EU COMMISSION PLANS EUR 100 BILLION CORONAVIRUS SOLIDARITY FUND

The EU Commission proposed to set up a EUR 100 billion coronavirus solidarity fund, to help businesses stay afloat and workers keep incomes, and redirect structural funds to coronavirus response.

According to the Commission, the coronavirus outbreak is testing Europe and the depth and breadth of the crisis requires a response unprecedented in scale, speed and solidarity. There is a need for a strong and flexible long-term EU budget, so the Commission intends to work out a strong budget that helps the EU get back on its feet and progress on the path to recovery. These measures are based on the current EU budget and will squeeze out every available euro.

With a new SURE solidarity instrument, the Commission will mobilise €100 billion in loans to countries that need it to ensure that workers receive an income and businesses keep their staff. This allows people to continue to pay their rent, bills and food shopping and helps provide much needed stability to the economy. The loans will be based on guarantees provided by Member States and will be directed to where they are most urgently needed. All Member States will be able to make use of this but it will be of particular importance to the hardest-hit.

SURE will support short-time work schemes and similar measures to help Member States protect jobs, employees and self-employed against the risk of dismissal and loss of income. Firms will be able to temporarily reduce the hours of employees or suspend work altogether, with income support provided by the State for the hours not worked. The self-employed will receive income replacement for the current emergency.

Finally, the Commission has decided that all uncommitted money from the three Cohesion Policy Funds – the European Regional Development Fund, the European Social Fund and the Cohesion Fund – will be mobilised to address the effects of the public health crisis. To make sure that funds can be re-directed to where they are most urgently needed, transfers between funds as well as between categories of regions and between policy objectives will be made possible. With this, the Commission intends to join forces with Member States to save lives and protect livelihoods.