The European Parliament on Friday urged the European Commission to set up a €2 trillion investment package to tackle the fallout from the coronavirus pandemic that would provide “mostly” grants and be financed through recovery bonds.
A total of 505 MEPs voted in favor and 119 against a nonbinding resolution that calls for a recovery fund to be on top of the EU’s long-term budget, financed “through the issuance of long-dated recovery bonds” and “disbursed through loans and, mostly, through grants, direct payments for investment and equity.”
It also warns the Commission against the use of “financial wizardry and dubious multipliers” when coming up with figures for the plan. Nevertheless, the Parliament’s own €2 trillion figure includes both EU spending and an estimated private sector participation.
The Parliament is not formally part of the negotiations on the EU’s recovery plan, but MEPs will have to give their consent to any legislation that is linked to the EU’s long-term budget, the Multiannual Financial Framework. Friday’s vote therefore puts additional pressure on the Commission, which has delayed the release of its recovery plan and is now due to issue its proposal May 27.
Parliament’s text also pushes the Commission to support a greater role for MEPs in the process, with regular meetings between the presidents of the Parliament, Council and Commission to reach a common position on budgetary issues.
“It shows the Parliament’s great will to be a protagonist in this phase,” the assembly’s president, David Sassoli, told journalists after the vote. “It is a good and powerful message to the institutions and the countries.”
Commission President Ursula von der Leyen has outlined a recovery plan that is not far from what MEPs are seeking. Earlier this week, she told MEPs that the plan would have three parts and would be financed by raising money on financial markets, and “all funding would be channeled through EU budget programs and thus subject to parliamentary oversight.” The plan would include grants and “the possibility to front-load part of the investment still this year,” von der Leyen added.
The Commission president also reassured MEPs that she would grant them a crucial role in the negotiations.
“It is essential that the European Parliament plays its full role,” von der Leyen said Wednesday. “For me, it goes without saying that this Parliament must provide the democratic accountability and have its say on the entire recovery package just as it does on the European budget.”
MEPs from the five major political groups voted in favor of the resolution. However, others said the text was too vague and not ambitious enough. “The European Parliament needs clearly defined red lines from which to walk away from EU long-term budget negotiations with the Council, which the resolution approved today has failed to establish,” according to a statement issued by the far-left GUE group.