Press remarks by Commissioner Hahn on the draft annual EU budget for 2022 and on EU budget performance reporting
(Source: European Commission)
“Check against delivery”
Ladies and Gentlemen,
Just a moment ago, the College adopted the draft budget for 2022 as well as Annual Management and Performance Report of 2020 and I have the honour to immediately present it to you.
It is important to keep in mind where we are.
The COVID-19 pandemic has disrupted our lives and has overturned all previous assumptions about economic activity and public spending.
But today, we can see the light at the end of the tunnel. The vaccination campaign has given people new hope. Europe’s societies are gradually reopening, and the economy is doing better. One of the results from this is that we are here today after 1.5 years.
We are however not out of the woods yet: the Union’s continued response to the crisis and the recovery remain essential.
We must also implement the necessary measures for the twin crucial challenges for the Union: the digital and green transition.
Additionally, in an uncertain world, the Union must maintain its focus on international cooperation, security and defence in line with its values, and play an increasing role externally.
All these priorities are clearly reflected in our draft budget.
The draft budget for 2022 is fully aligned with the multiannual financial framework agreement, which provides a stable framework for economic and social recovery and digital and green transition.
The combined strength of the long-term budget and NextGenerationEU amounts to an unprecedented EUR 2 trillion in current prices over the 2021-2027 period.
Let me now provide you with some – I would say – rather impressive figures for 2022.
A total of EUR 311 billion in commitments would be available in 2022 to provide financing of the EU priorities and policies.
The EU budget would contribute with EUR 167.8 billion in commitment appropriations (this is an increase of 2.2% compared to 2021 without the impact of the Brexit Adjustment Reserve in draft amending budget 1/2021), whereas NextGenerationEU would allow to make commitments of about EUR 143.5 billion in grants.
The proposed level of payments of EUR 169.4 billion is exactly an increase of 2% compared to this year and is adequate to cover our budgetary needs both for the payment of the outstanding commitments and for the new programmes.
Together with the EUR 78 billion of expected NGEU payments – corresponding to the annual amount of borrowing, almost EUR 250 billion will be available to boost the recovery of the EU economy in 2022.
To generate the funding for NextGenerationEU, the Commission will start borrowing as early as June 2021 in a couple of days, using a mix of long-term bonds and short-term EU-Bills.
The first bond issuance will be organised with the institutions included in its Primary Dealer Network as announced almost a week ago last Monday. Two more transactions are foreseen to take place before the start of the summer.
This is now the start of the NGEU implementation phase, which we have prepared.
Before I conclude, let me turn to our performance and policy mainstreaming.
In 2014-2020, the Union invested EUR 216 billion in reaching the climate objectives, exceeding the overall target by 20.15%. We can all be proud of this result!
In the 2021-2027 MFF, we are reinforcing the mainstreaming approach. All basic acts include a recital on climate and biodiversity. Major programmes include specific targets for their indicative contribution, to allow us to reach the 30% target for the budget and NextGenerationEU over the entire programming period.
Notably, the Recovery and Resilience Facility has targets for the percentage of expenditure that should go towards the twin green (37%) and digital (20%) transition.
The Commission intends to fund 30% of NGEU through green bonds issuance. This could amount to up to EUR 250 billion, establishing the EU as one of the largest issuers of green bonds globally. Actually this will lead to doubling of green bonds across the globe, as a result of the Commission taking this approach.
We have also come forward today with a communication about the performance framework for 2021-2027, as well as with the Annual Management and Performance Report.
The Commission will continue to put performance front and centre in the Union’s budget. Today’s Communication on the performance framework for this MFF shows that a sound framework to assess how the EU budget contributes to the EU’s political objectives, is crucial to ensure effective and coherent policy action.
The Annual Management and Performance Report 2020 sets out how EU funding has been used in 2020, including for the COVID-19 response. Also here I refer to all the figures being laid down in the press release. The report demonstrates the substantial contribution of the EU Budget 2020 to alleviate the damaging impact of the COVID pandemics.
To conclude, the draft budget 2022 is an ambitious proposal respecting fully the MFF agreement. Together with NextGenerationEU, it provides a huge boost to the European economy, promotes green and digital transition, and also helps our neighbours and partner countries. Because we are toegether in the fight against the pandemic and future challenges to come.
Finally, I would say we are in a far more comfortable situation compared to last year when we were still negotiating the MFF and did not have the Own Resources Decision in place. This is all now in place and we will start rolling out all our instruments to become more resilient. Budget 2022 reflects all this.
We have come a long way in the past year. Let’s now provide the necessary support to speed up Europe’s recovery.