We should worry that local governments are being sidelined in national Social Climate Plans
And make sure that the next EU budget does not make the same mistake – warns the Local Alliance
Local governance
Fossil-free cities
Community energy
Food systems
Fair economiesThe end of June marked the deadline for EU Member States to submit their national Social Climate Plans. These plans are strategic roadmaps that define how countries will use the EU’s new Social Climate Fund to shield vulnerable citizens from the impacts of the decarbonisation of energy and transport sectors.
The Social Climate Fund (SCF) is designed to mitigate the social impacts of the new Emissions Trading System (ETS2), which extends carbon pricing to additional sectors, including emissions from fuel combustion in buildings, road transport, and smaller industries. Social Climate Plans are essential for unlocking each country’s share of the €86 billion available between 2026 and 2032 to address energy and transport poverty while supporting the fossil fuel phase-out of European buildings and roads.
Local voices missing from national Social Climate Plans
To date, only a few of the 27 EU Member States have submitted their plans, raising concerns about both preparedness and inclusiveness for ETS2. One critical gap identified by the Local Alliance – a coalition of Europe’s eight largest networks of local and regional governments – is the lack of meaningful involvement of local authorities in the design of these plans. This is despite clear legal obligations in the SCF Regulation that require public consultation and multilevel governance.
A survey conducted by the Local Alliance, followed by a policy brief published last month, highlights that most national governments have sidelined local governments, undermining the potential effectiveness of Social Climate Plans. Despite being on the frontlines of climate action and social policy, cities and regions are too often excluded from decision-making processes that directly affect their communities.
The risk of sidelining local governments
Without meaningful local input, there is a real danger that Social Climate Plans will be designed as top-down measures that fail to address the real needs of citizens. Energy and transport poverty – two central challenges that the Social Climate Fund aims to tackle – are crucially local issues. Millions of Europeans, particularly those on low incomes, face difficult choices between heating their homes, affording transportation, or meeting other basic needs.
Local authorities are best placed to design and implement targeted, place-based solutions that reflect the specific realities of different communities. Ignoring their voices risks mismanaging the €86 billion allocated under the SCF, missing the opportunity to deliver tangible benefits for those most in need and creating a backlash that will undermine EU objectives and harm the transition.
Lessons for the next EU budget
As the European Commission prepares to announce the next Multi-annual Financial Framework (MFF) on 16 July, the Local Alliance is calling for a fundamental shift towards meaningful multilevel governance in how EU funds are designed, allocated, and implemented.
The Social Climate Fund process must serve as a wake-up call. The exclusion of local and regional authorities has created gaps and missed opportunities that should not be repeated in the broader EU budget. Strategies, priorities, and policies must be co-created between national, regional, and local governments to ensure that funding reaches those who need it most and delivers lasting results.
The Local Alliance advocates for multilevel governance to become a core principle of the next EU budget – not just in theory, but in practice, embedded from the earliest stages of design through to monitoring and evaluation.
Building on lessons from the NECPlatform
The NECPlatform project offers a model for how to make multilevel governance work in reality. The project – that just ended last month – supported six EU Member States in setting up multilevel dialogue platforms to bring local voices into national energy and climate policymaking, particularly during the update of National Energy and Climate Plans (NECPs).
While challenges have emerged – such as inconsistent implementation and limited political will – the NECPlatform has delivered valuable insights into the conditions needed for genuine co-creation. Among its key recommendations is the strengthening of Article 11 of the EU Governance Regulation, which mandates multilevel dialogue in the NECP process.
The recommendations emerging from NECPlatform could serve as inspiration for embedding multilevel governance in the next MFF – connecting EU, national and local policy more seamlessly.
What the Local Alliance is calling for
To avoid repeating past mistakes, the Local Alliance urges the European Commission to mainstream multilevel governance across all aspects of the next EU budget.
Specifically, the Local Alliance recommends:
- Inclusion: Local and regional governments must be a part of the design and decision-making processes of the MFF.
- Empowerment: Local governments should play a central role in the implementation and monitoring of EU-funded programmes.
- Alignment: Multilevel governance structures should be consistent across sectoral legislation and financial instruments, ensuring coherence and efficiency.
- Accessibility: EU funds must be designed and delivered in ways that are accessible to local actors, including smaller municipalities.
A new governance model for a new budget
Europe’s green and social transitions cannot succeed without the full involvement of local and regional governments. The experience of the Social Climate Fund forewarns that sidelining local actors can lead to ineffective policies, wasted resources, and public frustration – risking bringing about a general backlash towards essential EU policies.
As the EU shapes its next budget, it’s time to embrace a new model of shared governance: one that brings all levels of government together to co-create solutions for the challenges ahead.
About the Local Alliance
The Local Alliance is a coalition of Europe’s eight leading city and regional networks, united in advocating for stronger local involvement in EU policy and funding decisions. The members of the Local Alliance are: Association of Cities and Regions for sustainable Resource management (ACR+); The Council of European Municipalities and Regions (CEMR); Climate Alliance; Energy Cities; Eurocities; FEDARENE; ICLEI – Local Governments for Sustainability; POLIS.
