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EASPD Briefing: European Council Conclusions on EU Budget 2021-27 & NextGenEU

Following the onset of the COVID-19 crisis, the European Commission proposed the Recovery Plan for Europe on 26th May, which included both the EU’s “standard” multi-annual financial framework (MFF) and a recovery plan focusing more specifically on the impact of the COVID19 crisis.

Meeting at a special Council Summit in Brussels on 21st July, EU leaders agreed on a 2021-2027 EU budget and a COVID-19 recovery package totalling €1 824.3 billion, which required the approval of the European Parliament.

Following this, the European Parliament adopted a resolution on the Council’s position arguing that it is a “positive step for recovery” but “inadequate in the long term”.
Negotiations are ongoing with the objective of finding a final agreement as soon as possible.  

Following the agreement of the EU leaders EASPD has prepared a briefing outlining how the Council agreement and proposed budget may impact support service providers in Europe.

Next Steps

Overall, the Council Conclusions represent a historical step for the European Union given both the total size of the deal (€1.85 trillion) and the fact that the Recovery Plan includes for the first time the European Union issuing joint debt on the capital markets to help Member States recover from the consequences of the COVID19 crisis. This joint debt will enable countries hit hardest by the crisis (economically and in terms of public health) to respond with “forward-looking” policies, supported by public investment, in order to facilitate their economic and social recovery. The Recovery and Resilience Facility will be a budget totaling €672.5 billion, to support Member States’ Recovery Plans disbursed through grants and loans, in line with the European Commission’s Country Specific Recommendations. This includes – in principle- policy reforms in the field of social service provision (if included in the Member States’ Recovery Plans).  The Council Conclusions also include a significant REACT-EU fund (slightly smaller than the Commission’s proposal) of €47.5 billion to be distributed through ESF and ERDF programmes for immediate projects to help deal with the COVID-19 crisis. In principle, social services could benefit from this fund if included in the Member States’ programmes.
This being said, the Council Conclusions also includes important cuts to the latest 2021-2027 MFF proposal made by the European Commission, notably in the fields of research, education, culture, defence, foreign aid & InvestEU. This should be added to the fact that key programmes such as the European Social Fund had already been cut in the Commission’s 2021-2027 proposal, as compared to the last framework for 2014-2020. It could be argued that the REACT-EU immediate top-up of such funds makes up for the proposed cuts, yet ESF+ includes guaranteed amounts for projects in certain fields (for instance, 25% earmarked for social inclusion measures) whereas REACT-EU – in its current proposal – does not make such guarantees.

To conclude, the Council Conclusions are in many ways a positive step, allowing Member States to take the needed measures for recovery and not be as limited by the financial constraints which could be imposed on them given the impact of COVID19 on economies. This could include providing additional funding for reforms in social service provision (although the guaranteed/earmarked amounts are currently less than in prior programmes). On the other side, much of their position also includes a form of “re-nationalisation” of the EU budget as much of the Recovery Plan is to support national reforms, with a limited role for the European Parliament. In addition, the most significant cuts to the multi-annual financial framework are in programmes with high European added value and directly managed by the European Commission (as well as a limited role for the European Parliament). Other issues such as the re-payment of the EU debt still remain vague, although the ambition is to focus on digital, carbon, financial and other forms of taxes (not income taxes). The vagueness can also mean that the debt would be repaid through cuts to the EU budget in future budgetary frameworks.
 

Next Steps

In the weeks and months to come, the European Council, the European Parliament and the European Commission will negotiate on the overall proposal, as well as on the individual programmes included in both the MFF and the Recovery Plan.

EASPD will engage in the negotiations to ensure that more European Funds are available to tackle the challenges and promote innovation in social service provision, both in response to the COVID19 pandemic and to implement the principles of the UN Convention on the Rights of Persons with Disabilities. EASPD will also support Members to engage with their national authorities on the points mentioned above and to ensure that their sector’s needs are included in Member States’ plans for this EU budget. 

For more information, please contact

Thomas Bignal
EASPD Policy Advisor
T. +32 2 233 27 23
www.easpd.eu