Opinion of the European Committee of the Regions – Metropolitan regions and functional urban areas as socioeconomic drivers of sustainable investment in the 2021-2027 cohesion policy framework
Date: 2025-05-14
Institutions: Commission for Territorial Cohesion Policy and EU Budget, European Committee of the Regions
Subjects: EU regional policy, investment, metropolis, migration from the countryside to the town, regional development, territorial cohesion, town planning, town-country relationship, urban area








C_202503478EN.000101.fmx.xml












Official Journal of the European Union


EN
C series













C/2025/3478


16.7.2025






Opinion of the European Committee of the Regions – Metropolitan regions and functional urban areas as socioeconomic drivers of sustainable investment in the 2021-2027 cohesion policy framework
(C/2025/3478)














Rapporteur



:


Carmine PACENTE (IT/Renew Europe), Member of Milan Municipal Council









POLICY RECOMMENDATIONS

THE EUROPEAN COMMITTEE OF THE REGIONS (CoR)








1.


stresses that 75 % of the EU population live in urban areas such as cities, towns and suburbs, and this figure is set to grow to 84 % by 2050. Points out that urban areas will inevitably have an increasing impact on the sustainable development of the European Union and on the well-being of Europeans in the future, and that this trend must be properly reflected in post-2027 cohesion and urban policy. This should be without prejudice to the role and competences of regional authorities in the system of governing the cohesion policy. The NUTS2 level is the most appropriate framework for implementing this policy;












2.


notes that urban and metropolitan areas are the main drivers of economic growth and hubs of innovation and economic development, attracting citizens with better opportunities for jobs, education and public services;












3.


notes that urban and metropolitan areas are under increasing pressure, which exacerbates socioeconomic disparities while also creating fiscal and territorial challenges, along with the growing demand for quality public services;












4.


recognises that despite higher GDP, these areas struggle with inadequate public revenues as economic success does not always translate into adequate funding. The GDP per capita does not give the full picture about the level of development or the real needs of territories. Therefore, broader indicators (including a Social Progress Index, SDGs, Human Development Index) should be used in the allocation of resources in order to allocate funds more equitably, ensuring adequate resources for neighbourhoods facing the greatest challenges;












5.


reaffirms the need for strong urban and metropolitan strategies to tackle demographic change, green, digital and industrial transitions, social inequalities, the need for integration, affordable housing shortages, healthcare, mobility, air pollution and climate change;












6.


points out that high population concentrations due to positive migration rates may also lead to deterioration of quality of life, increased poverty risks and social exclusion, requiring adaptable support;












7.


recognises the interconnection between urban and rural areas and cooperation in metropolitan areas as a tool for promoting balanced territorial development and providing specific assistance to small and medium-sized municipalities;












8.


stresses the growing importance of functional urban areas (FUAs) in EU policies, and promotes greater attention to the concept of functional areas in strategic discussions at all levels of governance and within the EU institutions;












9.


highlights the role of metropolitan regions in developing integrated solutions based on mutual synergies and territorial needs that generate higher added value for the area as a whole;












10.


considers that coordination beyond administrative boundaries often presents challenges, in the face of which initiatives, both regulatory and incentive-based (e.g. more funding and higher co-financing rates), should be promoted to encourage collaboration between the various administrations. Such cooperation is necessary in order to overcome persistent urban challenges relating to ecological sustainability, social and territorial inequality, affordable housing and sustainable mobility;












11.


recognises the importance of integrated territorial development tools in supporting sustainable urban development, driving innovation by facilitating cross-sectoral cooperation, leveraging local potential, promoting cohesive growth strategies, and fostering stronger urban-rural linkages, ensuring that metropolitan and functional urban areas contribute to the balanced development of urban areas and surrounding regions;












12.


stresses that cohesion policy funds remain an important source of funding for investments in sustainable urban development and considers it a positive sign that the 2021-2027 period has seen a strengthening of the urban dimension with a package of EUR 24,35 billion from the European Regional Development Fund for investment projects based on territorial strategies;












13.


values cohesion policy support for integrated territorial development under policy objective 5 Europe closer to citizens (PO5), which tackles the economic, environmental, climate, demographic and social challenges of territories, based on territorial or community-led local development strategies, which shall fully integrate the objectives of landscape protection and sustainable management of natural resources, maximising ecosystem services for the benefit of local communities and overall territorial resilience;












14.


points out that the approach of centralised management of funds, including the management of the Recovery and Resilience Facility, could lead national governments to neglect local priorities and that, in order to overcome these limitations, future programming frameworks should systematically integrate the local, regional, national and European levels into policy development, ensuring that urban and metropolitan areas are involved in decision-making processes from the earliest stages;












15.


recognises the importance of shared management programmes in providing regular and constant funding for cities and metropolitan areas, by further promoting the concept of functional areas; calls for common standards for establishing and financing metropolitan and urban functional areas, to be drawn up in partnership with regional authorities responsible for future regional programmes. The aim is to provide a stable basis for them to function;












16.


cautions against further decreases in the EU co-financing, as cities and metropolitan regions already struggle with administrative burdens and restrictive thematic and eligibility conditions associated with EU funding that lower the effective EU co-financing rate. A further decrease would significantly weaken absorption capacity and hinder their full territorial potential; therefore, calls for maintaining and, where necessary, strengthening the EU co-financing rates to ensure that metropolitan regions can continue to play their role as drivers of sustainable investment and socioeconomic growth;












17.


notes, however, that urban and metropolitan areas question the effectiveness of the current instruments for urban transformation, considering them inadequate due to limited budgets and fragmentation of financing instruments;












18.


draws attention to the fact that fragmentation of funds and procedures has negative effects on cities and regions as it increases the administrative burden on urban and regional authorities, and calls for territorial-related initiatives to be streamlined under one set of rules;












19.


notes that a strong, flexible and reformed cohesion and growth policy is needed post-2027, which continues to reduce regional disparities and increase competitiveness in every region of Europe, addressing new challenges, including responding to climate disasters or supporting demographic change;












20.


reiterates its call for a more systematic ex-ante territorial impact assessment of all new EU policies and legislation in the design phase, including impact on regions and metropolitan and urban areas within their boundaries, in order not to exacerbate regional disparities and fuel discontent in the EU;












21.


stresses that cities are instrumental in achieving the Sustainable Developments Goals (SDG) and making human settlements inclusive, safe, resilient and sustainable, but that urban authorities often lack capacity when it comes to making the best use of EU funding incentives and territorial delivery mechanisms (ITI and CLLD);












22.


considers that the capacity-building activities of the European Commission that provide technical assistance under direct and indirect management (such as the European Urban Initiative) have indisputable added value when it comes to the exchange of practice and coordination among practitioners at EU level; points out, however, that these measures should not replace what the EU Member States and managing authorities should do at the appropriate subnational level;












23.


stresses that European Territorial Cooperation (Interreg) programmes increase the administrative capacity of local and urban authorities through a variety of activities that foster collaboration and knowledge sharing; similarly, the URBACT programme helps to strengthen the technical and administrative capacities of cities by providing the necessary know-how for the implementation of sustainable urban development policies, sharing methods and tools;












24.


calls on the EU Member States and managing authorities to increase capacity-building initiatives under shared management programmes by making more prominent use of technical assistance in order to boost capacity, including that of stakeholders implementing territorial delivery mechanisms (ITI and CLLD);












25.


welcomes the European Commission’s intention to issue an ambitious policy agenda for cities that harnesses the potential of cities as drivers of innovation, growth and competitiveness, and emphasises that cities of all sizes matter in achieving the common objective of reducing regional disparities in Europe;












26.


believes that enhancing cities’ strategic and operational capacities and adopting the principles of the New Leipzig Charter contributes to harmonious regional development and leads to more inclusive and participatory governance;












27.


considers that the renewal of the Leipzig Charter in November 2020 constituted an opportunity to strengthen convergence between the urban and territorial agendas, but recognises that there is still a need for more synergy and complementarity between the Urban Agenda for the EU, the Territorial Agenda and cohesion policy in the post-2027 period;












28.


calls on the European Commission to develop the future policy agenda for cities on the basis of the well-established territorial approaches and cooperation mechanisms of cohesion policy, strengthening dialogue with cities, metropolitan areas, functional urban areas and regions;












29.


advocates the continuation of the Territorial Agenda with more strategic focus on cross-sectoral spatial planning that forms a bridge between cohesion policy and other EU policies; calls on the European Commission to embed the territorial dimension and the ‘do no harm to cohesion’ principle across all EU policies and programmes, and to underpin the Territorial Agenda more effectively with the EU’s cohesion and urban policy;












30.


calls for the partnership principle to be respected and for the European Commission’s legislative framework for the post-2027 period to be aligned with the provisions of Commission Delegated Regulation (EU) No 240/2014 of 7 January 2014 on the European code of conduct on partnership in the framework of the European Structural and Investment Funds (1);












31.


believes that the Urban Agenda for the EU needs to be completed and further strengthened. Although it has facilitated strategic partnerships and dialogue between the European Commission, the Member States and local authorities, it has not ensured adequate levels of coordination and integration of urban perspectives into EU legislation and has not received funding;












32.


calls for fresh impetus for the Urban Agenda for the EU that stimulates the European Commission to launch preliminary consultations for new initiatives that have a direct or indirect impact on local and regional authorities;












33.


calls for the involvement of towns, cities and local and regional authorities at all stages of the policy cycle and in shaping the policy agenda for cities so that, building on documents such as the Leipzig Charter, the Pact of Amsterdam, the METREX Manifesto, the 2024 EMA Declaration, the Brussels Mayors’ Declaration and the Eurocities position paper A strong cohesion policy promoting urban transformation, collaboration can be stepped up between urban and metropolitan areas and the European institutions and they can respond jointly and more effectively to the changes that towns and cities are currently undergoing;












34.


calls for the future Commission policy agenda for cities to take a thematically broad and horizontal approach, with a focus on competitiveness, sustainability, digitalisation, social cohesion, housing, mobility and climate resilience, as these are some of the areas of competence where the achievement of EU objectives is at risk; while respecting the subsidiarity principle also advocates encouraging further integrated investments that foster cohesive growth and urban-rural links;












35.


insists that the new Commission policy agenda for cities should include tools for promoting FUAs, which are better able to define and achieve objectives than individual initiatives; these should include mechanisms providing more funding and higher co-financing rates;












36.


strongly opposes any attempt to centralise EU policies currently implemented under shared management and supports the need, in the post-2027 framework, to ensure greater decentralisation through the involvement of local and regional authorities in decision-making processes;












37.


believes that strong governance structure is key to aligning local, regional and national priorities, but notes that many urban and metropolitan areas still lack adequate administrative frameworks;












38.


calls on Member States to test incentive mechanisms whereby unused funds from centralised policies could be redirected, through negotiation and/or competitive procedures, directly to regional integrated programmes and used in particular to the benefit of urban and metropolitan areas, with the aim of achieving predetermined objectives;












39.


would like to see forms of coordination and/or complementarity of instruments identified within the framework of a ‘Common European Urban Framework’ in the future multiannual financial framework. A specific financial mechanism within the framework of integrated regional programming, developed with regions and in cooperation with all urban/metropolitan authorities and their networks, should be introduced in order to help make the initiatives simpler, coherent and unambiguous;












40.


calls for an increase of the 8 % minimum in the ERDF national allocation for urban development, which has already been exceeded in this MFF, alongside stronger integration of urban-focused initiatives in cohesion policy programming, in order to ensure the necessary support also for new European priorities, including affordable housing and security;












41.


calls for expanded access to EU funding under shared management for urban and metropolitan areas within the framework of enhanced integrated regional programming, with a mandatory financial reserve (under regional programmes), to support cross-sectoral regional investments that tackle the urban and regional challenges of today and boost urban-rural links;












42.


calls for the establishment of a minimum 5 % ESF+ reserve for urban territorial strategies to address growing inequalities, poverty, and educational disparities within metropolitan areas, as well as to cope with the pressures of growing demographic challenges and ensure the satisfaction of the growing demand for services;












43.


calls for a new urban agenda that encourages the aggregation of functional and metropolitan areas beyond individual municipalities to better address future challenges; proposes that all cohesion programmes include substantial incentives for projects that cross municipal boundaries, fostering coordinated urban and metropolitan development;












44.


calls for the role of regional authorities to be strengthened, in close collaboration with urban and metropolitan areas, in the strategic planning of territories and investments, moving beyond territorial strategies to establish a programming framework that is responsive to the specific characteristics and needs of each area, while ensuring alignment with EU thematic priorities through flexible mechanisms that reflect local development levels. Furthermore, it is essential that the regions promote and coordinate effective systems for monitoring and evaluating the territorial impacts of funded policies and projects, including through the use of satellite data and other geospatial tools, in order to objectively measure territorial transformations and assess the effectiveness of strategies in achieving sustainable development goals;












45.


calls for the establishment of a direct, structured and binding dialogue between the European Commission, regions and cities, ensuring that urban and regional authorities are directly involved in defining and implementing new EU instruments (e.g., Restore, Affordable Housing Initiative);












46.


proposes a shift towards functional urban areas, recognising the broader spatial and economic dynamics that transcend individual cities and enable coordinated responses to be made to shared challenges and opportunities;












47.


in the framework of the mid-term review, encourages Member States to introduce in national shared management programmes financial reserves for urban and metropolitan areas, aimed at supporting investments, in particular, in sectors involving sensitive issues (i.e. environment, housing and social inclusion) as suggested in the recent Commission proposal aimed at introducing ‘specific measures to address strategic challenges’;












48.


believes that empowering both large ‘magnet cities’ and medium-sized cities as regional and national growth poles can foster a ‘city networks’ model, bridging the gap between policy design and implementation; recommends leveraging the administrative, technical and financial capacities demonstrated by metropolitan urban areas in implementing cohesion policies and the RRF mechanism, recognising their role in achieving EU policy objectives and ensuring the effective execution of performance-based measures; stresses the need to avoid excessive centralisation in planning processes, emphasising the practical ability of urban authorities to implement policies while reinforcing multi-level governance models that combine performance-based approaches with territorial strategic planning.






Brussels, 14 May 2025.


The President


of the European Committee of the Regions

Kata TÜTTŐ
               





(1)  
            OJ L 74, 14.3.2014, p. 1.


ELI: http://data.europa.eu/eli/C/2025/3478/oj
ISSN 1977-091X (electronic edition)