Written answers

Thursday, 30 July 2020

Department of Finance

Covid-19 Pandemic Supports

Photo of Matt CarthyMatt Carthy (Cavan-Monaghan, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

319. To ask the Minister for Finance the estimated amount Ireland will contribute in total to the EU Covid-19 response recovery fund announced by the European Council; and if he will make a statement on the matter. [20261/20]

Photo of Matt CarthyMatt Carthy (Cavan-Monaghan, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

320. To ask the Minister for Finance the estimated amount Ireland will receive from EU Covid-19 response recovery fund announced by the European Council; the amount that will be comprised of grants and loans, respectively; and if he will make a statement on the matter. [20262/20]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I propose to take Questions Nos. 319 and 320 together.

As the Deputy will be aware, on 21July 2020, Heads of State and Government reached agreement on the Post-2020 Multiannual Financial Framework (MFF) and Next Generation EU, totalling €1.82 trillion. Difficult discussions took place over four days but the Government welcomes 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 MFF from 2021 – 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.

In May 2020, the European Commission produced a needs assessment underpinning the proposed Next Generation EU. In this needs assessment the European Commission estimate that Ireland’s contributions to the Next Generation EU package would be in the region of approximately €18.7 billion over thirty years and estimated that Ireland would 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. The amounts in this needs assessment have been overtaken by European Council conclusions, as agreed by leaders on 21stJuly although Ireland remains a significant net contributor to the recovery fund.

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 €300m)

Further receipts should be available to Ireland under competitively awarded programmes but amounts are difficult to estimate at this point.

In terms of loans under the NGEU, we estimate that Ireland could potentially avail of approximately €1.4 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.

Comments

No comments

Log in or join to post a public comment.