News

Historic, yes. Future-oriented, maybe.

26 July 2020

Last weekend, heads of states and governments of EU countries gathered in-person for five days at the European Council in Brussels – a walking distance from the Philanthropy House. Many meetings of small groups of leaders took place on the terrace of the European Council building, with photographs capturing the negotiations circulating on Twitter. On this very terrace, a ‘historic’ decision was made regarding the future of the European Union – or at least the upcoming seven years.

The deal has been labelled ‘historic’ for two reasons, amidst the ongoing global pandemic and fears of a second wave across Europe. First, the total agreed sum amounts to 1.8 trillion euros, which is the largest EU budget ever seen. Second, besides the MFF, EU state leaders agreed to raise common debt on the capital markets for the first time through a Recovery Fund named “Next Generation EU”.

 

European Commission President Ursula Von Der Leyen and European Council President Charles Michel. Source: Pool photo by Stephanie Lecocq via Getty Images

 

Standing Together Against All Odds

The agreement has been prepared thoroughly ahead of the Summit and has many mothers and fathers. Along with European Council President Charles Michel French President Emmanuel Macron, German Chancellor Angela Merkel and European Commission President Ursula von der Leyen shouldered the efforts. Other key actors behind the deal were the so-called “frugal four”, consisting of Austria, Denmark, the Netherlands and Sweden. They advocated for responsible EU budget and opposed to handing out €500bn in grants to the countries most severely hit by the COVID-19 pandemic.

Ahead of the meeting, fear was high that no common agreement could be reached because of this opposition. Yet Europe managed to overcome the dividing lines and sent a strong signal to the world that the European Union stands together, that cooperation is possible, despite all diverging opinions and interests, and that this cooperation will be impactful.

EU leaders have agreed to a comprehensive package of €1 824.3 billion, which combines the multiannual financial framework (MFF) and a COVID-19 recovery package under the Next Generation EU (NGEU) instrument. The new MFF will cover seven years between 2021 and 2027.

 

 

 

Infographic: EU Budget 2021-2027 and recovery plan. Source: Council of the EU.

Beyond Recovery and Towards Values

An agreement between heads of EU states who have their national interests in mind, reached in negotiations behind closed doors, is, however, not always a perfect fit for the future of Europe. The more important will be the role of the European Parliament, a directly elected governing institution representing EU citizens, in the upcoming trilogues.

While MEPs discussed the recovery fund in plenary, they criticised that long-term EU priorities such as the Green Deal and digital transition were put at risk and are “prepared to withhold their consent” for the long-term EU budget until a satisfactory agreement is reached in the negotiations between Parliament and the Council – by the end of October at the latest to ensure a smooth start of the EU programmes from 2021.

The Multi-Financial Framework reflects the priorities of the EU institutions and provides important entry points for European philanthropy, ranging from the role public-benefit foundations could play as co-granters, co-investors, re-granters or beneficiaries of the EU funds. Whereas the current proposal by the Council focuses on the recovery from the looming social and economic consequences of the global COVID-19 pandemic, the European Parliament expressed the will to protect future-oriented EU projects in its resolution, which rejects the Council conclusions.

What’s in there for philanthropy?

In line with its Philanthropy Manifesto, the European philanthropy infrastructure has been advocating for a strong EU budget and recovery plan that links up to core European values such as rule of law, democracy and fundamental rights including civic space and that provides entry points for philanthropy as co-granters, co-investors and beneficiaries. It will hence continue to advocate for:

  • protecting the rule of law against illiberal rhetoric and policies
  • showcasing the importance of the Values fund to support civil society
  • strengthening the pan-European areas such as research and innovation as well as digital and green transition
  • ensuring a robust InvestEU programme to enhance and support future-oriented programmes, so much needed in the resilience building phase.

Please find here the list of the European Council meetings taking place until the end of August.