First acute aid packages during the Coronavirus crisis

Subject: First acute aid packages during the Coronavirus crisis

This week, Brussels will once again play virtual host to the political debate on the allocation of hundreds of billions of euros in coronavirus support. Prime ministers will meet on Thursday via video call, but there is already plenty of unrest. Many EU countries and their citizens are outraged by the unusual distribution logic that the Commission is using for one of the first acute Coronavirus aid packages. Poland and Hungary (which have 11 437 registered infections combined according to Johns Hopkins University) are to receive much more money than Italy and Spain (379 182 infections combined). In particular, the fact that Hungary will receive EUR 5.6 billion in EU funding while Italy will only receive EUR 2.3 billion is unacceptable. Some critics describe this distribution as an implicit coup.

1. Can the Commission explain its distribution logic?

2. In particular, can it explain why Hungary was awarded EUR 5.6 billion in EU funding while Italy was only awarded 2.3 billion?

Answer given by Ms Ferreira on behalf of the European Commission

(6 October 2020)

As a response to the COVID-19 pandemic, two packages of measures were adopted: the Coronavirus Response Investment Initiative (CRII) and the Coronavirus Response Investment Initiative Plus (CRII+) (1).

These measures mobilise EU funds to respond flexibly to the rapidly emerging needs in the most exposed sectors, such as healthcare, small and medium-sized enterprises (SMEs) and labour markets, and to help the most affected territories in Member States and their citizens.

CRII allows the use of EUR 8 billion of unspent pre-financing amounts, which Member States can use to complement resources from their 2014-2020 national envelopes not yet allocated to operations. The available national allocations depend on the size of the cohesion envelope and on the speed of implementation. This is the reason for the differences among Member States.

CRII and CRII+ focused on immediate mobilisation of available structural funds, to allow for a prompt response to the crisis. However, more was needed. This is why the Commission put forward its proposal for a major recovery plan comprising an emergency recovery instrument ‘Next Generation EU’ and a revamped Multiannual Financial Framework 2021-2027 (MFF) (2).

The aim is to ensure the recovery is sustainable, even, inclusive and fair for all Member States. The bulk of the funding from Next Generation EU will be used to support investment and reforms in the Member States, concentrated where the crisis impact and resilience needs are greatest. On 21 July 2020, the special European Council reached the agreement on the recovery plan and the revamped MFF.

The final programmes, their structure and budgetary envelopes are subject to the outcome of the discussions between the European Parliament and the Council on the elements of the recovery package and MFF, in accordance with the respective adoption procedure (3).

⋅1∙ Regulation (EU) 2020/460 of the European Parliament and of the Council of 30 March 2020 amending Regulations (EU) No 1301/2013, (EU) No 1303/2013 and

(EU) No 508/2014 as regards specific measures to mobilise investments in the healthcare systems of Member States and in other sectors of their economies in response to the COVID-19 outbreak (Coronavirus Response Investment Initiative); Regulation (EU) 2020/558 of the European Parliament and of the Council of 23 April 2020 amending Regulations (EU) No 1301/2013 and (EU) No 1303/2013 as regards specific measures to provide exceptional flexibility for the use of the European Structural and Investments Funds in response to the COVID-19 outbreak. ⋅2∙ https://ec.europa.eu/info/files/eu-budget-powering-recovery-plan-europe_en , ⋅3∙ In particular the Own Resources Decision, the MFF Regulation, the Interinstitutional Agreement, and sectoral legislation.