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This paper seeks to explore the synergies between budget and policy through the use of what was called ‘spending conditionality’ in the EU and ‘conditional spending’ in the U.S. It adopts a legal comparative perspective and investigates the EU's very recent practice of conditioning public spending granted to EU Member States against the U.S. long-standing experience on the matter. The paper argues that the analysis of the U.S. experience with conditional spending facilitates a better understanding of the phenomenon in the EU and may usefully enrich the EU policy-thinking on conditionality in future financial frameworks. In particular, the comparative study shows that conditionality may prove an effective governance device to advance important Union-wide policy objectives at the state level. At the same time, the study shows that when used inside established constitutional systems, conditionality is not free from constitutional contestation, and must be tailored in a way that complies with the essential constitutional principles underlying the exercise of power in a federal, multi-level government. Most important, this work shows that the eventual failures of conditionality are very hard to correct through ex-post administrative and judicial control tools. Therefore, a thoughtful ex ante policy planning of conditionality is crucial for its effective operation. The last part of the paper identifies several lessons learned in this respect.

The Rise of Spending Conditionality in the EU: What Can EU Learn from the U.S. Conditional Spending Doctrine and Policies?