EU may approve Polish, Hungarian spending plans – with conditions – officials

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BRUSSELS (Businesshala) – The European Commission may approve Poland and Hungary’s EU-funded national recovery plans in November, but will set the conditions attached to respecting the rule of law for the release of EU funds, the European Commission said. union officials said.

FILE PHOTO: European Union flags fly outside the European Commission headquarters in Brussels, Belgium March 24, 2021. Businesshala / Yves Hermann

Plans from Poland and Hungary and 25 other EU countries are part of the bloc’s 800 billion euro plan to revive the EU economy after the coronavirus pandemic through grants and very cheap loans to be distributed by 2026.

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If approved, Poland could receive 23 billion euros in EU grants and 34 billion in cheap loans, while Hungary could expect 7.2 billion euros in grants in the coming years.

But while plans for 19 other countries have already been put forward and the first billions have been pre-funded, Warsaw and Budapest have been waiting for months to move forward.

The commission’s approval is stalled because the EU believes ruling parties in both countries are undermining the independence of the courts, the media and non-governmental organizations, and that Hungary has a corruption problem.

Poland’s right-wing nationalist government also refuses to implement the decisions of the EU’s top court.

These deficiencies are listed in what the EU Commission calls country specific recommendations issued annually to all EU members. Addressing these recommendations is a prerequisite for the approval of EU grants and loans under the recovery plan.

To further strengthen the connection between the EU’s respect for the principle of democratic division of power, the bloc agreed to protect EU money from misuse through a special rules-of-law mechanism that came into force on 1 January.

Unhappy over the link between the rule of law and access to EU money, Poland and Hungary challenged the mechanism in the EU’s top court in March, and the commission said it would wait for a decision before implementing the law.

A decision is expected by the end of the year or early 2022.

But under pressure from the European Parliament, which wants the law to come into force as soon as possible, the Commission is likely to launch preliminary legal steps under the mechanism in the coming weeks, EU officials said.

Access to billions of euros from the EU’s recovery fund is critical for the highly Euro-skeptical ruling coalition in Poland, which is seeking to reduce support ahead of the next elections in 2023, as well as the right-wing Fidesz party of Hungarian Prime Minister Viktor Orban. is also important. , who faces election in April 2022.

Reporting by Jan Strupzewski; Editing by Mark Heinrich

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