Continued delays are putting the EU’s €724 billion post-COVID recovery fund at risk, warns a new report from the European Court of Auditors (ECA).
Three years after the creation of a large fund to stimulate recovery after the COVID-19 pandemic, EU Member States have used less than a third of the 724,000 million euros in grants and loans, EU auditors say in a report report published today (September 2).
According to the Court of Auditors, at the end of 2023, Belgium, Finland, Hungary, Ireland, the Netherlands, Poland and Sweden they had not received any post-Covid subsidies.
Almost all Member States have experienced delays in submitting payment claims, either due to political unrest, uncertainty about the rules or national administrative capacity, according to the report.
The Netherlands and Hungary did not sign operational agreements, the first step necessary to access EU funds, while Sweden did not submit any payment requesthe added, and others, such as Netherlandswere held back by protracted coalition negotiations.
Political consensus is one of the keys
“The Recovery and Resilience Plan really needs political consensus and support, and that the Government supports the planand the Netherlands was waiting for that stability,” Ivana Maletić, chief auditor of the EU agency based in Luxembourg, told ‘Euronews’.
In the most complex case of Hungary, the Government of Viktor Orbán has to comply 27 milestones aimed at fighting corruption and safeguard judicial independence, something it has not yet done.
The other four countries (BelgiumFinland, Ireland and Poland) submitted payment requests later than othersso they were still being evaluated by the European Commission, which directly manages and executes the fund, at the end of 2023.
A quarter was not completed on time
Unlike cohesion funds, the usual vehicle for EU regional spending, post-pandemic financial aid is linked to progress in fulfilling commitmentsand the Member States are behind in meeting these objectives and in absorption of funds.
“Timely absorption is essential: it helps avoid bottlenecks in the execution of measures towards the end of the program’s useful life, and reduces the risk of inefficient and erroneous spending,” said Maletić, who led the audit.
Halfway through the six-year implementation plan for these funds, 24% of the planned reforms and investments have not been completed on timemeaning that a significant number of the most difficult promises have not yet been fulfilled, the ECA found.
Given that the Recovery and Resilience Mechanism expires in August 2026 and no extension is expectedEU auditors recommend that the Commission provide more support to strengthen the way in which similar funds are designed in the future.
“It may happen that, for some actions, Member States receive substantial amounts of funds without completing them at all because It will not be possible to complete them within the scheduled time“, declared an auditor in a press conference on Monday, September 2.
However, the community Executive rejected the auditors’ recommendations to stop financing incomplete actions and recover transfers.
“The Commission does not consider progress-based payments to be a risk and has no legal basis for recover funds already disbursed in relation to milestones and objectives already met and to be met,” his response said.
