European Commission proposes €81bn in financial support

24 Aug 20

The European Commission has presented proposals to the European Council to grant financial support of €81.4bn to 15 member states.

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European Commission building

The European Commission building

If agreed, loans will be given to member states under the Support to mitigate Unemployment Risks in an Emergency (SURE) loan facility.

SURE, which was agreed by the council in May, grants loans on favourable terms from the EU to member states in a bid to reduce the negative socio-economic consequences of the coronavirus pandemic.

The commission said the loans will be used for costs directly related to the financing of national short-term work schemes, and other similar measures they have put in place in response to Covid-19.

Ursula von der Leyen, president of the EU Commission, said: “Just four months after I proposed its creation, the commission is proposing to provide €81.4bn under the SURE instrument to help protect jobs and workers affected by the coronavirus pandemic across the EU.

“SURE is a clear symbol of solidarity in the face of an unprecedented crisis.”

The majority of the €81.4bn is made up of requests from Italy and Spain, who have asked for financial support of €27.4bn and €21.3bn respectively.

Loans provided under the instrument will be underpinned by a system of voluntary guarantees from member states.

Each member state's contribution to the guarantee corresponds to its relative share of the total gross national income of the European Union, based on the 2020 EU budget.

The commission said it expects that the process of member states finalising their guarantee agreements with the commission will be completed “very shortly”.

Nicolas Schmit, commissioner for jobs and social rights at the commission, said: “SURE was one of the first safety nets we decided to put in place to guarantee that workers have an income while their jobs have been suspended, and that their employment is preserved.

“All member states will soon have provided a cumulative €25bn in guarantees, and we propose that the 15 member states who requested support receive a cumulated €81.4bn in loans.”

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