The CoR wants the MFF to support investment at local and regional level, set up a crisis response reserve and provide financial resources for the just transition, including for automotive regions.
Two years after its adoption, it is clear that the EU Multiannual Financial Framework (MFF) 2021-27 does not offer sufficient responses to current crises such as the consequences of Russia’s invasion of Ukraine, high inflation and the sharp rise in energy costs. The mid-term review of the long-term budget, planned by the European Commission for 20 June 2023, should therefore address regions' and cities' emerging needs and promote economic, social and territorial cohesion. These are the main demands discussed by CoR members with leading MEPs and included in an opinion adopted at the 24 May plenary session.
European local and regional authorities are responsible for half of public investment, one third of public expenditure and a quarter of tax revenues. That is why they are key partners in improving the design and implementation of funding programmes, helping to address resources where they are really needed.
In a debate with the two Co-Rapporteurs in the European Parliament, CoR members called for a substantial review of the EU's current €1.2 trillion
Multiannual Financial Framework, which covers a seven-year period from 2021 until 2027. The updated MFF should take new challenges on board – such as strong inflation and the high cost of housing - and provide additional resources to address them, local leaders argued.
Vasco Alves Cordeiro (PT/PES), President of the European Committee of the Regions said: "An ambitious European Union should be supported by an ambitious MFF. We expect therefore the mid-term revision of the MFF to be bold so that it can reflect the emerging needs and priorities of local and regional authorities. Likewise, it should confirm the role of Cohesion Policy as the main investment instrument covering all regions in Europe."
Margarida Marques (PT/S&D), Member of the European Parliament and
co-rapporteur on the same report, said: "Since the very beginning of the current MFF we have been re-prioritising spending expenses. Cohesion is not an emergency Fund. No amount of re-prioritisation is going to cover the needs or remedy the MFF’s shortcomings. This is why we are asking for an upscaled MFF. A Budget fit for the increasingly important role the Union is playing. We call for an additional permanent instrument so that the EU budget can better adapt and quickly answer to upcoming and emerging needs and challenges."
Jan Olbrycht (PL/EPP), Member of the European Parliament and
co-rapporteur on “upscaling” the MFF 2021-2027, said: “The current MFF no longer answers needs of the Union since it was designed before many unforeseen crises hit the Union. Now, less than two years after its adoption, the EU budget is already stretched to its limits. There are no margins left in many headings which significantly restricts what the EU can do to tackle unpredictable crises. Therefore, a simple review is not a solution for the current challenges - we urgently need a solid revision of the MFF.”
Local and regional leaders called for the MFF to contribute to overall economic, social and territorial cohesion through a balanced distribution of resources. In doing so, it must also ensure that small municipalities have equal access to funding. Moreover, CoR members underlined that the objectives of Cohesion Policy can only be achieved if resources are focused on long-term investment and not constantly used to respond to crises, as has been the case in recent months and years.
Thomas Habermann (DE/EPP), District Commissioner of Rhön-Grabfeld and rapporteur of the
opinion on the MFF mid-term review adopted at the plenary session, said: “European funds are helping municipalities and regions across Europe to implement the necessary measures on the ground. This applies, amongst others, to the accommodation and integration of refugees, climate protection measures, digitalisation and demographic change. And European funds, together with the national contributions of the member states, will also be indispensable in the reconstruction of Ukraine. I call on the European Commission to undertake a fundamental revision of the current Multiannual Financial Framework in view of the current crises. We must ensure that the levels responsible for implementing EU rules have the necessary financial resources at their disposal. Strengthening the European Union budget alone without simultaneously supporting subnational budgets cannot and will not suffice.”
The opinion suggests that a comprehensive crisis response reserve should be set up in the MFF. If not used by the end of the budget period, the reserve should be invested, under the relevant fund, to strengthen crisis prevention at the local and regional level.
Finally, CoR members underlined that the focus should be on making the most efficient and effective use of resources through improved coordination, consistency and consolidation of funding programmes, while reducing complexity and administrative burden on local and regional authorities.
On 2 May 2018, the Commission submitted legislative
proposals for a new MFF for the period 2021-2027. In the wake of the COVID-19 outbreak, on 27 May 2020 the Commission put forward the recovery plan
NextGenerationEU that included revised proposals for the MFF and own resources, and the setting up of a recovery instrument worth 750 billion euros. In September 2022, the President of the European Commission confirmed in a
letter of intent that a review of the MFF will be put forward in 2023.
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