The EU Recovery Plan and municipal services

Thursday, 14 May, 2020

The European Commission will publish its Recovery Plan in the next two weeks which will be linked to the European Union budget. The Commission will propose to borrow money on the capital markets, guaranteed by Member States, that will fund European programmes, following consultation with the European Parliament. The Brussels bubble is full of lobby organisations trying to get a piece of the pie. For us it is clear that funding is required for our social protection systems, to strengthen health and social care, and for our municipalities and other public services.

The Recovery Plan needs to ensure funding is available for municipalities and regions in particular. Many affiliates report that these are facing a sharp fall in revenue due to the decline in tourism and industrial and commercial activities. Municipal and regional authorities are large employers responsible for many of the services that keep our towns, villages and cities going. These can range from water, waste collection, electricity and heating, urban transport and cultural activities (libraries, museums …) to residential, child- and home care,  and services to deal with the most vulnerable in our societies, as well as emergency services like firefighting.

Through public contracts and subsidies municipalities are also indirectly large employers – think of the cultural and entertainment sector. Falling revenues threaten many of these direct and indirect jobs. Easy access to funding is crucial for municipalities and this should be in the form of grants to prevent debt mountains at local level. Municipalities play a big role in procurement and the experience of the 2008-09 financial crisis demonstrated how important public contracts are in boosting the broader economy.

It is a good moment to put (re-) municipalisation of services on the agenda now there is much discussion about bringing industries and supply chains back into Europe. Municipal services can play a role in implementing the circular economy and the Green deal. Our villages, towns and cities can protect jobs, improve quality of services and reduce costs through municipalisation and remunicipalisation. A new report published by the Transnational Institute with the support of EPSU and other organisations has many examples of how this works. You will find more on this in the newsletter.

The European Recovery Plan will also work best if coordinated with other countries and regions like the UK, the Western Balkans, the EU’s Eastern neighbourhood and yes, also with Russia. European countries are each other’s largest trading partners and share a geographical space and environment. All of them need to restart their economies and many need to decide on the strategic investments for the future. There are opportunities in this crisis for Another Europe in which women and men and our environment are not exploited. Stay Safe, Stay Healthy