EU economic recovery – Civil society's role needs more clarity

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At the October plenary session, the European Economic and Social Committee (EESC) pointed to the importance of clearly identifying responsibilities in the NRRPs' implementation and to the need for a new emergency economic policy mix, which includes sufficient government spending.

The implementation of the National Recovery and Resilience Plans (NRRPs) in most EU Member States needs clarified governance systems. The distribution of responsibilities between the central, regional and local levels is still unclear. The EESC is sounding the alarm and, in the opinion on the Annual Sustainable Growth Strategy 2021 adopted at its October plenary session and drawn up by Gonçalo Lobo Xavier, stresses that the mechanisms for involving civil society organisations and social partners in the implementation, monitoring and adjustment phases of the NRRPs need more clarity.

The EESC had already flagged up this issue in its February Resolution but the situation remains unchanged despite the European Commission's efforts. The EESC therefore strongly calls for more scrutiny of these crucial aspects of the EU's recovery.

We draw attention to the need to measure progress in implementing the National Recovery and Resilience Plans. We need good monitoring indicators, as they are essential for setting the course of the EU's future development and recovery. Member States have to respond properly to this challenge: we need courage to make citizens aware of the huge difficulties ahead,  said Mr Lobo Xavier during the debate. In this respect, he called for a focus on Member States' capacity to absorb funds and also underlined the need for a strong industrial policy to reduce the EU's dependence on other economic sectors.

Recovery is essential to make the economic system resilient and the next European Semester cycle will be a crucial instrument for the Union to implement the Recovery and Resilience Facility (RRF). The NRRPs include two options: Member States can implement and make radical structural changes under the green and digital transition, and at the same time carry out investment and reforms directly targeting those citizens hit hardest by the crisis.

In the opinion on the Euro area economic policy 2021 drafted by Kristi Sõber, the EESC also points out that the pandemic is not over and the economic repercussions will be felt for several years. A specific and new emergency economic policy mix is therefore needed. The EU and euro area economies are once again growing quickly. At the same time, however, the EU is going through the most challenging period in the economic history of European integration. At this critical juncture, only government expenditure can help alleviate the situation.

The EESC appreciates the swift reaction at EU and national level to counter the pandemic and welcomes the fact that joint efforts have become a substantial part of the recovery strategy. Speaking at the plenary, Ms Sõber said: Especially in the first half of 2020, the Coronavirus Response Investment Initiatives helped alleviate the very difficult economic circumstances, mainly by stabilising markets, jobs and personal incomes. This first step was followed by the NextGenerationEU (NGEU), the robust and highly innovative fiscal contribution. Both initiatives were a quick and flexible response to the pandemic.

The impact of the pandemic has varied from one Member State to another, and this had led to growing divergences. For this reason, the EESC believes that the phenomenon of divergences across the euro area should be carefully taken into account and the weaker fiscal performance deserves a careful response.

Broadly speaking, the Committee is calling for flexibility within a common framework. The flexibility adopted in tailor-made national economic policies and recovery programmes that respect the Member States' specific needs, should also be the approach to the implementation of the NRRPs.

The two opinions have been drawn up as a follow-up to the opinions on the same topic adopted by the EESC in February. They enable the Committee to update its position in light of the evolving COVID-19 pandemic, providing valuable input to the Commission for next year's recommendation on the euro area economic policy and the 2022 Annual Sustainable Growth Strategy.

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