Final approval of the EU budget: Renew Europe shapes Europe’s recovery and protects our values

After long inter - institutional negotiations, held in the context of the Covid crisis and marked by strong political tensions over our common European values, Renew Europe welcomes the final agreement finally concluded between the European Parliament and the European Council on the European recovery package, including the 2021-2027 Multiannual Financial Framework, the interinstitutional agreement on budgetary matters and the rule of law conditionality mechanism.

Several major aspects bear Renew Europe’s stamp:

- The additional 16 billion of euros obtained by EP  negotiators will notably be allocated to the following key programmes: health (+ 3.4 billion - which corresponds to a tripling of that budget!), research and innovation (+ 4 billion), youth mobility (+ 2.2 billion), borders management (+ 1.5 billion) and protection of our democratic values (+ 0.8 billion) ;

- The interinstitutional agreement sets up a legally binding calendar for the introduction of new own resources in the course of the next long-term budget, which revenues should be sufficient to at least cover the repayment of the recovery plan’s debt;

- A climate spending target raised at 30% (compared to 20% today) and, for the first time ever, a new biodiversity spending target of 10% as of 2026 ;

- And a robust and applicable rule of law conditionality mechanism that could be triggered in case any public authorities’ breach of the rule of law poses a risk to EU budget spending

Renew Europe's economic priorities in favour of SMEs, innovation and digital technology, and youth are fully taken into account, as are its political priorities for strengthening the role of Parliament in the management of the recovery plan and own resources, as well as to include the gender dimension in EU public expenditure.

The resolution supported by the pro-European political groups welcomes this historical achievement, but also recall Parliament’s prerogatives to make sure that law is respected, also by EU institutions. Renew Europe therefore recalls that the European Council conclusions on the rule of law conditionality mechanism are superfluous. It recalls that only the regulation prevails over any declaration, and the Commission shall ensure the application of the Treaties and of measures adopted by the co-legislators.

Dacian CIOLOŞ, President of the Renew Europe Group in the European Parliament, said:

“2020 put everything to the test - our  health, social, political and economic systems.   At the beginning of the year, the crisis exposed the weaknesses of the European project, particularly in terms of  EU wide coordination.  But Europe has shown its capacity to rebound and has given us the clear prospect of the deepening our European project. The recovery plan which boosts the multiannual budget is an historic step forward.  We are not just taking steps to rebuild our economies but also taking structural decision to transform our Union - I am speaking in particular of the new own resources and conditionality to the rule of law.”

Next steps

The whole package will enter into force as of 1 January 2021. The negotiations on the regulation setting up the rules for the national recovery plans financed by the EU (Recovery and Resilience Facility) are still ongoing and should come to an end in the coming weeks to allow a swift implementation of the funds.

National parliaments must now ratify the Own Resources Decision giving authorisation to the Commission to borrow money on financial markets.

As far as the rule of law conditionality mechanism is concerned, the only binding text is the regulation itself. It therefore prevails over any political declaration from any EU institution and will be applicable as of 1 January 2021.


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