The European Commission on Tuesday adopted its first annual report on the implementation of the Recovery and Resilience Facility (RRF), the centrepiece of NextGenerationEU. The RRF is providing up to €723.8 billion (in current prices) of grants and loans to Member States to support transformative investments and reforms that will enable the EU to emerge stronger from the COVID-19 pandemic.
One year on from its introduction, the report takes stock of the progress made in the implementation of the Facility, from the adoption of the RRF Regulation in February 2021 to the disbursement of the first regular payment in December 2021. The report shows that major headway has been made and confirms that the implementation of the RRF is well underway.
The report details numerous examples of the investments and reforms financed by the RRF in the 22 recovery and resilience plans that have been adopted so far. These examples present concrete measures that are contributing to the six policy pillars defined in the RRF Regulation, including the green transition and the digital transformation. The report therefore provides an important insight into the unprecedented scale and impact of the measures that are being implemented across the EU as a result of the RRF.
The Commission and the Member States, along with the European Parliament and Council, have worked closely together to achieve these results.
State of play of implementation.
Following a period of intense preparation and dialogue with each Member State, the Commission conducted its assessment of recovery and resilience plans thoroughly and expediently. The Commission provided a positive assessment of 22 plans. So far, the amount allocated in these plans totals €445 billion (€291 billion in grants and €154 billion in loans).
Following the endorsement of those 22 plans by the Council, the Commission swiftly disbursed €56.6 billion in pre-financing payments to the 21 Member States which had requested it.
So far, five Member States have submitted their first regular payment requests to the Commission, and more than 30 more requests are expected in 2022. The first payment request resulted in the disbursement of €10 billion to Spain in December 2021, and further payments are expected to flow upon the successful completion of the relevant milestones and targets by the Member States.
The Union has successfully raised funds on the capital markets to fund the RRF and issued its first ever green bond in 2021.
Contribution to the climate and digital targets and the six pillars.
The RRF Regulation provides that the reforms and investments included in each of the recovery and resilience plans must reach targets for climate and digital expenditure and contribute appropriately to the six pillars or policy areas of European relevance. The Commission developed methodologies for both objectives, one to report on the targets and one for the six pillars.
About 40% of the plans’ total allocation is related to measures supporting climate objectives and all plans exceed the 37% climate target set in the Regulation. Moreover, the adopted plans allocate 26% of the total amount to digital expenditure. Again, this exceeds the 20% target set out in the Regulation by a significant margin.
In the 22 adopted plans, the total estimated expenditure contributing to the green transition (pillar 1) amounts to €224.1 billion. A total of almost €130 billion of estimated expenditure is allocated to the digital transformation (pillar 2). Measures contributing to smart, sustainable and inclusive growth (pillar 3) account for more than a thousand measures in the 22 adopted plans, for a total of around €223 billion. Measures supporting social and territorial cohesion (pillar 4) amount to €193 billion. Measures supporting health, and economic, social and institutional resilience (pillar 5) amount to €78 billion while measures for the next generation, children and the youth (pillar 6) account for €49 billion.
Progress in the implementation of recovery and resilience plans can be followed on the Recovery and Resilience Scoreboard, an online portal set up by the Commission in December 2021.
One year down the road, I’m very proud to see how the Recovery and Resilience Facility is delivering on our objective. This recovery tool is a transformation tool of our economies and societies. Around 40% of its funding focuses on climate objectives and 26% on the digital transition. This is even higher than our initial objective and a great success. Our European Union will emerge more modern and more resilient from the COVID-19 crisis.
Added value and spillover effects.
The report highlights the added value of the RRF as a unique performance-based instrument, which backs an unprecedented agenda of reforms and investments to address the specific challenges Member States are facing. It projects that the RRF will trigger positive spillover effects across the EU while supporting economic convergence and social and territorial cohesion.
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