Cohesion policy action against coronavirus

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The Coronavirus outbreak presents a major challenge to the entire European Union. National, regional and local communities are on the frontline in countering the disease. Solidarity and responsibility across our societies and between Member States will be key to overcome this challenge. The benefit of collective and coordinated action as a community outweighs individual and parcelled responses. We have to take action to contain the spread of the virus and mitigate its impact to prevent straining public healthcare while reinforcing the responsiveness of our systems and to mitigate the considerable knock on effects on our economies.

The Commission has, therefore, launched two packages of measures: the Coronavirus Response Investment Initiative (CRII) and the Coronavirus Response Investment Initiative Plus (CRII+). These measures mobilise cohesion policy to flexibly respond to the rapidly emerging needs in the most exposed sectors, such as healthcare, SMEs and labour markets, and help the most affected territories in Member States and their citizens.

The European Commission made a series of proposals (CRII package) on 13 March 2020 to amend legislation that will allow Member States to benefit from more financial back-up and targeted assistance. The European Parliament voted almost unanimously in favour of the Commission proposals on 26 March. The Council has finally adopted the package on 30 March 2020, which entered into force on 1 April 2020.

On 2 April the Commission proposed a new set of exceptional measures introducing extraordinary flexibility and simplification, support for the most deprived and for the fishing industry – the Coronavirus Response Investment Initiative Plus (CRII+). This new package was adopted by the European Parliament on 17 April and is currently under discussion at the Council.

The firepower

Thanks to the Coronavirus Response Investment Initiative, Member States can immediately address three key priorities in the fight against the current emergency and its economic consequences: spending on healthcare, support to short time work schemes, and support to the SMEs working capital.

To make this money available, the Commission proposed to mobilise quickly cash reserves from the EU funds. This will provide immediate liquidity to Member States' budgets and will help to frontload the yet unallocated €37 billion of cohesion policy funding within the 2014-2020 cohesion policy programmes, thus providing a much needed boost to economic investments.

The Commission is also making all Coronavirus crisis related expenditure eligible under cohesion policy rules. It will also be applying the rules for cohesion spending with maximum flexibility, thus enabling Member States to use the funds to finance crisis-related action. This also means providing greater flexibility for countries to reallocate financial resources, making sure the money is spent in the areas of greatest need: the health sector, support for SMEs, and the labour market.

The EU Solidarity Fund will provide additional assistance of up to €800 million to the worst affected countries in order to alleviate the financial burden of the immediate response measures.

The second legislative package - Coronavirus Response Investment Initiative Plus, will allow that all non-utilised support from the cohesion policy funds can be mobilised to address the effects of the public health crisis on our economies and societies. Certain procedural steps linked to programme implementation and audit will be simplified in order to grant flexibility, ensure legal certainty and to reduce administrative requirements. These include the possibility to apply 100% EU co-financing rate to the relevant operational programmes and additional flexibility to transfer resources between the cohesion policy funds, and between categories of region.

The work of the country teams

At technical level, the work with the relevant national administrations has already started and is progressing very well. The Commission has established a Task Force to serve as a one-stop shop for questions about the implementation of the initiatives. A digital platform for swift exchange on their questions is now up and running and already counts over 300 questions that are promptly treated and replied. The dedicated country teams have also started their work of identifying specific needs and designing the appropriate measures, also involving State Aid, EU financial rules and support from the European Investment Bank. Contacts are already taking place in order to take, swiftly, all the necessary steps.

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