One in every five euros of European funds remains unallocated due to lack of candidates

Alejandra Olcese

Updated Tuesday, January 30, 2024-02:40

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The

Government

had set itself the objective of committing 100% of

European funds

in the form of

subsidies

(the 70,316 million initial allocation) before the end of 2023 and has finally come close, as it has managed to allocate 94% to specific projects. However, although this is the "committed" money (it is known what it will be used for)

the actual execution

- by resolution of calls and tenders -

amounts to only 46%

of the money and, in addition, an

additional problem arises:

remnants

accumulate

of 14,321 million euros, 20.4% of the total.

This means that

one in every five euros

that the State tries to give in subsidies remains unallocated due to lack of interest (few applications) or because the candidates who have presented do not meet the requirements to be beneficiaries, according to the NextGen Observatory presented this Monday by Llorente and Cuenca (LLYC). To date, only the General State Administration (the AGE, the equivalent of the central State) already has remnants of 6,575 million euros that have been accumulated in 2021, 2022 and 2023. To these are added those accumulated by the communities autonomous, which this consultancy estimates at 5,205 million euros, and those that will remain undistributed from the subsidies that remain to be resolved and the money still uncommitted.

"We obtain an estimate of

possible total remainders of 14,321 million euros

from the calls and tenders, 20.4% of the 70,316 million euros of initial allocation of the Recovery Plan," states LLYC, which warns that "if the The percentage of allocation of the autonomous communities is lower, as pointed out by the Government, the remainder that would be generated will be greater. To these figures we must add the 4,045 million in Financial Assets and Loans committed by the AGE with the initial funds of the Plan and that, in the long term, the Spanish Treasury could be reimbursed".

If this money has remained in the drawer, it is because it

has not generated enough interest

or there have not been a sufficient number of potential beneficiaries who met the requirements. The Government - or the communities - will have to re-launch calls with that excess money and, even if they are allocated to different projects,

they will have to pursue the objectives already committed to Brussels.

"If, for example, the subsidies associated with the biogas project have not aroused interest, the remainder may be diverted to hydrogen projects, since they have related objectives, but what will not be admitted is that the funds that had to go intended to promote renewable energies are derived from digitalization or research and development," explains Paloma Baena, director of European Affairs at LLYC.

Although Spain has committed 94% of the funds (66,296 million), it has only executed 46%, which is "the important percentage, because once the award of a project is resolved, the investments are activated and the impact reaches the real economy," they explain. This difference between what was committed and what was executed is mainly due to the aforementioned remainders and

the traffic jam that occurs in the autonomous communities,

which from the beginning did not have sufficient human resources - qualified civil servants - to deploy such complicated funds, among others. issues.

"The General Administration of the State has made a very great effort. They have resolved calls for 78% of what was committed, it is not so bad. Where we can infer that

there are adjudication problems

is in the

autonomous communities

," says Paloma Baena.

The

autonomies

have received

36% of the European funds

- compared to the 40% that was initially intended - and must take care of their management. The problem is that it is not easy to know how much of that money has already been allocated to projects and how much is has been executed, because the communities do not offer this information nor do they upload it in a timely manner in the

Coffee

program , which should serve to know the data with more transparency.

Those that have received the most transfers are

Andalusia

(3,849 million, 15.9%);

Catalonia

(3,524 million, 14.6%); the

Community of Madrid

(2,607 million, 10.8%), and the

Valencian Community

(2,288 million, 9.5%). These are figures that are very far from those of the regions that have received less funds, such as La Rioja (372 million, 1.5%).

One of the criteria that has marked this distribution is the size of

the population

, but it is not the only one. In fact, in terms of European funds received per capita, Ceuta and Melilla are the ones that fare best due to their low level of inhabitants, followed by La Rioja (with 1,175 euros per head), the Balearic Islands (with 830) or the Canary Islands (695 ); while

Madrid

is one of those that

has received the least funds per person

(382 euros), compared to a national average of 508. This is because other criteria have also been taken into account such as need, since the Community of Madrid It is not so much about receiving subsidies aimed at improving the coast, for example, or agricultural activity. Even so, the distribution has sparked political controversy.

Speed ​​up resolution

Dropdown

To improve the execution of funds and be able to deal with all the pending money (33,866 million), LLYC experts propose reforming Public Administrations: simplifying the administrative structure, eliminating redundancies and unnecessary bureaucracies to achieve a more agile and effective system; adopt efficient technologies and improve coordination, promoting collaboration, cohesion and standardization at all administrative levels; and, improve transparency and governance, among others.

"The lack of availability of official and updated data on real execution is an obstacle," they lament. They also believe that it is time for the Government

to start reporting on the impact

that the Plan is having on macroeconomic variables such as GDP or employment, something that they hope the European Commission will also talk about in the report that is scheduled to be published. publish this spring.

In global terms, although Spain is no longer the leader in the deployment of the plan (Italy and Portugal have surpassed us in milestones achieved and disbursements), it is at the top of the classification. In fact, in the EU as a whole, only

15% of the plan's milestones

have been met and

26% of the money

has been disbursed by the end of 2023.

In the

future , various

debates

are on the table

: the possibility of extending the execution deadlines beyond 2026, which seems ruled out; the debate on what to do with the loans that have not been requested (whose added value stands at 91 billion euros); or whether to continue this type of mechanism with a new fund to strengthen the defense or security of the Union.

In Spain, the

public sector

has received 45.1% of the funds, followed by the private sector (with 40.1%) and mixed entities (14.8%). In its distribution, our country has been characterized by an important "

atomization

", that is, that the money has been widely distributed among a multitude of beneficiaries, unlike what has happened in other countries such as

France

or

Italy

, which have concentrated the Most of the funds go to a few recipients, the majority being public entities that then redistribute the money.

In fact, the list of the 100 largest beneficiaries of funds reflects that in Spain these hundred recipients have taken a total of 14% of European funds, while in Germany they have taken 56% and in Italy, 67%. .

Regarding the type of company,

SMEs

have taken 12.3% of the money, while large companies have had 10% in calls and tenders.

So far, Spain has only requested

four disbursements:

three of them it has already received and the fourth (of 10,000 euros) has not yet been authorized by the European Commission because the approval of the

unemployment benefit

reform - which was overturned - is pending.

by Podemos in Congress-. Two options are proposed for the Spanish Government: request a partial disbursement assuming that this milestone will not be met - which could subtract a minimum of 720 million euros, LLYC calculates - or wait until the reform can be approved and opt for the full disbursement. . The Commission allows the deadline to be extended by about six months to be able to approve all the milestones and this is predictably what the Executive will try to do.

According to LLYC experts, the Government is already

"on track" to request the fifth disbursement

(of 7.5 billion) that it has to request in this first semester, in the absence of approving two laws: the Social Services Law and the Family Diversity Law. "The difficulties will come from the sixth disbursement, because there Spain will have to begin to comply with the milestones and objectives agreed in the addendum," they explain. The sixth disbursement, in fact, will be 18.6 billion (3,600 in grants and 15,000 in loans) and is scheduled for the second half of this year.