Ireland to receive €989m from EU Recovery Fund; discussions are currently underway on how the funds will be spent
DUBLIN: Ireland will receive a grant of €989 million from the EU Recovery Fund, the European Union’s largest stimulus package.
Discussions are now underway on how Ireland will utilize the recovery fund, and the government’s objectives. Ireland earned such a big share despite being a small country since it was considered the only EU member to achieve economic growth last year.
The European Commission expects Ireland’s GDP to grow by between 0.3% and 0.5% by 2026 through the Recovery and Resilience Facility.
First instalment is €400m
The first portion of the recovery fund will be €400 million, which will be paid between now and the second quarter of next year. Two more payments of €200 million will be provided in the third quarter of next year, for the years 2022 and 2023, respectively. The remaining amount will be paid by the end of 2024 and 2025. Final payments will be made by the end of 2026.
In order to receive the recovery fund, the procedures of the European Commission have to be completed. The first step is to prepare a detailed plan on how the money will be spent and submit it to the European Union Commission for approval.
Once approved by the Commission, the file will then be presented to the European Council. The Council has four weeks to confirm the decision, after which Ireland must sign a legal agreement and a contract with the EU.
Terms and Conditions
Each plan in the recovery plan must adhere to six pillar objectives. The most important of these is that at least 37% be set aside for climate and sustainability. Twenty percent should be set aside for digital conversion projects. A fundamental principle is that any measures must not cause significant harm. It also stipulates that plans must be formulated in accordance with the development recommendations adopted by all member states in the aftermath of the financial crisis.
Here is Ireland’s recovery plan
Ireland’s plan prioritises three areas: green transition, digital reform acceleration, and social and economic recovery and employment. There are a total of 25 measures, including nine reforms and 16 investments. They will be measured using 109 milestones and targets.
€503m for Climate and greening projects
Climate and greening projects will receive 42% of Ireland’s funding, or €503 million. These include the electrification of the Cork commuter rail line for €164 million, the restoration of 33,000 hectares of peatland for €108 million, and the retrofitting of residential and public buildings for €100 million. There will also be a river basin management plan involving 10 wastewater treatment plants. Climate reforms are also included.
€291m for digitalisation
Digital transformation will receive 32% of the investment (€291 million). €105 million will be spent on the digitalisation of public administration services and €85 million on the digital transformation of Irish enterprises. €64 million for connectivity and ICT equipment in schools and €39 million for the development of a shared Government data centre.
There will also be a number of eHealth initiatives, such as community eHealth solutions, investments in ePharmacy, and an integrated financial management system as part of wider health system reform.
Major digital reforms are addressing the digital divide by ensuring that everyone in education develops the skills to engage in the digital economy and take advantage of the digital transition.
€114m for labour market
€114 million will be spent to empower workers in the labour market for social and economic resilience. Work placement programmes would get €27 million in funding, while higher education at technological universities will receive €40 million.
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