European funds in the fight against Covid-19.March 19, 2020
Hat: European funds in the fight against Covid-19.
Funding Scheme: 2020-03-19
The European Commission will support Belgium in its efforts to fight against Covid-19. 37 million euro will be allocated to protect the Belgian economy against the shock that this epidemic is likely to cause. The allocation of the funds, mainly directed towards Wallonia, is subject to debate in the country. For Welcomeurope, this disparity is revealing of the specificities that can be observed between EU regions in the management of European structural funds.
In the Union, European funds can only be used as co-financing and must therefore be associated with national funds. In Belgium, the co-financing rate from the European Union is generally 50%. The European structural funds are allocated to the EU regions taking into account different criterias, those of development and demography being among the most important. The part of the annual envelopes allocated to the regions that is not used during the year (due to a lack of national projects or fundings) must be returned to the Commission and thus represents a significant shortfall.
Exceptional circumstances, exceptional measures! Faced with the danger that the current health crisis represents for the Belgian economy, the European Union has authorised the Belgian authorities to use the 37 million euro in structural funds that they had to reimburse to the Commission as if it were their national fundings. Wallonia, which was supposed to return more than 17 million euro to the European Commission, is the big winner of this decision, against Flanders, which only had to repay 7 million euro. This inequality seems logical since it depends first of all on the initial amount allocated to each region (Wallonia is the region of Belgium that benefits the most) but also on the more or less extensive use of the allocated funds.
Thus the criticisms that have emerged in Belgium, stressing that the Commission’s aid in the fight against the Coronavirus was not optimal, have been proven. In fact, in these circumstances, Poland receives more funds than Italy, even though the latter is on the front line against Covid-19. Lombardy, one of the richest and most developed regions in Europe, should not be among the main beneficiaries of this reform, even though it is undoubtedly the region most affected by the virus. The irrelevance of this distribution has been acknowledged by the Commission itself and will undoubtedly be counterbalanced by the EU solidarity fund amounting to 800 million euro.