The Recovery plan for Europe must take local authorities, Regions and Cities on board to be effective in tackling the COVID-19 crisis. A centralised approach, with decisions taken t op-down, risks to create overlaps or even competition among funding tools.
EU Cohesion Policy response to the Coronavirus crisis
The Recovery and Resilience Facility (RRF) is the EUR 672.5 billion instrument. EUR 312.5 billion in grants and EUR 360 billion in loans will support EU countries. Grants and loans will carry out reforms and investing in the EU’s common priorities. The RRF is the biggest financial tool in Next Generation EU. The EUR 750 billion recovery instrument is known also as Recovery plan for Europe. EU leaders agreed EU Recovery Deal, Coronavirus Recovery funds and MFF 2021-2027 budget
Recovery and Resilience Facility (RRF) involves Local Authorities
European regions and cities ask to modify the regulations on the Recovery and Resilience Facility (RRF) and on the European Semester to involve local and regional authorities in the design of recovery plans. CoR proposes to back the partnership between national and local authorities with a Code of conduct. This Code would increase the democratic legitimacy and the effectiveness of the Semester. This will help coordinate the unprecedented set of investment tools that will be available soon, avoiding overlapping and incoherence.
European Committee of the Regions (CoR)
A centralised approach could undermine the impact of the new Recovery and Resilience Facility. Members of the European Committee of the Regions (CoR) shared these concerns in a debate with Paolo Gentiloni. Their views and their improvement proposals will feed into an opinion adopted by the Plenary.
CoR eudebates Resilience and Recovery
“There is no impact without partnership” stressed the President of the CoR, Apostolos Tzitzikostas. During the debate with the EU Commissioner for Economy, Paolo Gentiloni, proposed to jointly promote regions’ and cities involvement and monitor the RRF territorial impact with an annual recovery and resilience regional forum.
The expertise of regions and cities is crucial for EU’s recovery strategy.Paolo Gentiloni, EU Commissioner for Economy
Commissioner Gentiloni, added that: ” Recovery plans can only be a success if national governments work with regional and local authorities. We are ready to cooperate in this direction, including by participating in regional fora as soon as this will be possible again “. As for investment priorities, he stressed that: ” Plans will not be written in Brussels but the Commission will make sure they are coherent with our common framework, making our economies more sustainable and resilient, with a strong contribution to the green and digital transition. I am glad to see that this is fully in line with the CoR demands on the RRF “.
Regional and local leaders’ requests and proposals are included into the opinion entitled European recovery plan. Recovery and Resilience Facility and Technical Support Instrument , adopted by the CoR Plenary.
” We have a clear message for the European Commission and the Member States: the Recovery Plan will not fly without involving cities and regions in both the preparation and the implementation of the national plans. At the same time, the urgently needed recovery measures to resist the economic and social tsunami ahead of us should not go at the expense of longer term sustainable investment. We therefore oppose transferring resources from the structural funds to the Recovery Plan.
The lessons of the COVID-19 have also to be translated into a profound reform of the European economic governance, which must become more democratic, more participative and sustainable “, stated the rapporteur-general Christophe Rouillon (FR/PES), Chair of the CoR Socialist Group and Mayor of Coulaines.
One third of public expenditure belongs to Local authorities, Regions and Cities
Local and regional authorities are responsible for a third of public expenditure (33.6%). Also Regions and Cities control 53% of public investment in the EU ( 2018 figures, OECD ). They have enormous responsibilities and competences in policy fields. They are crucial for the recovery and the Green and digital transitions, from transport or support to businesses, to environment, education or housing.
The pandemic “scissors effect”
Cities and regions’ finances have bad impacts by the COVID-19 pandemic. CoR and OECD published a survey, in the first Annual Regional and Local Barometer. 76% of respondents said the lack of financial resources was very or somewhat challenging in managing the crisis. On the whole, 85% of respondents expected a high or moderate negative impact on their local and regional finances in the medium term (2021-22). The pandemic “scissors effect” – with increased costs for public services and falling revenues from taxes and fees – is a ticking bomb for local finance.
Recovery and Resilience Forum
The CoR and the Commission are discussing the organization a joint EU “Recovery and Resilience Forum” in one year. The RRF aims to impact on the ground to the achievement of the EU Green Deal and Digital transitions and to cohesion. This will also build on the CoR’s work, together with associations of local and regional authorities. RRF will assess the involvement of cities and regions in the preparation of the national recovery and resilience plans.
We are determined to work together to build a more resilient, democratic, sustainable and human Europe!
EU regions and cities to Merkel
German Chancellor Angela Merkel discussed impact of the COVID crisis and future of Europe with EU Committee members. President of the European Committee of the Regions, Apostolos Tzitzikostas, welcomed the Chancellor of the Federal Republic of Germany, Angela Merkel, to the plenary session of the European Committee of the Regions (#CoRplenary) on 13 October. The German Chancellor presented the priorities of the German EU Presidency. She also discussed the role of local and regional authorities in Europe’s recovery. Angela Merkel exchanged views with the Members of the CoR on Europe’s future.
300 regions and 90 000 municipalities are the EU’s democratic foundations and its safety net.Apostolos Tzitzikostas, President of the European Committee of the Regions
Addressing the key expectations of regions and cities to the German presidency, Apostolos Tzitzikostas, said: ” As local and regional leaders, we are on the front line fighting the pandemic. We are working tirelessly to contain the virus, help the most vulnerable, protect our communities and safeguard local economies and jobs. We are considered by our citizens the most trusted and effective level of governance. If Europe wants to better connect with people in the territories and find concrete solutions to their needs, regional and local leaders must be given a greater say in the EU decision-making process”.
Gemeinsam – Together with Local authorities
”The pandemic has shown the limits of the current two-dimensional Europe, based only on Member States and Brussels”, continued President Tzitzikostas. “We need a European House of Democracy with three dimensions where all levels of government – EU, national and regional/local – are working together, for the people and closer to the people. We believe in the German motto Gemeinsam – Together. Together we can build a more resilient, democratic, sustainable and human Europe.”
Local authorities on the front line
Europe’s cities and regions continue to be on the front line in the fight against the COVID-19 pandemic. Local and regional authorities have had to react quickly to provide support to the most vulnerable citizens and to local businesses. The COVID-19 crisis impacts every region, city and local community in Europe. Findings of the Annual Regional and Local Barometer , presented by the CoR earlier this week, show the COVID19 impacts.
Under the motto ” Together for Europe’s recovery “, the German presidency will focus directly on overcoming the COVID-19 pandemic: fighting the spread of the virus, supporting the European economy to recover and reinforcing social cohesion in Europe. Proximity to citizens throughout the crisis has demonstrated the need for LRAs to be a central part of decision-making. LRAs secure a successful and equitable economic recovery.
Coronavirus Response Investment Initiative (CRII) for local authorities
The Coronavirus Response Investment Initiative (CRII) and Coronavirus Response Investment Initiative Plus (CRII+) allow Member States to benefit from a temporary increase of the EU co-financing up to 100%. They can lao use Cohesion policy funding to support the most exposed sectors. For example healthcare needs, SMEs and labour markets.
CRII & CRII+
Commission announced the first provisional results of the implementation of the Coronavirus Response Investment Initiative (CRII) and Coronavirus Response Investment Initiative Plus (CRII+).
EU funds in Cohesion Policy
From the beginning of the crisis the EU mobilised over €13 billion in investments. Thanks to the flexibility introduced in the Cohesion Policy money came through the European Regional Development Fund (ERDF), the European Social Fund (ESF) and the Cohesion Fund (CF). The EU funds helped national, regional and local communities in countering the negative socio-economic impact of the coronavirus pandemic. EU Funds tackle the effects of the coronavirus pandemic
In total, €4.1 billion have been reallocated towards healthcare to purchase vital machinery and personal protective equipment to save lives. €8.4 billion have been mobilised through issuing grants, loans and a series of personalised financial instruments to support the economy and, in particular, Small and Medium enterprises (SMEs) to adapt to the crisis. Finally, around €1.4 billion have been channelled through the ESF to help people and save jobs.
Solidarity and responsibility
The Coronavirus outbreak presents a major challenge to the entire European Union. National, regional and local communities are on the frontline in countering the disease. Solidarity and responsibility across our societies and between Member States are key to overcome this challenge. The benefit of collective and coordinated action as a community outweighs individual and parcelled responses.
EU Solidarity Fund
Thanks to the Coronavirus Response Investment Initiative, Member States can immediately address three key priorities in the fight against the current emergency and its economic consequences.
- Spending on healthcare
- Support to short time work schemes, and
- Support to the SMEs working capital.
The EU Solidarity Fund provided additional assistance of up to €800 million to the worst affected countries. This support came in order to alleviate the financial burden of the immediate response measures.