EU tens of billions of EU funds will be redirected through drastically changing rules of the EU budget of 2021-2027, from Poland, Hungary and the Czech Republic to countries strongly affected by the crisis in southern Europe – Financial Times acknowledged on May 2 EU budget proposal. According to the article, transformations can be particularly troubling for Poland and Hungary because of the leaked outlook last week, for the first time in the history of the EU, the payment of subsidies is subject to political (statutory) conditions. A regional diplomat also said the paper: the European Commission is managing the scarce resources of our region, which means that we will really lose money from our region.
Some of the key information in the FT article is:
The now redistributive rules of the EUR 350 billion Cohesion Fund have been drastically revised: so far, only the GDP per capita level of development has been determined by the number of EU countries eligible for EU funding. From 2021, on the other hand, on the basis of the old promise, there is a much wider indicator system that takes account of youth unemployment (still heavily affecting the Southern European states), the status of education, the migration environment (presumably the institutional system) frames.
The conditionality of access to EU funds strengthens: on the one hand, the allocation of funds (the existence or absence of the rule of law, such as the independent judicial system) is linked to the fulfillment of the EU principles, and on the other hand, how the money can be distributed (does not elaborate ). It is no coincidence that the forthcoming EU budget will have a chapter on “cohesion and values” and, according to the paper, these developments can clearly raise concerns about the recent Brussels debates in the area of rule of law (Independent Judicial System) in Warsaw and Budapest, which of course the two countries will decide to intervene in their sovereignty.
The rules for the allocation of funds will be changed by the European Commission to ultimately transfer funds from Poland, Hungary, the Czech Republic and the Baltic States to Italy, Greece and certain French regions. This is also a kind of compensation that, following the accession to the EU, the Eastern and Central European region’s convergence objective has greatly reduced the resources available to Southern European countries. Poland can spend EUR 77 billion in EU Cohesion Fund spending in the 2014-2020 EU cycle, Hungary by 22 billion, Slovakia by 14 billion from 350 billion.
All this only amplifies the disputes and tensions that arise from the fact that Brexit is initially throwing a budget hole in the budget, and finding many other new sources. According to the report, the Commissioner for the Budget said that a 5-10% cut in cohesion funding is needed and according to a spokeswoman for cohesion policy, the worst debates of the past 30 years could be around the adoption of the EU budget starting from 2021.
Apart from the shrinking cohesion pot, it is clear that the rules of the allocation of resources are the number of countries in which the refugees have been accommodated. The paper recalls that both French President Emmanuel Macron and German Chancellor Angela Merkel support this type of financial support, with which Germany and Sweden can count on resources.
The Commission will also tighten up which developments will become eligible for EU support, which overall leads to an increase in the amount of budget support to be used by the Member States (the share of EU co-financing decreases, which in Hungary is 85% of the current operational programs %-ancestor).
It is good news, among other things, for the countries of our region that the Commission is planning to reduce the ceiling between the upper and lower limits as to how much money can be lost for the benefit of others in budget bargaining and how much money can be gained from others.
portfolio.hu / Photo: Agriland