After the plenary of the European Parliament backing the report on InvestEU, Auditors say that impact of EFSI may be overstated.
On 16 January 2019, the plenary of the European Parliament (EP) approved the report on InvestEU elaborated by the Committees on Budgets (BUDG) and Economic and Monetary Affairs (ECON). The EP report increases the expected contribution of InvestEU to climate objectives to at least 40% (from 30% in the proposal of the European Commission (EC) and calls for a stronger alignment with other dimensions of the Sustainable Development Goals. While the BUDG and ECON Committee plans to keep the rate for provisioning at 40%, the Industry, Research and Energy Committee asked for a lower provisioning rate of 35%. The EP also plans to slightly increase the EU budgetary guarantee attributed to the windows for SMEs (window III) and social investment and skills (window IV), raising the investment triggered to roughly €700 billion. The EP also aims to strengthen synergies with Horizon Europe and Digital Europe. In particular, it intends to regard the number of projects emerging from these programmes that go on to be supported under InvestEU as an indicator for evaluation of the programme.
InvestEU shall bundle the EU’s financial instruments for repayable forms of support under one umbrella. It shall mainly build on the European Fund for Strategic Investments (EFSI), the heart of the Juncker Plan, which recently was assessed very positively in November in an EC review. However, the European Court of Auditors found that this review did not sufficiently substantiate the claims. Apparently, in areas such as energy and transport, EFSI has been crowding out other financing sources because it offered better conditions to beneficiaries. The auditors highlight that EFSI delivered on easing the financing of more risky projects by the EIB, but less than was set out as a target. They confirm that EFSI in general has been successful but question the number of €360 billion in additional investment as was previously advanced.
Already in 2017, the High-Level Expert Group on Sustainable Finance pointed out that the Juncker Plan was triggering less investment in projects effectively delivering on climate targets than expected. InvestEU shall therefore concentrate more narrowly on the stimulation of investment along the EC’s political priorities.