On Wednesday 18 June, the European Parliament endorsed by a comfortable majority (421 votes in favour, 180 against, 55 abstentions) the position of the parliamentary committees on Budgets (BUDG) and Economic and Monetary Affairs (ECON), which are calling for “an 18-month extension of mature projects” under the Recovery and Resilience Facility (RRF), the budgetary instrument of the post-Covid-19 European Recovery Plan (see EUROPE 13644/23).
It will be up to the European Commission to select the most mature projects that can be extended “based on objective, clear and fair benchmarks”, adds Parliament in the report led by the Romanians Siegfried Mureşan (EPP) and Victor Negrescu (S&D).
“If we do not act now, there is a risk that essential investments will remain unfinished after the mechanism ends in August 2026. We need to speed up implementation and cut red tape”, said Mr Negrescu in a press release. Mr Mureşan stressed that the European Parliament was not calling for a new RRF or advocating additional borrowing at EU level. However, “we call for an examination of how unspent funds can support Europe’s new strategic priorities, notably strengthening competitiveness and reinforcing our defence capacities”, he added.
However, an amendment tabled by The Left Group recommending extending the European Recovery Plan by two years, until the end of August 2028, was rejected (76 votes in favour, 488 against, 89 abstentions).
The Commission has repeated several times that an extension of the European Recovery Plan beyond August 2026 is impossible, in particular because the Member States will not be able to amend in time the legislative texts allowing the Commission to borrow on the capital markets to finance the RRF. It has proposed several options for speeding up the implementation of post-Covid-19 national recovery plans and/or transferring European funds to structural funds or European programmes (e.g. InvestEU) to finalise their reforms and projects (see EUROPE 13653/3).
MEPs also welcome “the possibility of establishing a (...) transfer system after the 2026 deadline in order to allow for the finalisation of ongoing projects through other funding schemes, including the European Investment Fund and a possible new European Competitiveness Fund”. The Commission is invited to present “a strategy to address the huge demand for public investment beyond 2026” without compromising budgetary resources in other critical areas.
Furthermore, the European Parliament notes that the total cost of repaying the interest on the capital of the RRF will reach between €25 and €30 billion per year starting in 2028, a sum which represents 15 to 20% of the annual budget for 2025. In this respect, it reminds the Council of the EU and the Commission of their commitment to guarantee a viable path for refinancing the debt contracted under the European Recovery Plan, including by means of new own resources in the EU budget. And to deplore the lack of progress in this area (see EUROPE 13660/17).
Parliament also urges the Commission to draw lessons from the implementation of the RRF, in particular the observations of the European Court of Auditors (see EUROPE 13634/23), so that future performance-based financial instruments are aligned with the objective of financing European public goods.
In the plenary vote, MEPs rejected all the amendments tabled by the far-right group PfE. One of these amendments criticised the Commission’s “political” assessment of the milestones to be met by Member States in exchange for EU financial aid, which was allegedly being used for “political blackmail in certain Member States”. Read: Hungary.
To see the European Parliament report: https://aeur.eu/f/hee (Original version in French by Mathieu Bion)