Thread by @lucasguttenberg

The @EU_Commission just published docs that again show why the Recovery Instrument will end the European Semester as we know it. Instead, the Recovery and Resilience Plans will become the central steering document and will politicise everything.

Thread:
ec.europa.eu/commission/pre…

1/ The Comission will not issue any country-specific recommendations next year for countries that will submit RRPs (that will be all). Also no country reports. Instead, there will just be an analysis of the RRPs that will be the background for the decision to grant RRF money.

2/ This makes sense as it would be weird for the Commission to greenlight a package of reforms and investments in a country's RRP and at the same time ask for different measures in the CSRs. There could be recs under the MIP, but also here I would expect coherence with the RRPs.

3/ This makes the RRP the absolutely central document of economic policy coordination at least until 2023, when the last 30% of RRF funds will be committed. Against this backdrop, it also makes sense that the Commission publishes today "guidance" to member states on the RRPs.

4/ This is unusual as the criteria for granting funds under the RRF is still up for debate between the EP and the Council. That the Commission nevertheless already wants to push member states into certain directions has two reasons: First, there is of course very little time.

5/ But second and more importantly, this is an attempt by the Commission to get ahead of the curve again: Member states have practically already started to spend the money. Both 🇩🇪 and 🇫🇷 have already publically stated that they will fund their recovery packages with it.

6/ Thus this is a delicate two-level game: On the one hand, legislators have not settled on anything, while on the ground, facts are created. If the big member states get away with it, everyone will. That's why today's move by the Commission is a good first step.

7/ The Semester as we know it is practically dead (that is a good thing) and now something new is shaping up. In this new structure, the RRPs will guide everything - and what is put in the RRP will be fundamentally political decisions by member states.

8/ But if this is not to translate into giving blank cheques to member states, as argued before, this will require stronger political control at the EU level by the EP to give the Commission the necessary political backing against member states.

9/ Thus the governance of the RRF and the involvement of the EP still matter: Not only to guarantee that the money in the RRF is spend well, but also to ensure that the new economic governance structure created now will be less intergovernmental and more useful than the last one.