European recovery plan: Brussels calls on the 27 to release the European budget

The EU budget, on which the recovery plan depends, is blocked by Hungary and Poland.

Economy Commissioner Paolo Gentiloni on Wednesday called on the 27 EU member countries to validate the European budget and recovery plan blocked by Hungary and Poland in the midst of the second wave of the health crisis. “I call on EU governments to show a sense of responsibility to their own citizens and to all Europeans at a crucial time. Let’s validate this recovery plan“, He launched.

Budapest and Warsaw on Monday blocked the EU budget and the massive stimulus package painstakingly approved by the Twenty-Seven in July. They have thus opened up a crisis within the European Union at a time when the economy is severely affected by the second wave of the Covid-19 pandemic. Hungary and Poland have vetoed the establishment of a mechanism to deprive countries accused of violating the rule of law of European funds (independence of the judiciary, respect for fundamental rights). These two countries also obtained the support of Slovenia on Wednesday.

For its part, Paris warns that the EU will move forward without these countries if there is no way out, the French Secretary of State for European Affairs said on Wednesday. “Together with the German EU Presidency, we are looking for practical solutions” most “we will look if necessary as a last resort how to move forward without the countries blocking», Declared Clément Beaune in front of the Senate.

Concern for public finances

The European Commission has also expressed concern about public finances in four euro-zone countries, particularly targeting wage increases in hospitals and lower production taxes in France provided for in the 2021 draft budget. “Some measures presented by France, Italy, Lithuania and Slovakia, appear not to be temporary or offset by other budgetary measures», Underlined the Commission in a report, calling to ensure the sustainability of the debt in the medium term, in spite of the health crisis.

Brussels estimates that all the budgets of the Member States for next year, including in these four countries, are “globally onlineWith its recommendations. Given the context of the exceptional crisis, the EU announced in March a suspension of its budgetary discipline rules, inviting the various countries to temporarily let their fiscal deficits slip.

The Commission is still on this line. She calls “euro area member countries to ensure that their fiscal policy continues to support activity in 2021“. But she also asks them to be ready to “reorient these fiscal policies (…) when epidemiological and economic conditions allow it“. Hence the concern expressed for the four countries “pinned“. Brussels asks them to ensure that exceptional measures do not turn into a lasting drift in their levels of debts and deficits.