Cohesion policy: from redistribution to Europe’s territorial operating system

February 2026

The year 2025 was not a quiet one for cohesion policy. Rather, it was a year in which familiar debates about 'how much funding' and 'who gets what' were overtaken by a deeper, more consequential question:

What is cohesion policy actually for in an age of polycrisis, mission politics and geopolitical stress?

The following is a summary of some of the main features and turning points of cohesion policy that have been discussed in our blog posts over the last 12 months (Opens in a new window). Throughout the 18 cohesion policy blog posts in 2025, one message emerged repeatedly: cohesion policy can no longer be understood solely as a redistributive mechanism. Rather, it is increasingly Europe’s territorial operating system; a governance infrastructure that can hold together a diverse continent while navigating shocks, transitions and mounting political fragmentation.

Viewing cohesion policy as a territorial operating system has profound implications for how the EU’s next long-term budget and the future of territorial governance are viewed.

The MFF proposal: an architectural gamble

Much of the year’s discussion was based on the European Commission’s July 2025 proposal for the next Multiannual Financial Framework (MFF 2028–2034). The proposal promised simplicity, integration, and strategic direction. However, it also triggered immediate alarm.

At the heart of the reform is the concept of National and Regional Partnership (NRP) Plans, which would replace hundreds of programmes with 27 national plans and one Interreg plan. In principle, this could help to overcome the fragmented silos that have long weakened EU spending. It could enable cross-sectoral missions, link reforms and investments, and strengthen outcome orientation.

However, the same architecture also carries an obvious risk: recentralisation by design.

When a single plan per member state becomes the main gateway to EU funds, the national level becomes the key interlocutor. This means that territorial voices may depend on national goodwill rather than entitlements. While the partnership principle may survive on paper, it could be hollowed out in practice. At worst, cohesion policy becomes less place-based and more capital-centred, shifting resources and influence towards powerful actors and growth poles.

This is why, throughout the year, we approached the NRP debate as a significant governance decision rather than a technical reform: integration versus centralisation; learning versus ticking boxes; territorial intelligence versus national bargaining.

Cohesion versus competitiveness is a false dichotomy

Another recurring theme in 2025 was the framing of cohesion and competitiveness as opposing objectives. The MFF proposal reinforced this tension by placing them in separate headings, implicitly inviting a trade-off: should we invest in innovation and global positioning or balanced development?

We argued that this is the wrong question.

Europe’s competitiveness cannot be politically, socially or economically sustained if it produces a map of winners and losers. Territorial polarisation is not an unintended consequence; it is a strategic vulnerability. The 'geography of discontent' – already evident in electoral outcomes, declining trust and democratic backsliding – is not merely a cohesion issue. It is a competitiveness problem.

Therefore, the challenge for the next EU budget is not to choose between cohesion and competitiveness, but to align them territorially, enabling more regions to participate in transformation rather than compensating for exclusion afterwards.

Missions, scale and the politics of impact

Several of our posts from 2025 explored possible scenarios for a more mission-oriented and impact-driven EU budget. A consistent critique was that Europe’s policy machinery remains too fragmented, with too many instruments and parallel calls and too little integration across domains.

The proposed solution was bold: fewer, larger funding envelopes organised around missions, with the EU shifting its focus from 'how many projects can we fund?' to 'how much change can we trigger?'.

This is an appealing idea, particularly in a world where the United States and China are investing on a large scale. However, scale does not automatically equate to impact. 'Big bets' can just as easily become big bureaucracies, big rent-seeking arenas or big centralisation machines.

The territorial risk is clear: large strategic funds often favour those with the strongest ecosystems, the best administrative capacity and the most advanced innovation infrastructure. Without place-sensitive design, mission funding can exacerbate spatial inequality.

Therefore, the 2025 debate converged on a core principle: missions must be territorially anchored and co-governed. They cannot be imposed from Brussels, nor delivered through national capitals alone. They must be developed through territorial pipelines that connect European ambition to regional realities.

From spending to learning: impact mechanisms with a warning label

One of the most important shifts discussed in 2025 was the move from a spending logic to a learning logic. In a fiscally constrained Europe, legitimacy increasingly depends not on the size of the budget, but on its demonstrable outcomes.

This opens the door to impact mechanisms, such as result-based funding, stronger monitoring frameworks, comparative evaluation methodologies and transparent systems that allow benchmarking and peer learning.

However, our posts also adopted a sceptical stance. Impact governance can fail in at least two ways.

Firstly, it can become a technocratic trap involving metric myopia, misaligned incentives and short-term measurable wins replacing structural change. Secondly, it can lead to territorial injustice, with regions that have weaker data ecosystems and evaluation capacity being excluded from the 'learning economy' and result-based funding becoming a new form of inequality.

The lesson is not to abandon impact orientation, but to treat it as a governance culture rather than a spreadsheet exercise. Learning must remain contextual, place-sensitive and inclusive.

Foresight as core governance capability

Another theme running through the blog collection is the growing importance of foresight. Climate risk, demographic ageing, geopolitical fragmentation and technological transformation are not temporary shocks. They are systemic pressures.

Cohesion policy can no longer operate solely on backward-looking indicators. Territorial foresight, stress-testing of regional systems and anticipatory governance are increasingly seen as essential components of programming.

Foresight is thus moving from the margins of strategic debate into the core of policy design. Preparing for uncertain futures is becoming a structural requirement rather than an optional exercise.

Territorial Impact Assessment is no longer optional

If one tool was repeatedly highlighted in 2025, it was the Territorial Impact Assessment (TIA). The post-2027 budget proposal is not a marginal adjustment. It is a fundamental redesign of how EU policies interact across space.

This makes ex-ante territorial impact assessments urgent. These should not be seen as mere box-ticking exercises, but rather as a means of providing decision support, enabling us to anticipate winners and losers, stress-test governance scenarios and expose trade-offs before they escalate into political conflict.

A proper TIA for the next MFF should not aim for false precision. Rather, it should provide actionable intelligence by modelling how policy content and governance models shape territorial outcomes.

Small projects, big choices: cohesion as democratic infrastructure

Finally, 2025 reminded us that cohesion policy is not just about missions, funds and frameworks. It is also about trust.

In our Interreg post on small-scale projects, we argued that micro-cooperation tools are not just decorative. They provide entry points for schools, associations, youth groups and small municipalities that would never access large programmes.

However, inclusion comes at a cost. If the EU wants proximity and participation, it must pay the real cost by properly funding intermediaries, simplifying tools for their intended purpose, and measuring what matters: trust, engagement, and long-term cooperation capacity.

The bottom line: cohesion policy is Europe's territorial operating system

Taken together, the cohesion policy posts of 2025 point towards a single conclusion: Europe needs more than just new instruments. It needs crisis-ready territorial systems.

This involves strengthening local and regional capacity, establishing anticipatory governance, incorporating foresight, intelligently streamlining processes (rather than centralising them) and ensuring that long-term development goals are not compromised in the pursuit of short-term urgency.

In an era of polycrisis, cohesion policy can become Europe’s resilience backbone, but only if it remains genuinely place-based, territorially intelligent and democratically anchored.

As we engage in more intensive debates about EU policies post-2027, it is important to remember that diversity is not a constraint to be managed, but rather a foundation for positive change. By aligning our funding with long-term strategic visions and local realities, Europe can transform its budget into a true investment engine for the future, rather than merely a redistributive mechanism.

by Kai Böhme

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