The distribution key for allocating funding and the trigger point for the second tranche of funding from the ‘Brexit’ reserve fund continue to be hotly debated in the European Parliament.
At the end of March, the rapporteur for the opinion of the Committee on Budgets, Valérie Hayer (Renew Europe, France), presented a new distribution key for the funds to the other shadow rapporteurs, according to information obtained on Friday 9 April.
Like some of the shadow rapporteurs of the ‘Arimont’ text in the Committee on Regional Development (REGI) (see EUROPE 12679/10) or the Council of the EU (see EUROPE 12688/11), the rapporteur wants to change the distribution key proposed by the European Commission for the first tranche (i.e. pre-financing of 80%, i.e. around 4 billion euros).
The Commission suggests a distribution key based on a ratio of ‘trade with the UK to GDP’. This method of calculation would greatly favour small, open economies.
The rapporteur therefore suggests a distribution key calculated according to a ratio of ‘trade with the UK to trade within the internal market’ at a time when the internal market still comprised 28 Member States. This method would thus better account for the Member States within the EU in the context of the internal market that are most commercially dependent on the United Kingdom.
In addition, Ms Hayer proposes removing the trigger for the second tranche (the remaining 20%, approximately 1 billion euros). As a reminder, this threshold allows the second tranche to be requested only if a Member State has spent the equivalent of 0.06% of national GDP in response to the consequences of ‘Brexit’. An unfair proposal, according to the MEP, which would also benefit certain small Member States, namely Belgium, Denmark, Ireland, Cyprus, Luxembourg, Malta, and the Netherlands.
However, to compensate for the loss that some Member States would suffer with this new proposal compared to the proposal made by the European Commission, the MEP suggests a compensation system based on a pre-allocation mechanism within the second tranche.
Once the pre-allocated sums have been allocated to individual Member States, the remaining financial envelope would be shared according to the ‘trade of a Member State with the UK/trade with the 28 Member States’ distribution key proposed by Ms Hayer. This compromise would not only avoid creating “losers”, but would also ensure that all Member States have access to the second tranche, according to the MEP.
The discussions will be intense. The vote, originally scheduled for Monday 12 April, was postponed to Monday 10 May, at the same time as the vote in the Fisheries Committee (see EUROPE 12693/12). The vote in the REGI Committee, the committee responsible for the matter, is scheduled for 25 May.
On the EU Council side, the Portuguese Presidency of the EU Council is expected to present a new allocation method to national delegations by mid-April in a working group. Its proposal would also aim to rebalance the trigger for the second tranche proposed by the European Commission (see EUROPE 12688/11).
To view the table: https://bit.ly/31ZSfR5 (Original version in French by Pascal Hansens)