Considerations on COM(2021)168 - Amendment of decision 2020/1352 granting temporary support to Belgium to mitigate unemployment risks in the emergency following the COVID-19 outbreak

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dossier COM(2021)168 - Amendment of decision 2020/1352 granting temporary support to Belgium to mitigate unemployment risks in the emergency ...
document COM(2021)168 EN
date April 23, 2021
 
table>(1)Further to a request from Belgium on 7 August 2020, on 25 September 2020 the Council granted financial assistance to Belgium in the form of a loan amounting to a maximum of EUR 7 803 380 000 with a maximum average maturity of 15 years, with a view to complementing Belgium’s national efforts to address the impact of the COVID-19 outbreak and respond to the socioeconomic consequences of that outbreak for workers and the self-employed.
(2)The loan was to be used by Belgium to finance the short-time work schemes, similar measures and health-related measures referred to in Article 3 of Council Implementing Decision (EU) 2020/1342 (2).

(3)The COVID-19 outbreak continues to immobilise a substantial part of the labour force in Belgium. This has led to a sudden and severe increase in public expenditure in Belgium in respect of a new measure, namely a new support scheme to small enterprises in the Brussels Capital Region, and other existing regional measures, some of them extended, as referred to in Article 3(d), points (i) to (iv), of Implementing Decision (EU) 2020/1342.

(4)The COVID-19 outbreak and the extraordinary measures implemented by Belgium in 2020 and 2021 to contain the outbreak and its socioeconomic and health-related impact have had and continue to have a dramatic impact on public finances. According to the Commission’s 2020 autumn forecast, Belgium was expected to have a general government deficit and debt of 11,2 % and 117,7 % of gross domestic product (GDP) respectively by the end of 2020. In 2021, Belgium’s general government deficit and debt are forecast to stand at 7,1 % and 117,8 % of GDP respectively. According to the Commission’s 2021 winter interim forecast, Belgium’s GDP is projected to increase by 3,9 % in 2021.

(5)On 11 March 2021, Belgium requested further financial assistance from the Union of EUR 394 150 000, with a view to continuing to complement its national efforts undertaken in 2020 and 2021 to address the impact of the COVID-19 outbreak and respond to the socioeconomic consequences of that outbreak for workers and the self-employed. In particular it concerns the measures set out in recitals (6) and (7).

(6)It concerns a request for support for an extension of existing regional and community income support schemes, referred to in Article 3(d), points (i) to (iv), of Implementing Decision (EU) 2020/1342, of the Brussels Capital Region, the Flemish Region and Flemish Community, the Walloon Region and the French Community:

‘Arrêté du Gouvernement de la Région de Bruxelles-Capitale de pouvoirs spéciaux n° 2020/019 du 23 avril 2020/Bijzondere machtenbesluit van de Brusselse Hoofdstedelijke Regering nr. 2020/019 van 23 april 2020 (3)’;

‘Arrêté du Gouvernement de la Région de Bruxelles-Capitale de pouvoirs spéciaux n° 2020/030 du 28 mai 2020/Bijzondere machtenbesluit nr. 2020/030 van de Brusselse Hoofdstedelijke Regering van 28 mei 2020 (4)’, as extended by ‘Arrêté du Gouvernement de la Région de Bruxelles-Capitale du 15 octobre 2020 relatif à une aide aux secteurs de l’événementiel, du monde de la nuit, du tourisme et de la culture dans le cadre de la crise sanitaire du COVID-19/Besluit van de Brusselse Hoofdstedelijke Regering van 15 oktober 2020 betreffende steun aan de evenementen-, uitgaans-, toeristische en culturele sector in het kader van de gezondheidscrisis COVID-19’ and ‘Arrêté du Gouvernement de la Région de Bruxelles-Capitale du 12 novembre 2020 relatif à une aide aux entreprises débits de boissons et restaurants dans le cadre de la crise sanitaire du COVID-19/Besluit van de Brusselse Hoofdstedelijke Regering van 12 november 2020 betreffende steun aan de eet- en drankgelegenhedenondernemingen in het kader van de gezondheidscrisis COVID-19’. The two extended schemes provide compensation premia to the self-employed and one-person companies in sectors that were forced to close in the context of the COVID-19 crisis;

‘Notification de la réunion du conseil des ministres du gouvernement de la région de Bruxelles-Capitale du jeudi 14 mai 2020/Betekening van de vergadering van de Ministerraad van de Brusselse Hoofdstedelijke Regering van donderdag 14 mei 2020’, as transposed in ‘Arrêté du Gouvernement de la Région de Bruxelles-Capitale du 24 juillet 2020 instaurant une aide exceptionnelle pour les travailleurs intermittents de la culture/Besluit van de Brusselse Hoofdstedelijke Regering van 24 juli 2020 houdende invoering van uitzonderlijke steun voor de cultuurwerkers (5)’;

‘Besluit van de Vlaamse Regering van 20 maart 2020 (6)’;

‘Besluit van de Vlaamse Regering van 10 april 2020 (7)’;

‘Besluit van de Vlaamse Regering van 12 juni 2020 (8)’ laying down a ‘support premium’ to provide a support to enterprises that are open but experience a decrease in turnover of at least 60 % or had to close their business due to federal safety and security measures; ‘Besluit van de Vlaamse Regering van 7 augustus 2020’ (9), ‘Besluit van de Vlaamse Regering van 23 oktober 2020’ (10) and ‘Besluit van de Vlaamse Regering van 13 november 2020’ (11).

Those three Flemish Government Decrees referring to schemes, also called respectively ‘Flemish Protection Mechanism 1, 2 and 3’, amending certain of the aforementioned decrees provide support to enterprises that are open but experience a decrease in turnover of at least 60 % or that had to close their business due to federal safety and security measures;

‘Arrêté du Gouvernement de la Communauté française de pouvoirs spéciaux n° 4 du 23 avril 2020 (12)’, ‘Arrêté du Gouvernement de la Communauté française du 7 avril 2020 (13)’; ‘Arrêté ministériel du 8 avril 2020 portant exécution de l’arrêté du Gouvernement wallon du 20 mars 2020 (14)’; ‘Arrêté du Gouvernement wallon du 19 juin 2020 (15)’;

The aforementioned measures pertain to schemes that provide income support to the self-employed, one-person companies, and other types of employees who do not qualify for other kinds of income support. In particular, the compensation premia for companies and for entrepreneurs in the Brussels Capital Region, the nuisance, compensation and support premia in the Flemish Region and the Flemish Community, and the compensation premium for business closure in the Walloon Region provide generalised one-off support for companies and the self-employed which needed to close their activities due to COVID-19 or faced a substantial reduction in turnover.

Where the measures target a wider range of beneficiaries, only the amounts for expenditure related to the support of the self-employed and one-person companies have been requested. Other measures (the compensation premium for intermittent workers in the Brussels Capital Region, the nurseries subvention and the cultural operators subvention in the French Community, the training activities in the Walloon Region, and the cultural operators and self-employed subvention) target the self-employed and workers with no access to the temporary unemployment scheme in specific sectors (cultural and care sector, training activities).

(7)Support is also requested for a new measure from the Brussels Capital Region. It concerns ‘Arrêté du Gouvernement de la Région de Bruxelles-Capitale du 3 décembre 2020 concernant l’octroi d’une subvention de 1 625 000,00 EUR à la SA Brusoc dans le cadre de l’octroi de micro-crédits de trésorerie pour les indépendants et les micro-entreprises en raison de la crise sanitaire du COVID-19/Besluit van de Brusselse Hoofdstedelijke Regering van 3 december 2020 betreffende de toekenning van micro-kaskredieten voor zelfstandigen en zko’s’. In particular, the measure provides micro credits to entrepreneurs and one person companies in Brussels Capital. Only the part of public expenditure related to the expected losses on loans has been requested. The amount requested for expenditure relates only to the support of the self-employed and one-person companies.

(8)Belgium fulfils the conditions for requesting financial assistance set out in Article 3 of Regulation (EU) 2020/672. Belgium has provided the Commission with appropriate evidence that the actual and planned public expenditure has increased by EUR 10 103 933 459 as of 1 February 2020 due to the national measures taken to address the socioeconomic effects of the COVID-19 outbreak. This constitutes a sudden and severe increase because it is related both to new measures and to existing measures directly related to short-time work schemes and similar measures, some of them extended, that cover a significant proportion of undertakings and of the labour force in Belgium. Belgium intends to finance EUR 1 906 403 459 of the increased amount of public expenditure through its own financing.

(9)The Commission has consulted Belgium and verified the sudden and severe increase in the actual and planned public expenditure directly related to short-time work schemes and similar measures referred to in Belgium’s request of 11 March 2021, in accordance with Article 6 of Regulation (EU) 2020/672.

(10)Financial assistance should therefore be provided with a view to helping Belgium to address the socioeconomic effects of the severe economic disturbance caused by the COVID-19 outbreak. The Commission should take the decisions concerning maturities, size and release of instalments and tranches in close cooperation with national authorities.

(11)Belgium and the Commission should take this Decision into account in the loan agreement referred to in Article 8(2) of Regulation (EU) 2020/672.

(12)This Decision should be without prejudice to the outcome of any procedures relating to distortions of the operation of the internal market that may be undertaken, in particular pursuant to Articles 107 and 108 of the Treaty. It does not override the requirement for Member States to notify instances of potential State aid to the Commission under Article 108 of the Treaty.

(13)Belgium should inform the Commission on a regular basis of the implementation of the planned public expenditure, in order to enable the Commission to assess the extent to which Belgium has implemented that expenditure.

(14)The decision to provide financial assistance has been reached taking into account existing and expected needs of Belgium, as well as requests for financial assistance pursuant to Regulation (EU) 2020/672 already submitted or planned to be submitted by other Member States, while applying the principles of equal treatment, solidarity, proportionality and transparency,