A report by Labour MEP Arlene McCarthy, endorsed with a large majority by the Strasbourg-based assembly last week, reviews the£6 billion of regional and social funds earmarked for the UK between 1994 and 1999 and concludes that councils, rather than quangos, need a greater say in how the money is spent.
In one of 29 resolutions forwarded to the European Commission and the UK government, the parliament says it 'recognises the important role played by local authorities in partnerships and regrets the decline in representation of local authorities in favour of non-accountable bodies (quangos) and calls on the UK government to strengthen the role of local authorities and to allow elected members to sit on monitoring committees, in order to enhance the democratic accountability of the funds'.
Ken Bodfish, chair of the Local Government Association's European and International Panel, said: 'I welcome the recognition of the partnership role of local government with Europe and national government. For years we've been complaining about the exclusion of local representatives.'
'The government offices have resisted representation by members. It's been a purely dogmatic objection,' Mr Bodfish said.
According to the European Commission, structural funding helped create or maintain 240,000 jobs in the UK between 1989 and 1993. But the report notes that 'EU support to UK regions has increased over the 1989-1999 period while central government support has fallen dramatically, creating a matching funding crisis in some regions'.
The parliament suggests greater use of the private sector in the future could be a solution to match funding problems.
MEPs are also pressing Whitehall to consider setting up regional development agencies to introduce more effective planning. The parliament also insists that environmental impact assessment studies should be made compulsory before projects are approved for funding.
Ms McCarthy's report acknowledges that EU structural funding has helped the UK regenerate less prosperous regions. But it criticises the funding process for being too complex, and calls for a clearer application system and a more transparent assessment process.