Opening remarks by Commissioner Hahn at the Annual Budget Conference 2021
(Source: European Commission)
“Check against delivery”
Ladies and Gentlemen,
Dear fellow budget fans,
It is a great moment for all of us to be here together, and for the first time since a couple of months. At least some of us can participate in person in this important conference.
It is an extraordinary budget, based on an extraordinary multiannual financial framework (MFF), unique in itself, but in reaction to the specific circumstances.
Success has many parents – and in this case, it is fortunately true. Many of you contributed – and together we found an adequate and appropriate answer to an unprecedented challenge: a record stimulus package of more than €2 trillion – multiplying the impact of the long-term budget with the firepower of the NextGenerationEU.
This budget translates Europe’s visions and values into concrete action and is our blueprint for the future: for a European Union where citizens and companies thrive.
Therefore, this budget together with NextGenerationEU symbolises innovation on many levels. First it reflects the evolving nature of the Union, and the further integration of the Union in many areas. Of course, it is based on a common understanding; it does not mean that each and everything has to be decided at the European level. As we always see, crises are a trigger for certain developments and we have to acknowledge them and reflect them adequately in the budget. Secondly, it embodies innovative power – reflected by its design and funding structure and it is thus strengthening our Union as a whole.
Facing the Corona crisis, Europe proved solidarity: we immediately mobilised all flexibilities and means to protect lives and livelihood: by supporting healthcare, by creating a safety net for workers and businesses and by activating the general escape clause of the Stability and Growth Pact so Member States had more room for manoeuvre.
At the same time, we knew: we needed more firepower to boost recovery and resilience. In this situation, the ongoing negotiations on a long-term budget offered the opportunity to re-design the multiannual financial framework as a state-of-the-art budget for the Europe of tomorrow.
While the Union’s budget gradually evolved along with the European integration process, the current budget means a quantum leap. As a Minister of Sciences, a couple of years ago, my physicists always said “Do not use this notion” as for them, quantum is a very small unit but in budgetary terms, it has a different meaning, so that is why we stay with the acknowledgement that the current budget indeed means a quantum leap.
It not only reacts to current challenges but also anticipates the crucial transformations we are facing. Therefore, climate action and digitalisation are at the heart of our action – and we will make sure this twin transition is also fair. COP26 shows how important it is that Europe leads by example.
Inspiring others is also in our own interest: we need to invest in green and digital technologies: to create the jobs of tomorrow and to save Europe’s role on the global stage, because as a first-mover we can set standards.
In this spirit, more than 50% of the multiannual financial framework and NextGenerationEU will go to new priorities, such as research and innovation, space, health – strengthening also our strategic sovereignty.
NextGenerationEU has broken new ground: it allows the Commission to issue bonds – on a large scale –– backed by the EU budget to help the EU to emerge stronger from this Corona challenge. That means the Union can incur debt supporting all Member States to fight the crisis and build resilience.
Without giving too much away of the dedicated session on the European Union as an issuer, I can proudly state that our diversified funding strategy is a success story: We have already raised enough funds to cover all remaining needs by the end of the year – while the interest in our EU bonds and bills remains high.
That is the power of the European promise, which also strengthens the international role of the euro, with a further political impact
At the same time, we have decided to modernise the revenue side of the budget. New Own Resources will help to repay NextGenerationEU borrowing and to ensure that the EU budget can be up to the challenge without unduly burdening Member States.
This will strengthen the European Union in the long term – as we will discuss in a session later this morning.
For me, it is also a significant leap that the budget more than ever embodies our values.
We introduced a conditionality regime to protect the Union’s financial interests and respect the rule of law. It will complement existing tools, and form an additional layer of protection of the EU budget. This allows the budget to serve the taxpayers even better – as President von der Leyen will certainly highlight in her speech later on.
Our stimulus package has already shown the power of Europe as a learning Union: While it took 8 years to recover from the previous crisis, we expect all countries to be at or above pre-pandemic growth levels by the end of next year.
NextGenerationEU has played a central role in this: The markets understood our recovery programme not only as a signal of solidarity but also of strength.
By designing our repayment with a long-term horizon, we send the clear message: our Union is here to stay. We further underpinned our credibility by matching our funding with our political goals.
Our success proves us right, as we have already become the biggest issuer of Green Bonds, together with many of our Member States. So far, 11 Member States have already issued Green Bonds, and at least another three already announced to do it next year.
This conference is an important moment to take stock of all the budgetary milestones we have achieved so far. With this stimulus package, Europe unfolds the power of 27: being forward-looking and innovative, our Union has all reasons to be self-confident.
But of course, we must not rest on our laurels – or as Heraclitus would have said: “Nothing endures but change”. This is also true for the budget.
Our Union will certainly face new challenges and we need your innovative thinking, your ideas as experts, policy makers and scholars to anticipate the budgetary solutions for tomorrow. So I am looking forward to reflecting together on the Union as an issuer, on the empowering impact of our own resources and on the evolving nature of the Union budget. Discussing with you on the future of the EU budget is also a discussion on the future of Europe, and the other way round, discussing on the future of Europe has an immediate effect on the budget, because, as we know, the budget is our policy cast in figures. If we are clear on what our political priorities are, on what the task of the Union should be, in and for Europe, but also on a global stage, this has to be reflected in an adequate budget.
Ok, we have just agreed on the current MFF, but I am sure, that people have started to think about the next MFF. And from our perspective, it is never too early to start thinking about the next MFF and to build on our current experience and I hope that today’s conference can already launch this kind of necessary reflection.
And with this, I would like to hand over to our President von der Leyen, whom I warm-heartedly thank for her keynote address.