The EU’s Recovery Fund and Long-Term Budget

EU leaders are convening on 17-18 July in Brussels for a special summit that aims to break the deadlock and strike a deal on the €750 billion recovery plan and Multiannual Financial Framework (MFF).

This summit comes at a crucial time when swift action is required to approve the recovery fund and adopt an ambitious, future-proof budget that can foster a fairer, more inclusive and more sustainable EU, as well as counter the immediate effects of the economic slowdown in the EU.

The negotiations between Member States promise to be difficult. It is expected that the inclusion of a rule of law conditionality on the allocation of EU funds will spark strong disagreements and jeopardise the outcome of the Council.

President Charles Michel’s proposal to reduce the spending of the Multiannual Financial Framework (MFF) intends to appease the so-called “frugal” countries, while the European Parliament has reiterated once again last week that it would not approve an agreement failing to provide sufficient funding. Chancellor Angela Merkel of Germany, which holds the rotating Presidency of the EU Council, hopes to reach an agreement on the recovery fund and the MFF by the end of the month and has made clear to Member States that Germany may not support a drastic cut in the size of the economic recovery package.

Input from the European Movement International

In our policy position on “A European Union Response to COVID-19”, we argue that a well-designed EU recovery plan as well as an adjusted MFF offer a solid European response to the coronavirus crisis that will impact our lives for years to come. We call for these tools to embody the principles of cohesion, convergence and solidarity, while protecting citizens’ needs and fostering a more resilient and united European society. As such, the recovery of the EU’s economy needs to support the implementation of the European Green Deal and the digital transformation as the main pillars of Europe’s growth strategy.

Moreover, we believe that a new scheme for own resources can optimise the EU budget, making it more independent from the contributions of Member States. These resources would provide the adequate tools to face future economic shocks and provide solutions to the structural shortcomings in the setup of the current Economic and Monetary Union. Furthermore, we argue that a future-proof budget should prioritise the development of a Social Europe, the full implementation of the Paris Agreements and the Sustainable Development Goals, youth employment and education, an overarching policy towards refugees and migrants, further investment in EU’s security and defence cooperation, and more participatory democracy in Europe.

The EU’s Recovery Fund and Long-Term Budget

Key Texts

Upcoming Dates

Input from the European Movement International