40% of EU budget should be dedicated to greening the economy

40% of EU budget should be dedicated to greening the economy

The EU’s next multi-annual budget (2021-2027) should dedicate 40% of spending to the low-carbon economy and high-quality jobs, said Rudy de Leeuw, a delegate at the European Economic and Social Committee (EESC), an EU advisory body.

“Europe needs to green earmark a significant share of current investment schemes as well as add an additional €200 billion,” de Leeuw told the press in Brussels on November 8.

This means the EU has to mobilise more than a trillion euros (€1,115 billion) over the 2021-2027 period in order to put the bloc on a low-carbon economy pathway, he specified.

De Leeuw was referring to an EESC opinion for a European Finance-Climate Pact, adopted in the wake of a landmark IPCC report which showed that warming beyond 1.5C will unleash a frightening set of consequences that can only be avoided with an in-depth global economic and social transformation.

“The next multiannual financial framework (2021-2027) must promote economic development and jobs and enable the EU to achieve its objectives and contribute to the transition to a low-carbon economy by 2050,” the EESC opinion reads.

“In a business-as-usual scenario, the changes in climate expected by 2080 would make households across the EU €190 billion worse off each year at constant prices, if no adaptation measures are taken,” it adds.

The EESC’s opinion was published ahead of crucial negotiations to finalise the adoption of the EU budget for the period 2021-2027.

Its proposed 40% earmarking for climate action is almost twice bigger than the European Commission’s own proposal. When it tabled its long-term budget proposal in May, the EU executive suggested dedicating 25% of EU spending on the low-carbon transition, up from 20% in the previous period (2014-2020). The European Parliament, for its part, proposed a 30% target.

Just transition

De Leeuw said the aim of the EESC’s finance-climate pact is to redirect into the real economy the vast amounts of money currently flowing into financial bubbles.

“This transition would bring the necessary transformation in the labor market and could contribute to the creation of high-quality jobs in the framework of the European Pillar of Social Rights,” the opinion reads.

The EESC rapporteur said it was about creating high-quality jobs, but also to make sure a new job is created each time one is being suppressed.

The EESC will be attending the COP24 via two side-events where the European institution is to promote the role of civil society in taking up climate action.

Original source: EURACTIV
Published on 9 November 2018