Since 1988, the European Union has invested €480 billion in less developed regions. The Cohesion Policy 2007-2013 amounts to almost 350 billion euros, or 36% of the total EU budget, and is used predominately to carry out objectives of the Lisbon Strategy on growth and employment. About 80% will go towards the convergence of the new member states while 16% of Structural Funds will be used for innovation, sustainability and training projects under Regional Competitiveness and Employment. Just over 2% is allocated for transnational and regional cooperation under European Territorial Cooperation. The investment aims to stimulate growth in the Union's poorer regions and generate 2.5 million new jobs.

The Cohesion Policy 2007-2013 is different from the 2000-2006 Policy in several ways:

• greater emphasis on economic growth and employment and the decentralisation of responsibility
• simplification of objectives and regulations; streamlined eligibility rules; single-funding source and flexible financial management
• EU, national and local level initiatives be driven by a single document called the Community Strategic Guidelines

Before 2004, the main beneficiaries of Cohesion Policy were the western European nations of Greece, Portugal, Ireland, Eastern Germany, Italy and Spain. Following the 2004 accession of ten eastern European countries, however, most funding shifted to the east, as illustrated by the Cohesion Policy 2007-2013: Factsheets.

For the 2007-2013 period, Regional Policy objectives reflect the goals of the Lisbon Strategy. They draw from the current three Structural Funds.

• Convergence (formerly Objective I) – Covers regions with below 75% per-capita EU average GDP. For growth and job-creation initiatives
• Competitiveness (formerly Objective II) for wealthier member states to cope with economic and social change, globalisation and the transition to an information society
• Territorial Cooperation – for stimulating cross-border cooperation to find solutions for problems of urban, coastal and rural development

The Regional and Cohesion policies are implemented through a series of European funds: (1) Structural Funds and Cohesion Funds and (2) Pre-Accession Funds.

The Treaty of the European Union, Articles 158-162, established the precedent of reducing economic disparities between regions. In the 2000-2006 period, there were four funds administered under the Structural Funds. Two of these, the European Agriculture Guidance and Guarantee Fund Guidance Section (EAGGF) and the Financial Instrument of Fishing Guidance (FIFG) are no longer a part of Structural Funds. In July 2006, the Council and the Parliament created a new set of five regulations for application of Structural Funds, including a revision of the two remaining Structural Funds + Cohesion Funds, and two others.

In September 2010, Commissioner Hahn proposed two emergency aid packages -- each worth over €30mn -- to help France and Portugal rebuild after severe storms and flooding.