Despite the complexity of the process and time constraints, the European Commission has carried out a “overall appropriate” assessment of the national recovery plans presented under the Next Generation EU recovery plan, the European Court of Auditors said in a report published on Thursday 8 September. Nevertheless, it identified some gaps and risks, notably in the monitoring of the milestones set out in the national plans, the achievement of which allows for the phased disbursement of financial assistance.
The Court examined the assessment of the national plans of six countries (Germany, Greece, Spain, France, Croatia and Italy) against the Regulation (241/2021) establishing the Recovery and Resilience Facility, the budgetary instrument at the heart of Next Generation EU, and the guidance provided by the EU institution to these Member States.
According to the auditors, none of the 42 measures from the 6 recovery plans analysed are likely to cause significant harm to the environment (‘do no significant harm’ principle). However, they note that environmental mitigation measures have not been systematically integrated as milestones or targets in the recovery plans.
According to the audit team, the Commission’s evaluation has improved the quality of milestones and targets. But the distinction between milestones and targets is not always clear, and targets and milestones are sometimes insufficiently precise and do not cover all the key stages of a plan. Moreover, due to the lack of a harmonised approach, the number of milestones and targets differs greatly between the different recovery plans (129 for Germany, 527 for Italy).
“The Commission has done a good job”, although “there is a problem of clarity regarding milestones and targets”, according to Ivana Maletić, the member of the Court responsible for the report. She would have liked “more interaction between Member States” to promote the exchange of experiences and the development of cross-border projects.
In addition, the auditors examined whether the Commission had ensured that the national recovery plans took into account a “significant subset” of the country-specific recommendations made in 2019 as part of the ‘European Semester’ budgetary process. As this notion of “significant subset” is not clearly defined, its assessment remains “discretionary, in particular when the Commission has identified shortcomings”, the Court notes.
In addition, some elements of the country-specific recommendations were not implemented. For example, the Spanish and French recovery plans do not include any measures relating to electrical interconnections. The French recovery plan mentions pension reform, but does not include any specific measures associated with a milestone or target, nor does it include any direct support measures to increase renewable energy production. A comprehensive reform of personal income tax is included in the Italian plan, but does not give rise to any specific measures.
Finally, the European auditors note that the Commission’s assessment of the estimated costs suffers from a lack of information. In their view, disbursement profiles are “more the result of a negotiation rather than reflecting underlying costs”.
This report may help the Commission in its assessment of the revision of the national recovery plans, in particular when a country calls on the ‘loan’ component of the European financial assistance.
In September 2020, the European auditors had criticised the distribution of the national envelopes allocated through the European Recovery Plan (see EUROPE 12556/5).
See the Court of Auditors’ report: https://aeur.eu/f/308 (Original version in French by Mathieu Bion with Anne Damiani)