MEPs reach political agreement on €5bn Brexit Adjustment Reserve

Funds will cover investments made from 1 January 2020 to 31 December 2023

Photo: EPA

EU legislators reached a political agreement on Thursday on the €5bn Brexit Adjustment Reserve, paving the way for a first payment by December, EP Press service reported. With a budget of €5bn (in 2018 prices - €5.4bn in current prices), the Brexit Adjustment Reserve (BAR) will focus on countries and sectors worst affected by the UK’s withdrawal from the EU. A first instalment of €1.6bn in pre-financing will be available by December 2021. Two other pre-financing tranches of €1.6bn will be paid at the beginning of 2022 and 2023. The remaining €1bn will be paid in 2025.

According to the provisional agreement, three factors will be used to calculate how much money each EU country will receive from the BAR: the importance of trade with the UK, the importance of fisheries in the UK exclusive economic zone and the population living in maritime regions bordering the UK. Ireland will be by far the largest beneficiary in absolute terms, followed by the Netherlands, France, Germany and Belgium.

Member states that depend significantly on fisheries will have to direct a specific percentage of their national allocation to small-scale coastal fisheries and local and regional communities dependent on fishing activities.

Parliament agreed with Council on an extension of the eligibility period to cover expenditure incurred between 1 January 2020 and 31 December 2023 for measures specifically taken to mitigate the expected negative effects of Brexit. The Commission’s proposal limited this period to between 1 July 2020 and 31 December 2022.

On 25 December 2020, the Commission presented its proposal for the Brexit Adjustment Reserve, which will be set up as a special instrument outside of the 2021-2027 Multiannual Financial Framework (MFF) budget ceilings.

Parliament will vote on the provisional agreement in September.

 

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