The ministers responsible for cohesion policy detailed their requests for a second package of measures under the Coronavirus Response Investment Initiative (CRII) on Friday 27 March at an informal videoconference meeting.
No sooner had the CRII initiative been approved by the European Parliament (see EUROPE 12546/16) than the European Commission was asked by the Member States to present a second package of measures "much more eagerly awaited", it was explained to us. During the discussions on the CRII at the level of the EU Council working group, the national delegations had certainly welcomed the measures presented by the Commission, but had identified certain shortcomings: the lack of flexibility, but also the fact that these measures only partially achieve the initial objective.
Fully backed by the Structural and Investment (ESI) Funds, the CRII initiative will make it possible to disburse €37 billion in public investment. More specifically, the Commission is waiving for 2020 the reimbursement of unspent pre-financing for ESI funds, i.e. €8 billion, a financial engineering that will make it possible to raise an additional €29 billion through European co-financing. So it's not "new money".
This is problematic for regions with little room for manoeuvre as they have already committed most of the funding under the 2014-2020 Multiannual Financial Framework (MFF). Problem: many regions particularly affected by COVID-19 have the highest level of absorption of ESI funds, such as in Italy with the northern regions or in Belgium.
The European Commissioner for Cohesion and Reforms, Elisa Ferreira, had already made a commitment to the Member States to consider further measures (see EUROPE 12449/7). These announcements were welcomed by the Twenty-Seven on Thursday 26 March, who welcomed "the Commission's willingness to further increase flexibility and leverage in the use of EU instruments".
Mrs Ferreira is therefore working on new measures to be presented as soon as possible. For this, she has asked each Member State to send five priorities to the Commission by this Friday at the latest.
Suggestions made by Member States included: - more flexibility on thematic concentrations; - the possibility of budget transfers between categories of regions (the potential reallocation of larger pre-financing amounts from the less developed regions to the more developed urban regions is an explosive point); - an increase in the rate of European co-financing (up to 95%, according to some national delegations).
Some of these measures were inspired by those adopted in the wake of the 2008 financial crisis, we were told.
Transitional measures pending MFF 2021-2027
Some Member States are considering staggering programming over time and, why not, a review of the 'N+3' rule, which sets a maximum period of three years for spending EU funding. Increasing this to 'N+4' would "bridge" the gap between the current budget cycle and the next one.
This proposal recalls the one put forward by the European Parliament. Noting the slow progress in the negotiations on the next Multiannual Financial Framework, it calls for transitional measures, a hypothesis which the Commissioner still disapproved of at the end of February (see EUROPE 12432/10). (Original version in French by Pascal Hansens)