Drafting national recovery plans: A laborious exercise for Visegrad countries

Slovak Prime Minister Igor Matovic, Polish Prime Minister Mateusz Morawiecki, Hungarian Prime Minister Viktor Orban and Czech Prime Minister Andrej Babis during a press conference after the Visegrad Group prime ministers meeting in Lublin, eastern Poland, 11 September 2020. [EPA-EFE/JACEK SZYDLOWSKI]

The process of drafting national recovery plans under time pressure seems to be a handful for Visegrad countries. Frequent issues include a lack of stakeholder involvement, problems with streamlining different requests and ensuring transparency in the process.

The €672.5 billion Recovery and Resilience Facility (RRF) is the main component of the EU’s €750bn recovery plan from the coronavirus crisis, dubbed ‘Next Generation EU‘.

Member states are currently preparing their national recovery plans (NRP) outlining their priorities for the grants and loans that will be provided under the facility. The focus of the V4 countries is currently on the grant financing from which Poland will get €23.1 billion, Slovakia €5.8 billion, Hungary €4.3 billion and Czechia €6.6 billion.

Czech Republic: Clear vision or patching up ministries’ budgets?

The first “pilot version” of the national recovery plan, was handed out to the European Commission in the middle of October. According to Czech weekly Respekt, Brussels returned the draft to the Czech Republic “after a few weeks”, saying the plan does not represent a way to modernise the country.

According to the Czech ministry for trade and industry, discussions with the European Commission have from the beginning focused especially on “green and digital labelling” of investments and reforms, setting milestones and goals, pricing individual activities, or the macroeconomic and social impacts of the NRP.

The national debate about the NRP was almost non-existent before October. Even Social Democrats, who are part of the ruling coalition, expressed dissatisfaction with the draft. Later on, the process got more inclusive and “a significant number of institutions and organisations were involved in the creation of the NRP,” Marek Vošahlík from the ministry’s press office told EURACTIV.cz. Based on their comments the plan is being reworked, he added.

“Based on criticism from many parties, including tripartite partners, the ministry opened the process and organised a total of six roundtables for a more detailed discussion about the individual pillars of the plan,” said Anna Kárníková, director of the environmental non-profit group Hnutí DUHA (Friends of the Earth Czech Republic).

On the business side, the Czech confederation of industry has confirmed that its representatives regularly negotiate with the Ministry of Industry and Trade about the entire plan and its conditions.

The main criticism is that Czechia does not plan to use the sources for recovery adequately, does not have a clear vision, and wants to “only patch up holes in the budgets of the ministries”.

Poland: Cleaner air opportunity

In Poland, the situation is still unclear. Warsaw has not yet submitted its National Recovery Plan, which was supposed to be handed out last year.

Discussions so far have revealed that the draft plan is highly scattered, uncoordinated and inconsistently carried out, without clearly defined goals. One of the biggest criticisms is its utter lack of transparency. The Ministry of Development Funds and Regional Policy is in charge of selecting projects submitted by regions and other ministries. The selection criteria nor the composition of the working groups that are responsible for the selection of projects are known to the public.

However, there is hope for some improvement. On January 27, the Minister of Development Funds and Regional Policy, Małgorzata Jarosińska-Jedynak, officially announced that the draft plan will be sent for public consultations within two weeks, allowing local governments and other non-state actors to highlight their priorities.

Environmental organisations call upon the Polish government to cover all sectors of the economy to ensure consistency of all policies with the objective of the transition to climate neutrality.

Another pressing issue for Poland that could be addressed with EU support is improving air quality, which is currently the worst on the continent. “We hope that these funds will be released as soon as possible and support the replacement of old heat sources and the improvement of the energy efficiency of Polish homes,” said Andrzej Guła, leader of Polish Smog Alert, an environmental pressure group.

Hungary: Moving from infrastructure to innovation

The Hungarian national recovery plan and the descriptions of the seven Operative Programs (OP) guiding how the resources would be spent are all available online, where citizens, business or civil society organisations are able to assess them.

However, the public consultations have run into problems. Petra Reszkető, a researcher at Budapest think tank ‘Political Capital’ said that the government has not published summaries of OP-level priorities and financial tables. She believes that these practices breach the principles of transparency and predictability, and lag far behind best practices in the EU.

Márton Gyöngyösi, an MEP for the far-right Jobbik party in the European Parliament, said that the ongoing consultation is for “show” only. “Not even the satellite organisations selected for consultation by the government received enough time to make recommendations.” According to him, “this process has not been effective at any time since we joined the European Union.”

István Hegedűs, chairman of the Hungarian Europe Society, underlined that several elements that would constitute a solid public debate are currently missing: discussions in the National Assembly, and events and campaigns that would involve the widest possible range of Hungarian society. “The Hungarian public opinion does not know about the government’s swiftly-developed plans,” he said.

In contrast, the press office of the Ministry for the Prime Minister’s Office told Political Capital that they had recently launched Google adverts aimed at business decision-makers, entrepreneurs, civil society organisations and others, hoping to get them involved in the process. The press office noted that already in 2020 the Ministry had held over 150 online consultations regarding the 2021-2027 plans with the participation of nearly 15,000 experts.

Slovakia: Absorption capacity challenge

In October 2020, the Ministry of Finance, which is in charge of preparing the national recovery plan, published a working document called Modern and Successful Slovakia.

Prepared by experts and without the broad public discussion promised by Prime Minister Igor Matovič (OĽaNO), the document offered a “reform menu”. It very quickly became clear that there is no political agreement in the governing coalition as to which reforms and investments should be inserted into the document that will actually be sent to Brussels as a basis for further debates. Three junior coalition parties (SaS, Sme rodina, Za ľudí) have subsequently all presented their own versions of the recovery plans.

Beyond differing priorities, the biggest concern raised by many politicians and experts is whether Slovakia is actually able to absorb the extra money. For Slovakia, the Recovery and Resilience Fund would mean a 25% increase of public investment in the years ahead. Until 2020, Slovakia was only capable to draw 40% of the 2014-2020 EU budget allocation.

“What I am most afraid of is the ability to use this money so that it does not end as another operation programme that would be extremely rigidly managed thanks to the Slovak and Brussels bureaucracy,” said Štefan Kiss, a top official at the Ministry of Finance and one of the main people behind the Slovak national reform plan.

His team of state analysts prepared a more realistic draft of national reform plan which Slovakia managed to send to the European Commission in late December 2020. A leaked version appeared on the internet on 28 January. Apparently, there was a basic political understanding on the priorities reflected in the text, but the negotiations are still ongoing.

[Edited by Frédéric Simon]

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