The overwhelming majority of MEPs on the Committee on Regional Development (REGI) agreed in a debate on Tuesday 12 May that the Just Transition Fund (JTF) should in no way be to the detriment of other structural and investment funds and that its budget therefore needs to be substantially increased.
By way of reminder, the European Commission proposed to endow the Fund with its own budget of 7.5 billion euros, systematically backed by investments from other structural and investment funds. The aim was to achieve, with co-financing, a financial impact ranging from 30 to 50 billion euros (see EUROPE 12403/2). The proposal was deemed unsuited to the scale of the issues at stake by almost all of the MEPs who spoke, starting with rapporteur Manolis Kefaloyiannis (EPP, Greece).
“The additional €7.5 billion is a good first step, but might not be enough to cope with the economic impact of the coronavirus on Europe as well”, he said, emphasising that “any fund used for the JTF should be additional fresh money”.
A specific calculation method
In his report, the Greek MEP proposes to increase the Fund's budget to precisely €17.88 billion (see EUROPE 12478/20). This proposal is based on a calculation carried out internally, as has been explained to us from several sources.
This is 7.5 billion from the fund, multiplied by the average compulsory contribution from the various Structural Funds, ranging from 1.5 to 3 times the amount invested by the JTF, i.e. an average of 2.25. In addition, there is an additional 6% funding under the reward mechanism for Member States with particularly ambitious climate and transition targets, as set out by the rapporteur.
Some MEPs, including shadow rapporteurs from the Greens/EFA group such as Niklas Nienass from Germany, and the GUE/NGL group, Martina Michels from Germany, even wanted to go further and increase the fund's endowment to around €30 billion.
The EPP coordinator, Andrey Novakov from Bulgaria, noted that the question of the size and financing of the fund will be crucial in the negotiations on the future Multiannual Financial Framework (MFF) and he hoped that the European Commission would amend the common provision regulation and the future MFF accordingly, otherwise the European Parliament could block agreement on the EU budget.
Financing of fossil fuel activities
Although MEPs agree on the budgetary issue, they seemed to disagree over the scope of the future fund and the beneficiaries. One of the major points of tension will therefore undoubtedly be the rapporteur's decision to remove the ban introduced by the Commission on supporting investment in fossil fuels. This is a proposal that has provoked an outcry on the left and among the Greens/EFA.
The shadow rapporteur from Renew Europe, Ondřej Knotek (Czech Republic), also insisted that large groups should be able to benefit from the fund on the grounds that they help finance the activity of many SMEs; this proposal was rejected by the Green rapporteur. S&D shadow rapporteur Pedro Marques (Portugal) wanted to strengthen human capital guidelines. Others insisted on the fight against depopulated areas or mountainous regions.
Some MEPs questioned the timing of the fund's implementation, and in particular that of the development of national transitional plans that had become untenable due to the impact of Covid-19. There were also questions about the progressiveness of the transition, with several MEPs (predominantly from the right) favouring a strong gradual approach, while those from the radical left and the Greens/EFA preferred a rapid change.
The deadline for amendments is 20 May. The committee vote is scheduled for July and the plenary vote for September. However, this is a provisional timetable and could therefore change significantly. (Original version in French by Pascal Hansens)