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News > The ViewPoints: The next long term EU Budget

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The ViewPoints

The ViewPoints: The next long term EU Budget

We have been living the unthinkable when it comes to everyday life. An economy hibernating, people confined at home with their children without physical classes and relying on the internet for work, shopping and even “social” contact. This Covid-19 Pandemic has cost by now the lives of many thousands of people in Europe and the rest of the world, causing irreparable damages to the society and economy, thus confining billions of people to their homes.

When it comes to the EU Budget, we have been living the unprecedented. Commission first response to this unforeseeable pandemic has relayed largely on the current EU Budget. In extending flexibilities and entering into the margins, to answer to the unforeseen challenges that affect all Member states symmetrically in asymmetrical ways, since it´s hitting some member states harder than others, at a different step. This response included measures like redirecting €48.5 million from the Horizon 2020 research programme towards the fight against the virus; providing €80 million financial support to scale up development and production of a Coronavirus vaccine; mobilising €140 million of funds and projects that contribute to more efficient clinical management of patients infected with the virus, and to the public health preparedness and response to the outbreak; channelling € 2,7 billion to the Emergency Support Instrument for Health Care Sector and €300 million for medical equipment capacity.

Moreover, unprecedented flexibility was granted in European Structural and Investment Funds. Every available euro of the structural funds can be redirected to the response to COVID-19 by allowing transfers between funds, between categories of regions and between objectives making sure that Member States can put the money where it is really needed.

Besides this, indirectly, State Aid rules changes allowing Member States to temporarily help their economies. Either through direct grants, tax advantages or advance payments for companies; or to accelerate research and productions of coronavirus relevant products, to protect jobs and to further protect the companies, namely by deferral of tax payments and/or suspensions of social security contributions or even in the form of wage subsidies for employees. Temporary measures that should not threaten the good functioning of the internal market.

For the unthinkable crisis, the Commission has come up with unprecedented measures, exploring flexibilities and going to lengths it had never gone before. The European Parliament has been a true supporter of such initiatives and has deployed innovative ways in its working methods for a fast approval of these measures.

What we demand for the next long-term EU Budget is the same: unprecedented capacity enabling the Union to continue to address the current crisis originated in the pandemic, but with a forward-looking perspective. A recovery plan for our economy and citizens which relies in part on the Budget, restoring the full functioning of the internal market and, last but not least, supporting Member States to relaunch their economy, rebalance public accounts and manage public debt in consistent manner with the EU priorities and objectives of the European Green Deal and the Digital agenda.

That necessarily encompasses a revision by the European Commission of its 2018 Multiannual Framework Proposal, addressing supervening events, not only the pandemics crisis and its effects but also the new European Commission compromises and political program.

As a European answer to the crisis, the next MFF must play a central role in the recovery and transformation of the European Economy. Financing directly EU programs, supporting the Recovery Fund, and boosting the lending capacity of the EIB and other financial mechanisms. A powerful EU budget is needed so there can be capacity for massive investment. This new budget will necessarily be different because it must initially answer to the Covid19 crisis recovery, and in a second phase, it must fully address the Union’s political priorities.

Then such revised proposal should deserve the European Council commitment.  Finally, win the consent of the European Parliament, taking fully into account its requests for more ambition, so we can have more Europe, more Union, and more solidarity, but also for new own resources to finance this Union Recovery and the Union Budget, like a plastic or a digital tax.

The solution for our recovery being in the next long term EU Budget also means more transparency, improved accountability and better democracy. Holding institutions democratically elected, accountable for their decisions, turning these more transparent.

Overall, the aftermath of this crisis must be a positive one. The outcome for citizens must be more Europe and not less Europe. Even if it might cost more, it is still a low price.

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