The European Court of Auditors identified on Wednesday 9 December several risks related to the implementation of the Recovery and Resilience Facility, the budgetary instrument at the heart of the European Recovery Plan, in a report taking stock of the measures taken at national and European level in response to the Covid-19 pandemic (see EUROPE 12578/3).
“The effectiveness of the newly proposed recovery facility risks being impaired if: – its financial structure is not adequate; – the [national] recovery plans do not focus on growth-enhancing reforms and investments; – the implementation is not timely; – the level of absorption is low; – the co-ordination of measures at all levels is weak; – planning and monitoring is not based on sound indicators; or – accountability is fragmented”, Ildikó Gáll-Pelcz, the member of the European Court of Auditors responsible for the report, told the press.
Ms Gáll-Pelcz said that the Court’s report described the situation up to the summer of 2020, a situation that continues to evolve due to the persistence of the crisis. She added that the Court does not evaluate the actions taken nor does it provide specific recommendations.
By the end of June 2020, Member States had adopted 1,250 budgetary measures amounting to €3,500 billion to counter the economic and health impact of the pandemic. National state guarantees make up about 60% of these measures, budgetary expenditure 20%, financial instruments 11% and fiscal measures 6%.
These national budgetary measures, which have limited redundancies, will significantly increase public deficits and debt in EU countries, the Court notes. Moreover, the scale and nature of these measures reflect more the relative wealth of Member States than the severity of the crisis that has hit them specifically. Such a situation could accentuate macro-economic divergences and reveal distortions in the conditions of competition.
See the report: https://bit.ly/372jm1o (Original version in French by Mathieu Bion)