MEPs and European Commission clash over cash payouts from EU’s Recovery and Resilience Facility

The NextGenerationEU programme and its Recovery and Resilience Facility (RRF) have broken new ground for the Union, and MEPs are keen not to blunder their role in it: proper scrutiny and sound legislation

By Andreas Rogal

Andreas Rogal is a senior journalist at the Parliament Magazine

15 Dec 2021

How serious MEPs take their role was confirmed by a press release just ahead of the Economic Affairs (ECON) and Budget (BUDG) committees’ meeting with Commission Vice President Valdis Dombrovskis and Economy Commissioner Paolo Gentiloni on Monday in Strasbourg.

It came from veteran law maker Markus Ferber (DE, EPP), who recently posted a picture of himself and a group of his colleagues on social media, welcoming a freshly elected Chancellor Angela Merkel to the European Parliament for her first ever visit, sixteen years ago.

Ferber, said he was worried that the RRF procedure was not transparent, protesting that “Commissioner Gentiloni cannot manage the RRF like it’s his personal petty cash”.

He was also unhappy with Spain having a first regular payment request granted - as the first Member State and in record time - because it had submitted the requirements, known as milestones and targets, retroactively.

“The 52 milestones that Spain wants to have fulfilled are old projects that were often already implemented before the Spanish government was even granted approval for its [National] plan”, Ferber complained.

He took his grievances to the two Commissioners in person on Monday evening, too, and they painstakingly responded during what was, after all, the fourth Recovery and Resilience Dialogue, “organised under Article 26 of the Regulation establishing the RRF, to ensure greater transparency and accountability in the implementation of the Facility”, as the Parliament’s press release put it.

Markus Ferber (DE, EPP), said he was worried that the RRF procedure was not transparent, protesting that “Commissioner Gentiloni cannot manage the RRF like it’s his personal petty cash”. He was also unhappy with Spain having a first regular payment request granted - as the first Member State and in record time - because it had submitted the requirements, known as milestones and targets, retroactively.

Transparency was just around the corner, as the required reporting and assessment process is setting in, and the electronic scoreboard on which all information will be available, is about to go live online “in the coming days”, Dombrovskis promised.

“We said Wednesday 16 December, but don’t hold me by the neck if it’s a few days later”, he added.

And with regards to Spain, Gentiloni admitted that he, too, wasn’t “enthusiastic about backward-looking projects, but this was the decision taken by [EU Member States] in the Council”, adding that “it was not in the initial proposal, but it was asked for and introduced. And it applies not only to Spain; there are several countries that use this possibility of the legislation”.

As a general update from when the committees and the Commission met for their RRF dialogue in September, Dombrovskis reported that the number of Member States who had their initial pre-financing tranches granted had risen from 16 to 22.

€ 52.4bn has so far been paid out in the pre-financing stage.

Apart from Spain, France has also submitted its first regular payment request which is still under scrutiny.

The five Member States still missing do so for different reasons. Bulgaria and Sweden have only recently submitted their plans, and the Netherlands, in the grip of complex coalition negotiations since the spring which have finally produced a deal on Monday, have not submitted any plans yet.

Hungary and Poland have other issues, and MEPs representing the respective governing parties in Budapest and Warsaw once again accused the Commission of double standards for not approving their RRF plans.

Bogdan Rzońca (PL, ECR) put it to the Commission that, “there are also problems with the judiciary in Spain and Bulgaria, but they get their money”. This was particularly unfair, he complained as, “at the moment we are protecting the EU border, and that is very costly. Is there light at the end of this tunnel?” he asked Dombrovskis and Gentiloni.

Non-attached Hungarian member Enikő Győri claimed that the Commission had not taken into account recent efforts by the Hungarian government such as a newly launched anti-fraud programme, and that the real reason for withholding the funds was political and connected to the country’s recent law “to protect our children”, a.k.a. as the ant-LGBTQI law

The former rejected accusations of double standards, as “all Member States have to fulfil eleven criteria, and one of them is addressing the country-specific recommendations” (CSRs) given in the European Semester exercise.

Dombrovskis also pointed with slight indignation to the fact that the Commission had recently put a “generous package” at the disposal of Poland, Lithuania and Latvia to help with the border crisis.

Gentiloni explained that for Poland, the CSRs included ensuring the independence of its judiciary - something recently highlighted by the European Court of Justice.

He concluded that “we don’t want to discriminate, it is against our mission and also wrong, so we have no interest in it. We have been discussing the issue of an independent judiciary with Poland for months, and the CSRs will hopefully be addressed soon.”

Time had almost run out in the dialogue when ECON committee chair Irene Tinagli (IT, S&D) gave a last catch-the-eye intervention to non-attached Hungarian member Enikő Győri.

She claimed that the Commission had not taken into account recent efforts by the Hungarian government such as a newly launched anti-fraud programme, and that the real reason for withholding the funds was political and connected to the country’s recent law “to protect our children”, a.k.a. as the ant-LGBTQI law.

However, with the same reference to the CSRs as the only criteria being used, Dombrovskis was able to dismiss the last accusation swiftly.

This law, while being looked at by the Commission in an infringement procedure, played no role in the RRF, as it wasn’t part of the CSRs, he explained.

“We are engaging productively with the Hungarian authorities; addressing the country’s CSRs which concern anti-corruption measures, transparency, and law making”, he added.

And a very similar scene played out on a bigger stage the next day, when Hungarian Prime Minister Victor Orbán made the same claim at a joint press conference with French President Emmanuel Macron in Budapest.

The leader of the incoming Council Presidency stepped in to correct his host by saying that the delay had to do with “corruption and public procurement issues”, not the anti-LGBTIQ law.

Plenary debated the state of play of the RRF implementation on Wednesday afternoon.

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