Hungary and Poland are blocking the European multi-annual budget and the recovery fund because of the mechanism linking the disbursement of funds to respect for the rule of law. This has been learned from diplomatic sources.
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During a meeting of the ambassadors of the 27 member states, Poland and Hungary oppose an agreement in principle on the new multi-year budget until 2027. It provides for around 1,100 billion euros in European expenditure from 2021 to 2027. The two Member States also blocked the start of the national ratification procedures necessary to roll out the EUR 750 billion recovery plan. This fund should have paid out subsidies to the member states from next spring, but it can only come into effect when the national parliaments have approved the increase in the so-called own resources of the EU. The EU needs that increase to be able to borrow the money to finance the fund.
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All in all, this involves more than 1,800 billion euros that the European Union wants to spend in the coming years to help the economy recover after the corona pandemic. Poland and Hungary block approval of the package out of dissatisfaction with a mechanism linking the disbursement of funds to respect for the rule of law.
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“If the European Union wants to violate the treaties, if agreements made at the top of the heads of government are not respected, Poland will not be able to agree to the budget,” said Chancellery Chief Michal Dworczyk earlier today. radio station RMF.FM.
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The mechanism developed to link the disbursement of funds to the rule of law threatens, according to Dworczyk, to lead to “completely arbitrary decisions by European officials and politicians, affecting certain countries and favoring others”.
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Justice Minister Zbigniew Ziobro said the rule of law criterion is “just a pretext” that will encourage “institutional and political slavery” and “a radical curtailment of sovereignty”.
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Blackmail
Previously, Hungarian Prime Minister Viktor Orbàn had already threatened to block. That position has not changed, according to a government spokesman. “It is not Hungary that blackmails and puts pressure on Brussels (…) but vice versa,” Justice Minister Judit Varga wrote on Facebook.
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In early November, the German EU Presidency and the European Parliament had reached a compromise on the introduction of a mechanism to stop the disbursement of funds to member states that violate the rule of law.
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However, both Poland and Hungary argue that the deal goes beyond the general principles agreed by the Heads of State or Government in July. Both countries have been under attack for years for allegedly violating European fundamental values of democracy and the rule of law.
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Poland and Hungary do not have a blocking minority to thwart the approval of the mechanism, but they can block the multi-annual budget and the recovery fund. After all, the budget must be approved unanimously, and the fund cannot be launched until all national parliaments have agreed to the increase in the EU’s own resources. Both countries have now used that power to block the multi-year budget and the recovery fund.
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“Serious political crisis”
The German EU Presidency had already announced that in this case it would like to submit the entire package for approval at a meeting of the ambassadors of the member states. The blockage threatens to plunge Europe’s recovery strategy into “a serious political crisis,” warned a European diplomat. According to diplomats, German Chancellor Angela Merkel, European Council President Charles Michel and European Commission President Ursula von der Leyen will consider next steps. The deadlock will probably be discussed on Thursday during a video conference of the government leaders that was scheduled to discuss the corona crisis.
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In any case, the blocking will delay the multi-year budget and the recovery fund to be rolled out next year. Hungary nevertheless has the prospect of more than six billion euros from that fund, Poland about 23 billion euros. “Nobody knows what Orbàn wants (…) we feel he is not fighting for money,” said another European source.
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