The Ambassadors of the Member States to the European Union (Coreper) are in the process of analysing the revised proposal for the 2021-2027 Multiannual Financial Framework (MFF) and the Recovery Plan for Europe, with a view to preparing the first ministerial discussions at the General Affairs Council on Tuesday 16 June and at the level of Heads of State or Government on Friday 19 June (see EUROPE 12494/1).
After a first overview last week (see EUROPE 12498/6), the Croatian Presidency of the Council of the EU has scheduled three thematic meetings of at least 3 hours each this week: financial architecture (Monday 8 June), analysis of needs and criteria for allocating European funding (Wednesday 10 June), the instrument to support corporate solvency and the InvestEU programme (Friday 12 June).
On Monday, discussions confirmed relatively broad support for allowing the European Commission to borrow heavily on the financial markets on behalf of the EU27, increasing the budgetary margin between revenue and expenditure and using Member States’ government guarantees.
The usual positions resurfaced regarding the size of the next MFF, which the Commission suggests increasing to €1,850 billion (€1,100 billion for the core EU budget + €750 billion for the recovery plan). The so-called ‘frugal’ countries – Austria, the Netherlands, Denmark and Sweden – want to reduce the budget by targeting interventions as much as possible on repairing damage or investments related to the pandemic. According to the Netherlands, the investment needs identified by the Commission are too broad, as they include pre-pandemic needs.
On the other hand, Southern European countries, which would be the main beneficiaries of the post-2020 MFF, consider the €1,850-billion envelope to be a minimum. The countries of Central Europe will pay close attention to the amounts allocated to cohesion policy, as the European recovery plan should give priority to the southern countries, which have been most affected by the pandemic.
On the modalities of financial aid, the frugal countries unsurprisingly advocate granting loans to Member States. They are joined in this by Finland and even Malta. Hungary and Estonia are hesitant about the idea of borrowing from the EU budget, but say they are prepared to make an effort.
Germany insists strongly on the need to start repaying the loans made by the Commission before 2028 and over a shorter period of time.
As for the introduction of new own resources to contribute to the EU budget, the idea elicits a positive reaction from many Member States, even though no concrete legislative proposal has been tabled. Sweden, on the other hand, is opposed to any European tax and Austria is not comfortable with the concept of own resources.
Another issue that emerges is the difficulty of the ratification process to make the MFF rapidly operational in early 2020. Belgium, where the regional parliaments will be called upon, is particularly aware of this challenge. Hence the envisaged possibility of amending the 2014-2020 MFF to make some of the stimulus package support available from September 2020. (Original version in French by Mathieu Bion)