Brussels, 28/01/2009 (Agence Europe) - The European Commission is not sparing any effort to get EU member states to put their hands in their pockets to help the Community budget contribute to the relaunch of the European economy. On Wednesday 28 January, the Commission adopted a communication and three legislative proposals containing the funding modalities for an additional €5bn for essential projects in the energy and broadband infrastructure sectors. At the end of November 2008, the Commission envisaged a total of €14.4bn from the EU budget for the economic rescue plan, €5bn of which was fresh money.
Last December, member states accepted the Commission's proposal on funding modalities for this additional €5bn. The Commission had proposed using margins below the ceiling of heading 2 of the EU budget which contains agricultural spending (€3.5bn in 2008 and €1.5bn in 2009) to transfer these amounts to heading 1 (competitiveness). The source of this additional €5bn does not change for the new proposal: the margins below the heading 2 ceiling. The modifications involve the reduced scale of the transfers from one heading to another and the timetable. The Commission is now proposing that €3.5bn (€1.5bn in 2009 and €2bn in 2010) is transferred from heading 2 to heading 1a for energy sector projects and that €1.5bn (€1bn for high-speed internet in rural areas, as well as €500 million for new challenges in rural areas such as climate change, renewable energies, water management, biodiversity and restructuring the milk sector) remains in the same section but moves from market spending to rural development.
According to José Manuel Barroso, the president of the Commission, the EU recovery plan essentially targets “smart investment” that will give a short term boost while aiming at long term targets. The measures taken by the Commission that day “go in this direction” - namely a list of concrete projects for using the €5bn in unspent funding from the EU budget to build a stronger Europe in the long term. It is also essential to “draw the lessons from the recent gas crisis and massively invest in energy”. The Commission also judges it necessary to “stimulate the European economy” by building information highways in rural communities, explained Mr Barroso.
The package adopted by the Commission contains a communication, “Investing today for tomorrow's Europe”, which provides an outline of the context and objectives for this initiative. In the context of energy sector projects, the Commission ratified a draft regulation focusing on Community support for strategic projects in the energy sector. It has proposed investing a total of €3.5bn in projects such as carbon capture and storage (financial envelope: €1,250 million with €250 million for each country - Germany, the Netherlands, Poland, Spain [with Portugal] and the United Kingdom); offshore wind projects (€500 million, particularly beneficial to projects in the Baltic and North Sea), and gas interconnection projects (€1,025 million, with €250 million going to the NABUCCO project and benefitting Austria, Hungary, Bulgaria, Germany and Romania, and €150 million going to the “Turkey-Greece-Italy” project) and electricity interconnection projects (€750 million for the Baltic, Central and Southern Europe, the Mediterranean and North Sea).
As far as broadband is concerned, the Commission proposes €1bn to extend and upgrade high-speed internet in rural communities. This money will be targeted via the existing EU Rural Development Fund to cover the "white spots" on Europe's broadband map (30% of the population in rural areas who do not have broadband access). To tackle new challenges identified in the "health check" of the common agricultural policy (CAP) the Commission proposes a new sum of €500 million using the existing rural development mechanisms.
The timetable for adopting these proposals is quite long and complicated (agreement at the General Affairs Council on 23 February or 16 March, following examination by energy and finance ministers) but the reaction at Coreper on Wednesday 28 January from member states was mixed. Many delegations provided the following comments: geographical distribution of projects (energy) is unbalanced; there is too much money in the carbon storage domain and not enough for the regions most affected by the gas crisis; there is not enough money for the beginning of the cycle (only €76.2 million in payment commitments for 2009!). Many delegations are also opposing the use of margins from heading 2 to fund these projects. (L.C./transl.rh)