Questions and answers: European Commission endorses Belgium's €5.9 billion recovery and resilience plan
How did the Commission assess Belgium's recovery and resilience plan?
The Commission is assessing the recovery and resilience plans based on eleven criteria set out in the Regulation itself. The 11 criteria require an assessment of whether:
-the measures have a lasting impact;
-the measures address the challenges identified in the country specific recommendations or a significant subset of it;
-the milestones and targets which allow for monitoring the progress with the reforms and investments are clear and realistic;
-the plans meet the 37% climate expenditure target and the 20% digital expenditure target;
-the plans respect the do no significant harm principle;
-the plans provide an adequate control and audit mechanism and set out the plausibility of the costing information.
The Commission has summarised its assessment in the proposal for the Council Implementing Decision. The accompanying staff-working document provides detailed documentation on the assessment.
Does Belgium's recovery and resilience plan effectively support the green transition?
The Belgian plan's contribution to the green transition amounts to 50% of its total allocation of €5.9 billion. This exceeds the minimum of 37% required by the RRF Regulation.
Energy-efficient renovations of public buildings, private and social housing represent an important part of the plan's contribution to the green transition. The plan also includes investments into low-emission public transport and a reform to green the company car tax scheme. Investments in R&D and innovation, in particular in alternative energy technologies including hydrogen, will also facilitate the transition towards a low-carbon economy.
The plan will directly contribute to the preservation of biodiversity through investments in protected areas, ecological restoration operations, green infrastructure, more resilient forest management and the creation of wetlands. The implementation of these measures is expected to have a lasting effect on CO2 storage and together with water management measures reinforce climate adaptation. Other investments in recycling infrastructures, support for eco-design projects and to promote the optimised use of materials aim to enhance the circular economy in Belgium.
Does Belgium's recovery and resilience plan effectively contribute to the digital transition?
The Belgian plan's contribution to the digital transition amounts to 27% of its total allocation of €5.9 billion. This exceeds the minimum of 20% required by the RRF Regulation.
The plan contains critical reforms at federal and regional levels that aim to remove regulatory bottlenecks for the deployment of 5G and very-high capacity networks. The plan also includes connectivity public investments, such as deploying fibre and ensuring a higher connectivity for schools in the Walloon Region. Important investments and reforms in the plan are dedicated to e-government across entities, including the modernisation of the outdated digital infrastructure, judicial file management system and network security of the judiciary. Other investments target the digitalisation of specific sectors such as the health system, tourism, transport, energy, media, and culture. The plan aims to better equip schools across the country with digital tools to help improve the digital performance of young people in the primary, secondary and higher education systems. Investments in the plan are also expected to contribute to greater cyber resilience and security of citizens, businesses and public administrations.
There are also measures to address the challenges related to the digital skills targeting digital re-skilling and upskilling of the workforce to help address shortages and to support labour market integration. There are reforms and investments that aim to help companies reap the benefits of the digital transition through the development of a digital and technological innovation hub and digital-related investment in R&D.
Does the recovery and resilience plan represent a balanced response to Belgium's economic and social situation?
The Belgian plan represents a comprehensive and adequately balanced response to Belgium's economic and social situation, thereby contributing appropriately to all six pillars referred to in the RRF Regulation.
Given the specific challenges of Belgium, the particular focus on smart, sustainable and inclusive growth, along with the overall weighting across pillars, is considered adequately balanced.
The plan should have a positive impact on public and private investment, by investing notably in transport and digital infrastructure, social housing, energy-efficient building renovation, and research and innovation. By contributing to a greener and digital economy, the plan supports sustainable growth and economic resilience. The sizeable investment in digitalisation of the public administration and of the justice system should contribute to a business-friendly environment and thereby support the economic recovery. Moreover, the plan helps to address skills mismatches by strengthening education and training systems. The focus on improving digital skills and fostering access to the labour market for vulnerable groups should have a positive impact on employment and contribute to the implementation of the European Pillar of Social Rights.
The Belgian plan includes reforms and investments that focus on improving access to the labour market. For instance, an important number of investments foreseen in the plan are aimed at improving and expanding training offers to facilitate social integration of vulnerable groups (people with a migrant background, the low-skilled, people with disabilities), reducing the digital divide, enhancing career perspectives and orienting the youth towards the jobs of the future and jobs in shortage. This is complemented by investments to modernise the educational system, a reform of the support system for job seekers in Wallonia and reforms to tackle discrimination on the labour market, which is in particular relevant to deal with the low employment rate of people with a migrant background.
The plan further contains several investments aimed at supporting business in various ways, in particular by boosting research and development, developing the circular economy as well as the setting up of innovation infrastructures focused on the green and digital transition.
Finally, the plan includes investments in the renovation and construction of social housing and childcare facilities as well as in improving the accessibility of 25 train stations for persons with reduced mobility. Those investments also contribute to social cohesion.
Do the reforms presented by Belgium effectively address a significant part of the country-specific recommendations issued to it in the context of the European Semester?
The Commission considers that Belgium's plan includes an extensive set of mutually reinforcing reforms and investments that contribute to effectively addressing all or a significant subset of the economic and social challenges outlined in the country-specific recommendations addressed to Belgium by the Council in the European Semester in 2019 and in 2020.
The plan includes relevant fiscal-structural reforms that are expected to improve the quality and sustainability of public finances. Such reforms include the systematic integration of spending reviews in the budgetary planning cycles of all government levels to improve quality and efficiency of public spending. Moreover, a pension reform aims at improving the financial and social sustainability of the pension system, against the background of increasing public pension expenditure.
The plan also includes reforms and investments that address long-lasting labour market challenges. These include measures to promote more effective active labour market policies, to improve the labour market performance and to tackle discrimination in the labour market.
Significant investments are introduced to boost research and innovation, notably via the implementation of more efficient production processes based on emerging energy technologies, the development of alternative production processes in nuclear medicine for cancer treatment, and measures to strengthen the cyber capabilities of small and medium enterprises and to combat cyber criminality. The plan also includes measures aiming at promoting a circular economy and better resource management by setting up new recycling infrastructure to close gaps in different value chains, and by developing alternatives to the use of harmful chemicals, and innovation partnerships.
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