C HAPTER 3 Management of the European Structural Funds in Bulgaria 53 3 Management of the European Structural Funds in Bulgaria Assoc. Prof. Margarita Shivergeva 3.1. State of Affairs 3.1.1. Nature of the Structural Funds Management Process Structural Funds are‘public money for development’. Together with the Cohesion Fund, these are the main financial instruments of the economic and social cohesion policy of the European Union(EU). The cohesion policy—which operates with about one-third of the EU budget—is one of the most vivid, tangible manifesta­tions of solidary among EU Member States. It is also a political response to the economic and social divide and, in particular, to the disproportions in the develop­ment of the Member States and their regions. The gist of the cohesion policy boils down to a transfer of resources among Member States through the EU budget in order to support economic growth and sustainable development by way of investing(in human and physical capital) with­in those regions(and countries) which are unable to compete—so that they can grow stronger and catch up with richer and more developed countries. The cohe­sion policy does not redistribute wealth but boosts competitiveness in order for countries to cope on their own. It focuses on key factors of competitiveness and, through its instruments, finances actions only in areas covered by national public expenditure, without substituting the national element but only supplementing it. In this light, the cohesion policy often becomes the engine of national policies in the areas chosen for financing. The practices implemented, so far, show that the cohesion policy does have an impact on development, thereby improving physical, financial, human, social, and environmental capital of the supported countries and regions. The cohesion policy