The four main pro-European political forces in the European Parliament – the EPP, S&D, Renew Europe and Greens/EFA groups – have cobbled together a compromise on the Recovery and Resilience Facility proposal, ahead of the vote in the Committees on Budgets and Economic and Monetary Affairs scheduled for Monday 9 November (see EUROPE 12551/11).
“I foresee absolutely no surprises”, Siegfried Mureșan (EPP, Romania), one of the three co-rapporteurs in Parliament, told EUROPE on Thursday 5 November. He stressed Parliament’s willingness, as a co-legislating European institution, to move swiftly in the forthcoming negotiations with the German EU Council Presidency to ensure that European financial aid supports economic recovery as soon as possible in 2021.
Thus, in order not to make future interinstitutional discussions more complex, MEPs do not propose to change the Facility’s budget envelope (€672.5 billion, comprising €312.5 billion in grants and €360 billion in loans) or its distribution among Member States (see EUROPE 12562/12). However, they want to have a say in the implementation and governance of the Facility, the budgetary instrument at the heart of the Next Generation EU Recovery Plan.
We are restoring the life of the Facility to “4 years”, because the epidemiological situation has worsened since July, Mr Mureșan said, who does not rule out several subsequent waves of the Covid-19 pandemic. Member States have reduced the duration of the Facility to 3 years (see EUROPE 12578/3 and 12575/1).
MEPs identify six areas for action: – the green and just transition; – the digital transition; – economic cohesion and competitiveness; – social and territorial cohesion; – the capacity of public institutions to prepare for and respond to crises; – youth policies. Each area should be allocated at least 7% of the total budget allocated to each country.
“We decided not to reinvent the wheel, but to channel EU recovery money towards existing EU strategies. [...] We also want the RRF to help the next generation avoid being the ‘lockdown generation’ – a minimum of 7% of the [Facility]is earmarked for youth, long-life learning and skills”, said Dragoș Pîslaru (Renew Europe, Romania), writing to EUROPE.
Increased focus on climate policy
“The European Parliament wants the Facility to be greener”, Mr Mureșan stressed.
In line with the EU’s objective of climate neutrality by 2050, a majority of the two committees are expected to recommend that “at least 40%” of the allocations in national recovery plans should be devoted to climate and biodiversity policies, with Member States having set a threshold of 37%. “At least 20%” of national envelopes should also be devoted to the digital transition, according to MEPs.
On the other hand, MEPs are not expected to exclude investment in fossil fuels, as Greenpeace is calling for. “Nothing is forbidden”, Mr Mureșan said, adding that Member States will not be allowed to launch investments that would be detrimental to the EU’s strategic priorities (the ‘do no significant harm principle’).
On the governance of the Facility, Parliament will likely align itself with the EU Council’s position by asking the Commission to take a decision within 2 months of the submission of the national recovery plans. However, according to it, the adoption of these plans at European level should take place through delegated acts, whereby Parliament and the Council of the EU are on an equal footing, whereas the Council of the EU requires implementing acts.
According to Mr Pîslaru, this formula “will confirm the parliamentary legitimacy that has been lacking for too long in the European framework for economic governance”. We believe that this step can be completed in a few “weeks, not months”, and “ will not exceedingly delay the arrival of the money”, he added.
Another disputed element concerns the respect, in the implementation of the Facility, of the macroeconomic framework. Mr Mureșan made no secret of the fact that, on this point, some Members wanted a link to be included and others none. According to the compromise reached, the European Commission will be invited to propose, by means of a delegated act, a link between the Facility and sound macroeconomic governance within 3 months of the end of the freezing of the Stability and Growth Pact.
MEPs call for strict control and real transparency of financial aid, including the identity of the final beneficiaries, in order to protect the EU’s financial interests.
Finally, provision is made for pre-financing of 20% of the Facility’s budget, instead of 10%.
See Parliament compromise amendments: https://bit.ly/2I6JZZe (Original version in French by Mathieu Bion)