The EU’s pandemic recovery fund risks being derailed after an outcry within the bloc that Poland is set to be one of the biggest recipients despite its government’s attacks on the judiciary and LGBT community.
The Polish economy has been one of the least affected by the coronavirus crisis and Warsaw has faced heavy criticism over its approach to the rule of law but estimates suggest Poland will still only be behind Spain as the major winner from the rescue fund.
A series of analyses circulating among the member states, obtained by the Guardian, has enraged a number of governments, with the European council president, Charles Michel, lobbied in recent days by at least two prime ministers including the Danish leader, Mette Frederiksen, to rethink the distribution of EU money and toughen the conditions on funding.
Initial European commission plans for a mechanism to withhold funds from EU governments that endanger the rights of its citizens are now set to require the support of a qualified majority of member states after being weakened earlier in the negotiation.
“It is hard to understand and accept given the situation in Poland came nowhere near the scenes of human suffering we witnessed in Italy and Spain,” said one senior EU diplomat. “Poland is making a mockery of our values and gets rewarded for it. That is unacceptable. Southern Europe bears the brunt of the Covid crisis, the migration crisis and the climate crisis but somehow ends up empty-handed.”
The EU’s 27 heads of state and government will meet in Brussels on 17 July for the first time since February in an attempt to secure agreement on how the bloc intends to finance Europe’s recovery from what is set to be the deepest recession since the Great Depression.
The commission is seeking backing to borrow €750bn (£680bn) from international capital markets of which €560bn will fund economic reforms in member states through a mixture of grants and loans.
Under the latest calculations, the Polish government is to be handed around €37bn in Covid-19 rescue grants and make an expected contribution of €21bn, leaving it as a net recipient of €16bn.
Italy is due to receive €81.8bn net, but make a contribution of €59bn, leaving it a net gain of just €22bn through grants despite 34,000 deaths and its economy facing a fall in GDP this year of 9.5%.
Belgium will also receive some of the lowest grants under the proposed formula despite having experienced the worst per capita fatalities in the EU, according to the European centre for disease prevention and control.
In light of the figures, there is growing resistance to both the weakened rule of law mechanism and the European commission’s decision to include a country’s average unemployment rate between 2015 and 2019 in the allocation algorithm.
The concerns over the need for safeguards has been further fuelled by the reelection campaign of Poland’s president, Andrzej Duda, who has spent recent weeks attacking the country’s LGBT community, warning Poles to be vigilant against “foreign” attempts to undermine their traditional values and identity.
Duda’s claims echoed the strategy of his allies in the Law and Justice (PiS) party during last year’s parliamentary elections when it secured a second term in power.
NGOs claimed that municipalities accounting for a third of Poland, the EU’s sixth biggest economy, have declared themselves as an “LGBT-freezone”, where resolutions have been passed against so-called “LGBT ideology”.
In response to criticism of the distribution of the EU’s recovery fund, the European commission president, Ursula von der Leyen, has said that the money should be used to build greater resilience in the least wealthy member states.
The commission also said it will introduce EU taxes to finance the recovery fund to ensure countries such as Italy and Spain do not need to contribute into it as heavily as the current forecasts predict.
There are significant doubts, however, that the proposed new taxes on carbon emissions and plastics will come to fruition given the resistance by a number of member states, including Poland.
“A country that trampled the rule of law, shuns responsibility on climate, shows no solidarity in migration and is making a mockery of the claim that the EU is a community of values sees the money ship sailing in,” one senior EU diplomat said. “We are talking about a country whose president is seeking re-election on the promise to impose gay-free zones. It’s concerning that the EU finds no better way of dealing with this situation. Not a pretty picture.”