How did the Commission assess Portugal's first payment request?
On 25 January, Portugal submitted to the Commission a request for the disbursement of € 1.16 billion under the Recovery and Resilience Facility (RRF). The request was based on the achievement of the 38 milestones and targets for the first instalment, as outlined in the Council Implementing Decision approving the plan. They cover reforms in the areas of health, social housing, social services, investment and innovation, qualifications and skills, forestry, the blue economy, bio-economy, renewable gases (including hydrogen), public finances and public administration. Several targets also concern investments in the areas of infrastructure, decarbonisation of industry. enterprises 4.0 and digital education.
With their request, the Portuguese authorities provided detailed and comprehensive evidence demonstrating the fulfilment of the 38 milestones and targets. The Commission has thoroughly assessed this information before endorsing the positive preliminary assessment of the payment request.
What are the next steps?
The Commission has now sent the positive preliminary assessment of Portugal's fulfilment of the milestones and targets required for this payment to the Economic and Financial Committee (EFC), asking for its opinion. The EFC's opinion, to be delivered within maximum four weeks, should be taken into account in the Commission's assessment. The Commission will adopt the decision on the disbursement of the financial contribution, in accordance with the examination procedure, through a comitology committee. Following the adoption of this decision by the Commission, the disbursement to Portugal would take place. The amounts disbursed to the Member States will be published in the Recovery and Resilience Scoreboard. The Commission has also shared its positive preliminary assessment with the European Parliament.
How do the milestones and targets achieved by Portugal so far effectively support the green transition?
In this payment request, the green transition is supported by specific reforms, such as the entry into force of a new general waste management regime, the entry into force of the legal framework on compulsory tenure of rural land in forestry areas and the Decree-Law on the establishment of the integrated management system for rural fires. Investments include new dwellings and energy-efficient renovations in the public housing stock in the Azores, as well as the launch of tenders for innovative projects to help decarbonise industries. While in general in this first payment request, most of the investment-related milestones and targets concerned the early stages of those investments, like the launch of calls for projects, two exceptions were targets for the finalisation of new constructions and renovations that required the assessment of detailed evidence provided. There is also a reform setting the condition for the injection of renewable hydrogen and other renewable gases in the national gas transmission and distribution network. Further, a call for innovative projects to produce renewable hydrogen and other renewable gases was launched. Finally, a reform supporting the implementation of the Innovation Agenda for Agriculture 2030 promotes R&I targeted to the needs of the agricultural sector, helping the green transition.
Steps are also taken with the entry into force of the revision of the acts strengthening the financing capacity and innovation of the blue economy.
How do the milestones and targets achieved by Portugal so far effectively contribute to the digital transition?
While milestones and targets related to the digital transition are more concentrated in subsequent payment periods, some flagship measures are already included in the first payment request. Crucially, steps were taken to improve the digitalisation of public administration, to support the digitalisation of the education system and to establish Digital Innovation Hubs to promote the digitalisation of companies. An investment was also launched to better help people with disabilities participate in society by providing a set of digital information tools and services.
How do the milestones and targets achieved by Portugal so far contribute to improving Portugal's economic and social situation, and its resilience?
Portugal implemented a number of milestones that are part of important social and economic reforms. These include, among others, the adoption of a national strategy to combat poverty, of a national strategy for the inclusion of persons with disabilities, the simplified social equipment regime that promotes de-institutionalisation by enabling alternative forms of care, the entry into force of a mental health Decree-Law, which shall set out the principles for the organisation of mental health care services, as well as the approval of action plans for disadvantaged communities in Lisbon and Porto. Portugal also implemented reforms to make R&D investment more efficient and effective; to improve academia-business linkages to enhance knowledge flows and technology transfer; and, to strengthen the agricultural sector, inter alia, by tackling the effects of climate change, including mitigation measures and support to other activities, such as, agricultural services and tourism. The reform of cooperation between higher education and public administration and enterprises is expected to foster collaborative arrangements, responding to labour market needs and the twin transition.
Does the achievement of these first milestones and targets contribute to an effective implementation of the plan?
The milestones and targets fulfilled constitute significant steps in the implementation of Portugal's recovery and resilience plan, and of its broader reform agenda, as a number of them contain important legislative steps that pave the way for the reforms and investments that are planned for the later implementation stages of the plan. Beyond those mentioned above, these include steps relating to Portugal's national promotional bank, Banco Português de Fomento, which will help to provide capital to viable Portuguese companies. The first payment request also includes a crucial step towards strengthening the quality and sustainability of public finances with the coming into force of a new management contract template that should increase the performance, responsibility and accountability of public managers appointed to the Boards of Directors of state-owned enterprises.
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