European Commission endorses Ireland’s recovery and resilience plan

The European Commission has today adopted a positive assessment of Ireland’s recovery and resilience plan. This is an important step towards the EU disbursing €989 million in grants under the Recovery and Resilience Facility. This financing will support the implementation of the crucial investment and reform measures outlined in Ireland’s recovery and resilience plan. It will enable Ireland to emerge stronger from the COVID-19 pandemic.

The RRF is at the heart of NextGenerationEU which will provide €800 billion (in current prices) to support investments and reforms across the EU. The Irish plan forms part of an unprecedented coordinated EU response to the COVID-19 crisis, to address common European challenges by embracing the green and digital transitions, to strengthen economic and social resilience and the cohesion of the Single Market.

The Commission assessed Ireland’s plan based on the criteria set out in the RRF Regulation. The Commission’s analysis considered, in particular, whether the investments and reforms set out in Ireland’s plan support the green and digital transitions; contribute to effectively addressing challenges identified in the European Semester; and strengthen its growth potential, job creation and economic and social resilience.

Securing Ireland’s green and digital transition

The Commission’s assessment finds that Ireland’s plan devotes 42% of the plan’s total allocation to measures that support climate objectives. This includes measures supporting energy efficiency, sustainable mobility, biodiversity and ecosystems.

The Commission’s assessment of Ireland’s plan finds that it devotes 32% of its total allocation to measures that support the digital transition. This includes measures enhancing connectivity, supporting the digitalisation of the public administration and of enterprises and contributing to up-skilling in the educational system.

Reinforcing Ireland’s economic and social resilience

The Commission considers that Ireland’s plan includes a set of mutually reinforcing reforms and investments that contribute to effectively addressing a significant subset of the economic and social challenges outlined in the country-specific recommendations addressed to Ireland. It includes reforms in the areas of social and affordable housing, health, pensions and the business environment. At the same time, it introduces measures that are expected to partially address challenges in the areas of anti-money laundering and aggressive tax planning. The plan includes investments to stimulate research and innovation, promote private investment as well as targeted measures to develop skills and support employment.

The plan represents a comprehensive and balanced response to the economic and social situation of Ireland, thereby contributing appropriately to all six pillars referred to in the RRF Regulation.

Supporting flagship investment and reform projects

The Irish plan proposes projects in the seven European flagship areas. These are specific investment projects which address issues that are common to all Member States in areas that create jobs and growth and are needed for the twin transition. For instance, Ireland’s plan provides €155 million to renovate residential and public buildings and to support businesses that improve their energy efficiency so as to reduce the country’s greenhouse gas emissions.

The assessment also finds that none of the measures included in the plan significantly harm the environment, in line with the requirements laid out in the RRF Regulation.

The control systems put in place by Ireland are considered adequate to protect the financial interests of the Union. The plan provides sufficient details on how national authorities will prevent, detect and correct instances of conflict of interest, corruption and fraud relating to the use of funds.

Members of the College said:

President Ursula von der Leyen said: “I am delighted to present the European Commission’s positive assessment of Ireland’s recovery and resilience plan. The Irish plan presents a well-balanced mix of reforms and investments that address the key challenges facing Ireland. It places a particularly strong emphasis on the green and digital transitions, with investments in sustainable rail transport in Cork, the connectivity of rural schools across the country. And Ireland plans to improve the resilience of its healthcare system. As you say in Ireland, a good start is half the work. We will stand by you every step of the way. Together, we will make these ambitious projects a reality.”

Valdis Dombrovskis, Executive Vice-President for an Economy that Works for People, said: “This plan represents a significant effort by Ireland to address the challenges it faces, and get on a greener and more digital path. We welcome the focus on reducing regional differences, such as by helping companies in remote rural areas. The plan will help to speed up the decarbonisation of the Irish economy with reforms to reduce fossil fuel use and investments such as retrofitting older buildings. Ireland intends to prepare its workforce and schools for the future with better digital skills and boost the digitalisation of its public administration, schools infrastructure and businesses – especially smaller ones. In addition, it is taking some steps to address areas of its tax system that facilitate aggressive tax planning, and to improve supervision and enforcement of anti-money laundering rules. Once put into full effect, this plan will allow Ireland to emerge stronger from the crisis.”

Paolo Gentiloni, Commissioner for Economy, said: “While Ireland was the only EU Member State to enjoy positive GDP growth last year, we all know that the pandemic and the necessary containment measures took a heavy toll on the domestic economy. Today’s decision brings Ireland a step closer to receiving almost €1 billion in grants under NextGenerationEU. This money will support key reforms and investments over the coming five years, helping the country’s recovery and boosting its progress towards a more sustainable future.”

Next steps

The Commission has today adopted a proposal for a Council Implementing Decision to provide €989 million in grants to Ireland under the RRF. The Council will now have, as a rule, four weeks to adopt the Commission’s proposal.

The Commission will authorise further disbursements based on the satisfactory fulfilment of the milestones and targets outlined in the Council Implementing Decision, reflecting progress in the implementation of the investments and reforms.