Sounds like a deal!

July 22, 2020, 3:12 pm

After more than 90 hours of negotiations, the longest-ever European Council ended on the dawn of Tuesday 21 July with 68 pages of Conclusions and a compromise deal on the “Next Generation EU” Recovery Fund and the new Multiannual Financial Framework (MFF) 2021-2027.

Following four nights of talks, Heads of State and Government of the EU Member States agreed on an unprecedented 750 billion euros plan to respond to the social-economic fallout of the COVID-19 pandemic. While the overall amount of the financial envelope is kept as in the May 27 proposal of the European Commission, the ratio between loans and grants changes. The new Recovery Fund will be composed of 390 billion euros in grants (instead of 500) and 360 billion euros in loans (instead of 250), money that will for the first time be jointly borrowed on the financial markets. All figures are to be intended in 2018 (constant) prices. 

All in all, this is a tale of two budgets. On the one hand, we have the Recovery Fund, which has been welcomed as a historical milestone and a sign of a Union well equipped to confront together the consequences of the pandemic. On the other hand there is the “ordinary” seven-year MFF which was decreased from the original proposal of 1.1 trillion euros to 1.074 trillion euros. In addition, some of MFF long-term programmes (including Horizon Europe) will not receive or will receive little top-up funding from Next Generation EU that had been initially proposed by the Commission. If the whole package lives up to the expectations of a rescue plan for Europe, it does certainly not address the resilience challenge, many have noted.

The decrease in the MFF figures is being opposed by the European Parliament, which has been vocal in the past two years about a 1.3 trillion euros MFF. On Thursday 23 July it approved with an overwhelming majority a resolution on the matter, urging the Council of the EU – represented by the German rotating presidency – to engage immediately in constructive negotiations to improve the proposal. 

Despite cuts through the MFF, Creative Europe, the only EU programme dedicated to transnational cultural cooperation, is brought back to 1,64 billion euros, same level of funding as in the Commission proposal of May 2018. This is a +7% in comparison to the figure (1,52 billion euros) that the Commission had put forward two months ago.

It is, of course, a very modest and a bittersweet increase – yet it goes in the right direction, following  the plea made by thousands of voices from the cultural and creative ecosystem and beyond. The online petition initiated in June by Culture Action Europe and endorsed by many networks, organizations, artists, and individuals, had reiterated the call of the European Parliament, which has for years asked for a doubled envelope for Creative Europe (i.e., 2.8 billion euros) “a chronically under-financed EU programme, despite its great potential”. Such a call has also been recently supported by some national Culture Ministers, namely Germany, Italy and France.  

Despite its future-oriented vision, no extra money from Next Generation EU has been channeled specifically to Creative Europe (or other programmes targeting new generations and more resilient societies, such as Erasmus+). 

Now the ball is in the Parliament’s court: MEPs’ consent on the MFF proposal cannot be taken for granted, and the Assembly will fight hard to have its red lines taken into account. According to the Parliament’s political leaders, targeted increases on top of the figures proposed by the European Council must single out flagship programmes in the fields of – among others – climate, digital, youth, culture, and solidarity, including Creative Europe.

Member States will however remain in the spotlight, as they will be responsible to draft the national implementation plans to make use of the new resources coming from the Recovery Fund. It is on them to fully include culture in their national strategies and make sure that the historical rescue package for the EU’s recovery will ultimately benefit Europe’s most precious asset.

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