Investment Plan must live up to Green Deal's ambitions

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Europe's organised civil society calls for readjustment of EGDIP and JTF

The European Economic and Social Committee (EESC) urges all EU institutions and Member States to continue with a rapid and aligned solidarity-based response to the coronavirus pandemic and to adopt additional measures promoting sustainable investments with a view to the European Green Deal. Member States should swiftly agree on a Multiannual Financial Framework (MFF) for 2021-2027 in line with the Green Deal’s ambitions. 
On 10 June 2020, the EESC adopted an opinion package on the funding of the European Green Deal, the EU’s roadmap to a sustainable economy. In its opinions, the Committee states that the budgetary allocation for the Green Deal, private and public investment, and the efficiency of the EU coronavirus response are all crucial to achieving the United Nations' Sustainable Development Goals (SDGs) and the objectives of the Green Deal. The EESC therefore calls for an adequate budgetary allocation, a comprehensive enabling framework for sustainable investments and a continued EU solidary-based response to coronavirus.
Carlos Trias Pintó, rapporteur for the EESC opinion on the European Green Deal Investment Plan (EGDIP), said: "The outbreak of coronavirus will have a significant impact on our economy, on achieving the Sustainable Development Goals and the Green Deal objectives and on the EU budget. Recovery efforts should therefore focus on the very same objectives. The Green Deal must become the backbone of our economy."

The EESC calls for a reinforced EU budget for 2021-2027

The Committee sees the EGDIP as the first comprehensive policy measure to fulfil the very ambitious targets of the Green Deal but, irrespective of the possible impact of the coronavirus crisis on the future MFF, it is concerned about the budgetary allocation for the Green Deal under the future long-term budget.
The budgetary provisions for the Green Deal under the new MFF are insufficient, said Petr Zahradník, co-rapporteur for the EESC opinions on the EGDIP and on the Just Transition Fund (JTF) and amendments to the Common Provisions Regulation. The next EU budget must live up to the ambitions of the Green Deal and a Recovery Plan. It should be reinforced and its spending ceiling temporarily expanded to 2%. In the EESC’s view, this would provide the financial resources needed and could support the issuing of community bonds as part of a strong recovery plan.
Ester Vitale, rapporteur for the EESC opinion on the JTF and amendments to the Common Provisions Regulation, explained: The budget increase could be made up either by introducing new own resources or by increasing the contributions from the Member States.
In addition to the temporary solidarity measures designed to mitigate the impact of the coronavirus pandemic, the Committee calls for a reinforced European Investment Stabilisation Function and the immediate implementation of the Budgetary Instrument for Convergence and Competitiveness with an increased budget under the next MFF. Increasing the budgetary resources for the Just Transition Mechanism (JTM), which includes the JTF, is equally important.

Civil society proposes measures to raise investments for a just transition

In the EESC’s view, the JTF's financial framework needs to be clearer. The Fund's budgetary provisions will have to be offset by transfers from the European Regional Development Fund/European Social Fund+, co-financing by Member States and substantial private investment as well as the public sector loans facility operated by the EIB. Complementarity of these instruments must be guaranteed.
The EESC is aware that the success of the EGDIP and the JFT depends on a new type of social partnership between the private and public sectors in terms of funding and shared responsibility. This is why the Committee welcomes the proposed new incentives for public and private sustainable investment and financing and supports the improvement of EU fiscal governance.
As regards how to further increase investments, Petr Zahradník said: We need appropriate tax treatment for crowdfunders and donors to complete the stimulus policy. An efficient and integrated Capital Markets Union and Banking Union could also play an important role. The EESC therefore advocates completing Economic and Monetary Union. 
Welcoming the proposed flexibility for state aid rules, Ester Vitale said: State aid should assist the transition to a greener and more inclusive economy. It should be used to promote employment among those who are often cut off from the open labour market. Public investment in environmental protection and climate change should be excluded from the constraints of the Stability Pact.
An investment-enabling framework should moreover provide equal access to information, better public statistical data and support for the identification, structuring and execution of sustainable projects to further enhance sustainable private investment and socially responsible public procurement. Standardisation of taxonomy and non-financial information in the public and private sectors could also ease further engagement.

Civil society must have a say in the just transition

As regards the JTF, the EESC respects and supports the important role played by the regions in programming, governance and implementation. However, it recommends taking account of different levels of preparedness in Member States and regions, different potential for producing clean energy in the EU and different attitudes on the part of individuals and regions towards an active contribution to climate protection.
The social partners and civil society organisations could push for climate-proof spending and should therefore be involved in developing and implementing policies and strategies. This includes active and real involvement in territorial planning, any dedicated JTF programmes and the European Semester. The latter should focus on the SDGs and the Green Deal and apply a more comprehensive EU taxonomy. 


Education and training are key to the transition to a just and green economy

Cohesion policy resources to strengthen and reinvigorate the secondary and university education system should be increased and a substantial portion of JTF resources devoted to generating needed investments to help workers transition from one occupation to another. 
Member States should also enhance financial education programmes by including sustainable finance, said Carlos Trias Pintó. This could further encourage public administrations to introduce tax incentives for public and private investment in green initiatives, which are in the public interest and have a positive social impact, and guarantee informed investment choices by private and public investors.
Lastly, the EESC also notes that environmental and climate investments to support action outside the EU are needed, especially under the Africa strategy.

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