohesion policy’s collaborative spirit. Many members of the European Parliament question Fitto’s commitment to upholding the core values of solidarity and equity inherent in cohesion policy, especially given his party’s nationalistic stance. Critics of Raffaele Fitto’s appointment, such as Cristina Guarda, Mimmo Lucano, and other leftist figures, have expressed serious concerns about the implications of placing individuals from sovereignist governments in this kind of significant role within the EU. They argue that these appointments threaten to undermine the EU’s foundational principles of integration and solidarity, which are crucial for supporting vulnerable populations across Member States. Finally, the next long-term EU budget will likely be influenced by evolving geopolitical dynamics, which could lead to significant changes in how cohesion funds are distributed. As various Member States adjust their priorities in response to global challenges – such as climate change, economic instability, and rising populism – there is a fear that funds may be redirected away from those regions that need them most.