The agreement to receive the multimillionaire community funds incorporates a very detailed monitoring of the Government’s steps
The large package of European aid leaves the management of at least 80% of the bulk of the financing in the hands of governments. This has forced Brussels to establish strict monitoring and control mechanisms with officials assigned directly to each country. Technicians who verify the fulfillment of the committed milestones and objectives and who remember those ‘men in black’ of the past financial crisis, although without the same stigmatizing burden. Because they will be in all EU countries.
The point is that the work of its senior officials (two of them already traveled to Madrid last October) have to follow every step that Spain takes on the 416 milestones and objectives, most of which are related to the 2021-2023 period. , which the Government has to comply with in order to receive the 60,000 million euros of direct aid that it has requested in different sections.
The so-called ‘operational agreement’ (an extensive document of 343 pages) signed this week between Madrid and Brussels, not only allows to release the 10,000 million of the first tranche for achievements, which will be added to the 9,036 million already entered in the form of an advance. It also establishes in detail the protocol that will be followed to oversee longer-range commitments. And how the dialogue between the Government and the European Commission has to be.
Quarterly and ‘ad hoc’. Unlimited meetings
The General Secretariat of European Funds of the Ministry of Finance and Public Administration will pilot all the work. Its ‘coordinator’ will be obliged to hold “quarterly exchanges” with community officials. “They can take place in person in Spain or in Brussels”, it is specified, but also by videoconference or by exchange of writings.
There will always be a permanent item on the agenda: the schedule of payment requests (a total of eight disbursements). And the Commission requires the ‘coordinator’ to assess and report accordingly “of any significant risk · on that timetable. The control will be such that even Brussels can require Spain to convene technical meetings in which it would be present with heads of government entities in charge of implementing the reforms.
European semester. The decisive vigilance
The key to the whole process will be in the European Semester. Established to monitor and coordinate the EU’s budgetary, fiscal, economic and social policy, it is in this case the decisive surveillance cycle. Here Spain has for years now duties that it has to fulfill, such as the reform of the labor market (with a deadline of December 31 of this year for its approval) or that of pensions, set at the end of 2022. it will require as definitive proof the publication in the BOE “accompanied by a summary document that duly justifies how the milestone was satisfactorily met.”
The annual event. Brussels is also explained
The European Commission and Spain will have to hold, in addition to all the meetings already planned, an annual event with the participation of those responsible for the implementation of the recovery plan. The objective, “to discuss the complementarity, synergy and coherence” between the aid and its application of the aforementioned plan and the other programs of the Union. Also every year the European Commission is accountable to Parliament and the Council with a report on the progress made with the recovery and resilience plans; the volume of allocated revenue and how the collection is going.
Access to all data. Absolute transparency
And very important. Transparency. Full access to information. The agreement dedicates an express point to this. ‘Spain will ensure that, upon request, the Commission has full access to the relevant underlying data supporting the due justification of the payment request, both for the evaluation of the payment request and for audit and control purposes. The Coordinator will provide this information to the Commission. ‘ Spain will have to make a duly justified request for each of the disbursements it requires. And any change in the operating agreements must be agreed upon by both parties.
Breaches. Suspension of aid
From here, the assumptions. If the milestones and targets are not satisfactorily met, Commission officials might recommend a drastic move: ‘Suspend payment of all or part of the financial contribution’. The Member State concerned may submit observations within a period of one month. If in six months you have not taken the necessary measures to correct the situation, the Commission will cancel the amount of the financial contribution.
And what would happen if you ask to highlight milestones and objectives? Here a mechanism is foreseen that would overlap with the previous one. Initially, “objective circumstances” are required to justify the non-compliance in whole or in part, including intermediate objectives and relevant targets. The country would be obliged to present to the Commission a reasoned request to modify or replace the commitments; even “a modified or new recovery plan.”
If the Commission considers that the alleged reasons justify it, it will examine the new plan so that it complies with the fundamental principles of the extraordinary fund. That is: the measures contribute to growth, create jobs and guarantee economic and social resilience; that the destination of 37% of spending to the green transition and 20% to the digital one is equal or exceeded; and that in no case will there be a negative impact on the environment.
Brussels will have four months to evaluate the new proposal from the moment it is officially presented. If you don’t get their approval, things get complicated here. One month for the Member State to submit observations. And in the most extreme case, even the return with interest of the items already received.
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