Empowering future-wise small urban areas

April 2022

Small urban areas are often overlooked in policy making and public debates. Still, a substantial share of the people lives in small urban areas, more precisely about between 25% and 43%, depending on the definition. This makes small urban areas an important part of Europe’s territorial, social and economic fabric, as e.g. outlined in the Territorial Agenda 2030. They are centres for the provision of services of general interest and places with a good quality of life. However, their attractiveness is increasingly under threat due to demographic change and grand societal transitions in Europe.

That small urban areas are often overlooked is also due to the fact, that they are very diverse and there is no generally accepted definition. In general terms, urban areas with 5,000 to 50,000 inhabitants can be understood as small urban areas. About 43% of the EU population lives in such municipalities. Excluding areas with a population density below 300 inhabitants per km2, small urban areas are still home to about 25% of the population.

A recent study to the European Committee of the Regions shows that in many cases small urban areas do not have sufficient capacity to tackle the transitions challenges ahead. In general, there is little knowledge about how to address the transitions in small urban areas. This is particularly challenging given the high diversity of small urban areas, their demographic and economic profiles as well as their territorial context and role therein.

To address local development challenges and proactively approach the green and digital transitions as well as demographic change, requires the capacity to act. This means the capacity to mobilise people and resources to develop and implement strategies and ideas. In times of crises, transitions or abrupt changes, it also requires the capacity to navigate under uncertainty. In particular for smaller places this usually also means the capacity to ‘punch above their weight’ to make things happen rather than following a ‘laissez-faire-approach’.

In more practical terms, these capacities can be broken down into a number of formal and informal capacities (see figure):

  • Leadership and adaptation capacities: Transition and recovery processes often imply the need for small urban areas to punch above their weight and to navigate under uncertainties. This boils down to leadership and adaptation capacities of various sorts. In most cases this requires a dynamic and well-connected player in the area, agile local administration and knowledge. It also concerns the willingness to change.
  • Financial capacities: An urban areas’ financial capacities are decisive for its capacity to act. This concerns own financial resources as well as access to external resources, incl. transfer payments. Both are largely framed by two factors, the national system for local financing and size of the urban area. Fiscal autonomy and financial leeway raise the possibility for urban areas to steer their development.
  • Formal competences: Closely linked to financial capacity are the institutional capacity and formal competences of small urban areas, defined by the national governance systems. In many EU member states the provision of services of general interest is mainly organised locally in a decentralised manner. Active small urban areas have a broad multifunctional portfolio of tasks they perform. Still, the autonomy, roles and competences of local governments vary widely between EU member states and also change over time.
  • Collaboration competences: Collaboration capacity is important as most transitions and strategic decisions cannot be handled by a single entity but require the collaboration of a broad set of players. Collaboration is a key ingredient of the capacity to mobilise additional people and resources. For small urban areas, collaboration capacities concern collaboration with various players in the urban areas, or within a wider functional areas as well as liaison with other small urban areas to push an agenda.

The study concludes that small urban areas need to boost their administrative capacity to shape their transitions and develop long-term perspectives. This requires addressing the pathways to handle demographic change. It requires strengthening thinking and decision making in terms of functional areas and intermunicipal cooperation. We also need more knowledge on development and transition specificities of small urban areas, in terms of comparable European wide insights, as well as bottom-up citizen-science based insights. Most of all, administrative and political capacity building in small urban areas needs to be strengthened. Small urban areas need more empowerment concerning their capacity to mobilise people and resources, collaborate, navigate under uncertainty and to punch above their weight.

Depending on the national governance system different capacities need to be supported in different formats. In addition, funding opportunities for small urban areas are needed, considering their needs and allowing for simplified procedures acknowledging their administrative constraints.

Supporting small urban areas to boost their capacities will help that more of them remain being attractive places which play a role in Europe’s settlement pattern. With enough capacity they can manage the transitions ahead and continue to be essential building blocks for cohesion in Europe.

The full report is available here.

by Kai Böhme


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