Structural policy for the socio-ecological transformation | Umweltbundesamt

The socio-ecological transformation will change the way we do business and live together in Germany and Europe. Many sectors of the economy are facing major changes. For example, in the future they will no longer be able to emit as large a volume of environmentally harmful greenhouse gases. Many of our economic processes require fossil-based raw materials. We want to replace these with other materials that are renewable or reusable. These necessary changes in the economy will also bring changes to the world of work. In some professions, we will employ fewer people, while other and new occupational sectors will grow and offer employment.

The classic structural policy in Germany is a form of economic policy that is designed to help shape economic change through funding measures. To this end, politicians consider what is important to them in the economy and then usually create financial support options to help with economic challenges or to specifically promote certain things. In most cases, either certain regions or industries are supported, thus overlapping with regional policy or sectoral structural policy.

Both in Germany and in the European Union, structural policy includes funding measures to support economic sectors and regions in remaining attractive. Of course, there are many other policy areas and measures at the European, German, state and sometimes even municipal level that also aim to support the economy and make regions desirable places to live. The funding systems are structured in such a way that there are funding programmes that are for all regions and economic sectors and programmes that are for specific regions and sectors.

At the centre of German structural policy is the German Funding System (GFS) with around twenty funding programmes from different departments. The GFS aims to create equal living conditions between the different regions in Germany. This goal is even enshrined in the Basic Law (Article 72). One of the largest programmes in the GFS is the joint scheme “Improvement of Regional Economic Structures” (GRW), which provides special assistance to regions which are less economically powerful. In the summer of 2024, the Federal Government published the first Equivalence Report. The report uses various topics to present the different realities of life in Germany.

The centrepiece of European structural policy is the cohesion policy. Its aim is to promote social, economic and territorial cohesion in Europe. In the current period (2021-2027), approx. one third (€392 billion) of the budget of the European Union is earmarked for the cohesion policy. Within the cohesion policy, there are different funds to support different topics. The cohesion policy (2021 – 2027) has five priorities (political goals). From an environmental and sustainability perspective, political goals 2 (a green, ⁠CO2⁠-free Europe) and 5 (a citizen-centred Europe) are the most important. In Germany, we primarily receive funding from the European Regional Development Fund (ERDF), the European Social Fund Plus (ESF+) and the Just Transition Fund.

From an environmental and sustainability perspective, it is important that funding enables a sustainable future. Funding in German and European structural policy should address today's economic, infrastructure and social challenges, but at the same time enable and not conflict with a sustainable future. Traditionally, structural policy is motivated by economic inequalities and attempts to balance them out. In recent years, there have been reforms and new developments in both Germany and the European Union that pay more attention to ⁠sustainability⁠ and environmental issues.