EU mulls approving Hungary, Poland recovery plans, with conditions

File photo. Read-out of the weekly meeting of the von der Leyen Commission on the 2021 Rule of Law report. Věra Jourová, Didier Reynders. [Christophe Licoppe/ EC - Audiovisual Service]

The EU is prepared to approve multi-billion-euro recovery plans for Hungary and Poland in the coming weeks, but with strict conditions attached, bloc officials said.

The EU executive, responsible for paying out from the bloc’s €800 billion pandemic recovery fund, has yet to unlock the cash with those two countries, as rows brew over their democratic values.

Speaking on Thursday (30 September) on condition of anonymity, officials said that a highly contested conditionality mechanism that was key to the recovery fund when it was agreed in 2020 could be used in the coming weeks.

This mechanism gives Brussels the power to turn off the money taps over rule-of-law violations related to EU spending. It was fiercely opposed by Warsaw and Budapest, which are fighting the scheme in court.

Hungary, Poland refer controversial rule of law mechanism to court

Hungary and Poland have launched legal action at the European Court of Justice (EJC) against the regulation tying the disbursement of bloc funds to the rule of law situation in EU countries, the court said on Thursday (11 March).

European Commission Vice President Věra Jourová told reporters that the mechanism was “too mature not to be used”.

If the recovery plans are approved, Poland could get €23 billion in EU subsidies and €34 billion in cheap loans, while Hungary can expect €7.2 billion in subsidies.

With regard to Poland, the EU executive is reluctant to sign off on the recovery plan as long as the right-wing government ignores European court rulings on upholding the independence of its justice system.

Poland accuses EU of 'blackmail' over recovery funds

Poland’s justice minister on Thursday (2 September) accused the European Commission of “blackmail” for suggesting the member state’s pandemic recovery funds were contingent on its acceptance of the primacy of EU law over its national system.

Hungary is being asked to commit to anti-corruption reforms, as well as provide better guarantees for the independence of the courts for businesses.

Hungary hits out at Brussels' funding 'blackmail'

The Hungarian government on Tuesday (28 September) condemned what it termed Brussels’ “blackmail” over the allocation of EU funding as differences between the eastern member and the European Union institutions deepen.

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