Representatives of the EU Council, the European Parliament and the European Commission made progress on Friday 18 September in negotiations to finalise the details of the post-Covid-19 Economic Recovery Plan and the 2021-2027 Multiannual Financial Framework (MFF) (see EUROPE 12558/5).
But they were unable to reach a compromise on all the issues. A fifth political meeting is therefore scheduled for 28 September to enable the EU Council and Parliament to reconcile their views on the additional appropriations Parliament has requested for certain programmes (Horizon 2020, Erasmus+, EU4Health, etc.) and on the question of the link between the disbursement of funds and respect for the Rule of law.
“Good progress has been made, and the technical experts will try to build on this over the next few days. We must continue in this positive spirit with a view to reaching an early agreement”, said the German EU Council Presidency.
According to a source close to the dossier, German Ambassador to the EU Michael Clauß warned Parliament that “anyone who tries to delay the MFF is delaying the Recovery Plan”, arguing that “the MFF and the Recovery Fund form an inseparable whole”.
Progress on own resources. According to Parliament negotiators, including José Manuel Fernandes (EPP, Portugal) and Valérie Hayer (Renew Europe, France), “there is still a long way to go before an acceptable agreement can be reached”. They considered that “substantial progress” had been made on the legally binding commitment to introduce new own resources for the EU budget.
According to an EU source, a Parliament/EU Council agreement in principle that includes the issue of new own resources in the (legally binding) Interinstitutional Agreement reportedly exists.
The EU Council and Parliament are reportedly close to agreeing that the basket of new own resources should be sufficient to pay the debt of the Recovery Plan. But only on the condition that the prerogatives of national parliaments and the principle of budget universality are respected.
“This does not preclude the aim of having the amount of new own resources equal the amount of debt to be repaid” under the Recovery Plan, explained one source.
The EU Council and Parliament need to agree on the timetable for the introduction of the new own resources (see EUROPE 12561/14).
Governance. The discussions also reportedly made progress on the involvement of Parliament in the implementation of the Recovery Plan.
Moreover, the EU Council and Parliament reportedly agreed to amend the Financial Regulation to ensure that Parliament can give its opinion on assigned revenue.
EU programmes. But MEPs are not satisfied with the extra funding requested for the EU’s flagship programmes.
The European Commission apparently presented possibilities only in terms of budgetary flexibility. Members are calling for real increases in appropriations.
Rule of law. The EU Council does not yet have a mandate to negotiate with Parliament on the proposal to protect the EU budget in the event of failure to respect the Rule of law.
However, the main political groups in Parliament warned that they would not give their consent to the next MFF without an agreement on an ambitious protection mechanism.
Hungary and Poland are threatening not to adopt the Own Resources Decision if the text on the link between the EU budget and respect for the Rule of law does not suit them.
On Friday, Member States’ ambassadors to the EU discussed the Own Resources Decision. Some delegations indicated that, at this stage, they could not accept this decision before seeing what the text on the link between budget and Rule of law would look like. These delegations consider the MFF, the Recovery Plan, and the link between the budget and the Rule of law as a ‘package’. At this stage, there is therefore no unanimity in the EU Council on the own resources decision.
At the ‘General Affairs’ Council on Tuesday 22 September, the German Presidency will take stock of the state of play in the negotiations with Parliament on the Recovery Plan.
The aim is to conclude an agreement by “the end of September or early October”, said one European official, in order to allow time for ratification by national parliaments of the own resources decision.
The implementation of the Recovery Plan as of 1 January 2021 requires the rapid adoption of this decision (see EUROPE 12562/12). (Original version in French by Lionel Changeur)