Tuesday, 28 July 2020
Department of Finance
EU Budget Contribution
227. To ask the Minister for Finance if the net contribution made by Ireland to the EU recovery fund is €15.7 billion in accordance with a document in circulation at the European Council; and if he will make a statement on the matter. [18372/20]
As the Deputy will be aware, on 21stJuly 2020, Heads of State and Government reached agreement on the Post-2020 MFF and recovery plan “Next Generation EU”, totalling €1.82 trillion. Difficult discussions took place over four days. The Government has welcomed this agreement. It is a fair and balanced outcomeand demonstrates that Europe can work collectively to deal with this once-in-a-generation crisis. Council conclusions set out the leaders’ agreement for the European Commission to borrow €750 billion, supporting Member States with €390 billion in grants and €360 billion in loans. Agreement was also reached on a new Multiannual Financial Framework from 2021 to 2027, totalling €1.074 trillion, which will support rural and regional development, and the transformation of our economies in line with the climate transition, research and development, and digital agendas.
Ireland has been a net contributor to the EU Budget since 2014, and this position is set to grow further over the course of the next MFF. In May 2020, the European Commission produced a needs assessment underpinning the proposed “Next Generation EU”. In this needs assessment the European Commission estimated that Ireland’s contributions to the Next Generation EU package would in the region of approximately €18.7 billion over the next thirty years and estimated that Ireland may potentially receive a total of up to €2 billion in grants, with a further €1 billion in loans available up to 2024 should Ireland decide to borrow same. However, these amounts were overtaken by the European Council agreement of 21 July 2020.
We will need to see the European Commission’s official allocation for Member States, but at this point Ireland’s estimated grant allocation amounts to €1.278 billion made up of:
- €177m EAFRD allocation
- €204m React EU
- €44m Just Transition Fund
- €853m Recovery and Resilience Facility (This is only 70% of the total amount available under this Facility, with potential additional grant allocation from the remaining 30% of the Facility to be allocated in 2023 – this could potentially be in the region of a further €300m)
In terms of loans under the NGEU, we estimate that Ireland could potentially avail of approximately €1.4 billion.
Ireland’s contributions to the EU Budget are projected to increase considerably over the coming period in all scenarios as a result of economic growth in recent years.Irish contributions to the EU budget are expected to rise over the coming MFF period from approximately €3 billion in 2021, to over €4 billion in 2027, an average of €3.5 billion.
Exact contributions to the repayment of NGEU borrowing are yet to be determined (and will depend on whether new Own Resources are agreed) but are expected to be significant. At this time of crisis the Covid recovery funds are needed now, but will be paid back over 30+ years.
It is important to remember that Ireland has benefitted greatly from EU membership in economic (single market access), social, environmental, and financial terms (net €40+ billion receipts). We stand ready to demonstrate solidarity with those most in need now.
As the Deputy will be aware, Ireland became a net contributor to the EU Budget in 2014, and since then, this position has grown further. However, at this point in time information on Ireland’s actual net contribution to the EU Budget in 2019 and 2020 is not available.
Ireland’s gross contribution to the EU Budget in 2019 was €2.4 billion. Ireland’s gross contribution to the EU Budget for 2020 is estimated to be €2.7 billion.
Over the coming weeks, my Department will be liaising with all Government Departments in seeking data on EU Budget receipts for 2019, which will be subsequently published in the Budgetary Statistics 2020 report in Autumn 2020. It will be only then that my Department will be in a position to give Ireland’s actual net contribution to the EU Budget in 2019. Receipt data for 2020 will be available in Autumn 2021.