Brussels (Brussels Morning) EU member states are set to receive five billion euro to mitigate the social and economic impact of Brexit. The decision was reached by the European Parliament’s Regional Development Committee yesterday, with the adoption of the Brexit Adjustment Reserve (BAR).
Negotiations will now start with the Council on the final shape of the mechanism. The draft report was approved by 35 votes in favour, one against and six abstentions.
“We must ensure that EU aid reaches the countries, regions, companies and people most affected by Brexit. European companies already suffering from the COVID-19 crisis shouldn’t pay twice for the Brexit debacle”, MEP Pascal Arimont (EEP) contended.
The fund worth five billion will be set up as a special instrument outside of the 2021-2027 Multiannual Financial Framework budget ceilings, the Parliament said.
MEPs want the resources to be disbursed in three tranches: pre-financing of four billion euro in two equal installments of two billion euro in 2021 and 2022 and the remaining one billion euro in 2025.
Finally, distribution of the funds should be made on the basis of expenditures reported to the European Commission, taking pre-financing into account.
“This reserve is very important and needs to be paid out as soon as possible, on the basis of statistical and measurable data”, Arimont maintained.
According to the new system, Ireland would emerge as by far the largest beneficiary in absolute terms, followed by the Netherlands, France, Germany and Belgium.
MEPs demanded that financial and banking entities benefitting from the UK’s withdrawal from the EU should be excluded from receiving support from the BAR.
Aid eligibility has to be specifically related to the withdrawal of the UK from the EU, including, support to SMEs, the self-employed, small-scale fisheries and local communities dependent on fishing activities in UK waters.
EU citizens who have left the UK will also be eligible for aid to help them reintegrate.
Parliament is expected to confirm its draft mandate to initiate the BAR during its first plenary meeting, in June.