After the European Parliament, EU Council adopted the Instrument, too.
However, the decision authorizing the Commission to borrow on the capital markets to finance this instrument needs to be ratified in all Member States.
This financial instrument will make €672.5 billion in grants and loans available for public investment and reforms in the 27 member states to help them address the impact of the COVID-19 pandemic, to foster the green and digital transitions and to build resilient and inclusive societies. Member states will receive support from the facility on the basis of their national recovery and resilience plans, which are currently under preparation.
Measures supported and main requirements
Under the new regulation, member states will need to set out in their national recovery and
resilience plans a coherent package of reforms and investment projects, covering six policy areas of European relevance:
- the green transition
- digital transformation
- smart, sustainable and inclusive growth and jobs
- social and territorial cohesion
- health and resilience
- policies for the next generation, children and youth, including education and skills
Support will be linked to country-specific recommendations under the European Semester, which identify central challenges for each member state to address to strengthen competitiveness as well as social and economic cohesion. It will also contribute to the implementation of the European Pillar of Social Rights.
Some of the key requirements concern the EU’s green and digital objectives. At least 37% of each plan’s allocation has to support the green transition and at least 20% the digital transformation. In addition, all measures included in member states’ plans should respect the ‘do no significant harm’ principle, to protect the EU’s environmental goals.
Importantly, member states will also need to ensure that adequate control systems are put in place to prevent, detect and correct corruption, fraud and conflicts of interest.
Approval process and financing: next steps
Member states have until 30 April, as a rule, to submit their recovery and resilience plans to the Commission.
- The Commission will have up to 2 months to assess the plans
- The Council will have 4 weeks to adopt its decision on the final approval of each plan
- Member states will get a pre-financing of up to 13% of the grants and loans provided for in their plan (for the plans approved in 2021)
- The rest of the funds will be paid based on the achievement of the agreed milestones and targets