The Vice-President of the European Commission, Valdis Dombrovskis, and the European Commissioner for the Economy, Paolo Gentiloni, assured on Thursday 28 May that the aid that will be granted to States to modernise their economies under the Recovery and Resilience Facility integrated into the post-Covid-19 European Recovery Plan (see EUROPE 12494/2) will not be subject to binding reform conditions similar to the macroeconomic rescue packages imposed during the sovereign debt crisis.
On a voluntary basis, Member States will submit recovery plans to the Commission detailing the planned expenditure and investments. They will themselves propose milestones to monitor progress in the implementation of the plans and to activate the disbursement of aid tranches. The Commission will examine the consistency of the national plans with the socio-economic policy recommendations per country issued as part of the budgetary procedure for the ‘European Semester’, particularly with the climate and digital agendas. Once an agreement is reached, the plan will be discussed in a specific committee of the EU Council (screening procedure), and Member States will give a binding opinion by qualified majority before the final decision is taken by the Commission.
“This is not a rescue programme by a different name”, but “a voluntary instrument based on priorities established at the national level”, Mr Gentiloni said. For Mr Dombrovskis, the aim was to foster “collective ownership of plans” in the EU Council and “fair treatment”, he said. But Member States will not go in for “micro-management”, i.e., refusing this expenditure or this investment.
“Many people remember the troika. The ‘European Semester’: it’s a bottom up process. That’s why I am convinced the concept can fly”, Budget Commissioner Johannes Hahn told a number of journalists, including EUROPE.
Examination of the legislative proposal shows that the proposal for a regulation establishing the Recovery and Resilience Facility instrument, based on Article 175 of the TFEU, provides for the following envelope. In total, €603 billion in current prices are reportedly available, of which €335 billion (€310 billion in constant prices) is in the form of grants and €268 billion (€250 billion in constant prices) in the form of loans.
Mr Gentiloni indicated that at least “60%” of the sums allocated in the form of grants to a Member State must be committed by the end of 2022, with the remainder to be committed by the end of 2024, when the instrument expires. An application for a loan can be made during the 3 years of the European Recovery Plan.
The annex to the proposal contains a table on the distribution of the amounts by Member State through a key taking into account population, GDP per capita and average unemployment rate over the last 5 years. Italy would be receiving €68.5 billion (20.5% of the total), Spain €65.6 billion (19.9%) and France €34.8 billion (10.4%).
Here is the proposed Regulation (https://bit.ly/2zGti2t ) and its annexes (https://bit.ly/2X90Krg ). (Original version in French by Mathieu Bion)