To enhance the European recovery plan, which will help Europe get back on its feet, the EU has issued the new draft EU budget for 2021. The budget aims to address the pressing economic and social problems, created by the pandemic.
The budget will help kick-start a sustainable recovery and will also add to the creation of new job positions. This will that the people needing help across Europe at the moment will receive a lot of support. At the same time, companies and hard-hit sectors will also be reinforced and will sustain the single market.
Breaking down the budget
The current EU budget along with the Next Generation EU budget will reach a €378 billion funding with approximately €133 billion additional in loans. That budget will help rebuild as well as modernize Europe always in the spirit of the green and digital transitions. The EU wants to create a stronger and more resilient European Union.
This budget will also continue to support the long-standing priorities of the European Union. The EU will remain committed to the six headline ambitions:
- The European Green Deal
- A Europe fit for the digital age
- An economy that works for all
- Promoting our European way of life
- A stronger Europe in the world
- A new push for democracy
The Draft EU Budget and Next Generation EU
The collaboration between the Draft EU Budget and Next Generation EU is set to have great results. Until the end of 2024, the Next Generation EU will be used to exclusively deal with the crisis caused by the pandemic.
The funds it will generate will be channelled through the EU budget to support investment and reform priorities and will reinforce programmes that are key to the recovery. It will also fund actions to build resilience for the future, though, for example, a new Health programme and an enhanced EU Civil Protection Mechanism, RescEU.
Financing under the Next Generation EU
Some of the most important aspects of the entire financial framework will be financed under the Next Generation EU. These actions will need to start as soon as possible seeing as citizens and companies are relying on the EU’s support to try and get back on their feet.
Starting, we see the first 11.5 billion euros being delivered in 2020. The Commission has proposed an amendment to its budget for 2020. The Draft Amending Budget will be agreed by the European Parliament and the Council. After that, it will be implemented.
The full proposal for a revamped EU budget and Next Generation EU should be up and running and supporting Europe's recovery on 1 January 2021. The Commission is working hard with the European Parliament and with the Member States in the Council towards this objective.
What is next?
The European Commission submits the draft 2021 EU budget to the European Parliament and the Council which together take the final decision.
A specific Conciliation Committee is convened, usually in late autumn, to reconcile the positions of the Parliament and the Council. It has to agree within 21 days on a common budget, which both institutions should afterwards approve. This year, the period runs between 27 October and 16 November.
In the meantime, negotiations on the revamped long-term budget and Next Generation EU continue. The Commission will adapt its proposal for a 2021 budget following the agreement by the European Parliament and the Council.
For more information stay tuned with our blog or visit the EU official website.
