MEPs warn of insufficient control over EU climate spending

Council President Charles Michel listening to the speech of EPP leader Manfred Weber. Weber commented on the new EU budget, saying that "at the moment people are not prepared to swallow this bitter pill." [EU Multimedia Center]

The European Parliament rejected on Thursday (23 July) the hard-won decisions of the EU Council. MEPs criticised, among other things, cuts to climate programmes and voiced fear that billions of euros could fall into the wrong hands. EURACTIV Germany reports.

The Parliament rejected the Council’s decision on the multiannual budget (MFF) and recovery plan by a clear majority. MEPs called the compromise too unambitious and criticised the cuts in climate-related funding.

Some Green MEPs expressed their disappointment in advance of the debate.

The national leaders’ agreement was a “turning away from the Green Deal,” wrote German Michael Bloss. “The European Union must cut back its support programme for CO2-free steel. The programme for investments in the future has been cut by €30.3 billion to now €5.6 billion. The fund to support coal regions purrs together from €40 billion to €10 billion,” he complained.

In a resolution drafted by the group leaders on Wednesday (22 July), the Parliament said, among other things, “we believe that the proposed cuts in programmes for the transition of coal-dependent regions run counter to the Green Deal agenda.”

This refers in particular to the Just Transition Fund (JTF), which the Commission had wanted to increase from €7.5 billion to €40 billion as part of the EU’s coronavirus aid, but which was cut back to €17.5 billion during the negotiations between member state leaders.

Parliament threatens to withhold consent on budget cuts, potentially delaying recovery plans

The European Parliament will adopt a critical stance against the European Council’s recovery plans on Thursday (23 July), opposing cuts to EU-funded programmes in the bloc’s long-term budget while also hitting out at the alleged ‘weak’ nature of rule of law conditionality.

Poland is fighting for coal transition funding

Many MEPs were nevertheless positive about the Council’s promise to reserve 30% of the budget and recovery fund for climate expenditures. The Parliament advocates a share of at least 25% plus 10% for biodiversity.

If an agreement is reached at 30%, up to €547.2 billion could be made available for investments over the next seven years to help achieve the EU’s climate targets. But even that would not be enough. The Commission itself estimates that at least €1.46 trillion must be invested each year to achieve the current 2030 climate targets.

It is unclear, however, whether the 30% relates to the EU budget and the recovery fund together, or whether the necessary share could be covered by only one of the two instruments.

Many MEPs are also concerned about the lack of guidelines for receiving EU aid. Poland, for example, the only EU country that has not yet committed itself to the goal of climate neutrality by 2050, had succeeded in getting the Council to agree that it would still be entitled to at least 50% of the JTF aid.

For Peter Liese, the European People’s Party environmental spokesman, this is unacceptable. “Why should a country receive money for its coal phase-out if it does not accept the goal of climate neutrality,” he said in an interview.

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Stumbling block in the recovery fund

German MEP Delara Burkhardt (S&D) sees the proposal for the recovery fund as a stumbling block. Although climate protection is anchored in the so-called “Recovery and Resilience Facility” (RRF), for which the Council allotted €672.5 billion, the proposal is not a complete success.

The annex to the draft lists seven priorities, which the member states can weight differently. These include investments that “effectively contribute to the green and digital transitions.”

Burkhardt fears that member states “choose the combination of criteria fulfilment in such a way that they would not have to meet any ecological conditions at all. This is especially possible if they instead fully focus on digital transformation.”

It is not yet clear how exactly the recovery fund’s many billions of euros will be monitored. The only stipulation so far is that the member states must submit national investment plans to the Commission, which are based on their national climate plans and the European semester.

The EU taxonomy, an orientation framework for green investments, which is to come into force next year, is not anchored in the recovery plan.

In the Parliament’s draft resolution, MEPs call on the Commission to draw up a “transparent, comprehensive and meaningful follow-up method” based on taxonomy as soon as possible.

Climate policy endures rough EU budget summit

EU leaders agreed to slash funding for Just Transition policies at a crucial budget summit on Tuesday (21 July) and also watered down a set of green conditions that could hamper the bloc’s long-term climate efforts.

Court of Auditors warns against lax controls

Green MEP Rasmus Andresen called for Parliament and the European Court of Auditors to be given a right of veto over the approval of national investment plans. In the past, the Court of Auditors had already denounced the inspection methods of the Commission on several occasions.

In a statement issued in early July, financial supervisors noted that the EU’s climate change spending to date had been overestimated, while negative effects of spending, for example in agriculture, had not been sufficiently taken into account.

On Wednesday, the Court of Auditors made further progress. Even in the previous proposal for the JTF, it said, “the link between performance and financing is relatively weak.” This “poses a significant risk that the JTF will not help to end the strong dependence of some regions on carbon-intensive activities,” it said.

[Edited by Zoran Radosavljevic]

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