The Commission has today proposed modifications to its budget for 2020 to make €11.5 billion for crisis repair and recovery available already in 2020. Once available, the funds will go to help the regions most in need, support businesses and those in need outside EU borders.
Commissioner Johannes Hahn in charge of the budget said: “For our path to recovery it will be crucial that additional funds will be made available and reach businesses and citizens as soon as possible and still in this year”.
The proposal is a technical follow-up of the major recovery plan that the Commission put forward last week, consisting of a new recovery instrument, Next Generation EU, embedded within a powerful, modern and revamped long-term EU budget. As part of the plan, the Commission has proposed to raise €750 billion on the markets and channel them to the EU recovery. To make this possible, the Commission proposed to temporarily lift the Own Resources Ceiling of its long-term budget (the maximum amount of funds that the Union can request from Member States to cover its financial obligations) and the ceiling on the actual spending (MFF payment ceiling). To achieve that, the Commission proposed to amend the Own Resources Decision - the legal text which sets the conditions to fund the EU budget. This requires a unanimous decision of all Member States and approval according to national constitutional requirements.
To bridge the period until ratification of the amended Own Resources Decision, and make much needed funding available to workers, businesses and Member States already in 2020, the Commission proposed last week to adjust the current 2014-2020 long-term budget in order to allow for higher spending still in 2020. Today's proposal comes on top, making sure that the additional 11.5 billion for REACT-EU, the Solvency Support Instrument and European Fund for Sustainable Development (EFSD) will become available as early as possible this year.
On 27 May, the European Commission has put forward its proposal for a major recovery plan. To ensure the recovery is sustainable, even, inclusive and fair for all Member States, the European Commission proposed to create a new recovery instrument, Next Generation EU, embedded within a powerful, modern and revamped long-term EU budget. Next Generation EU of €750 billion as well as targeted reinforcements to the long-term EU budget for 2021-2027 will bring the total financial firepower of the EU budget to €1.85 trillion.
Factsheet 3 Financing the Recovery Plan for Europe