Sweden’s recovery plan within the EU Recovery and Resilience Facility
In July 2020, EU heads of state and government agreed on a recovery package to mitigate the effects of the crisis. The package, called NextGenerationEU, comprises EUR 750 billion (2018 prices) in loans and grants to Member States. The main part of this will be channelled through the Recovery and Resilience Facility (RRF). On 28 May 2021, Sweden submitted its recovery plan to the EU.
Member States apply for funding through national recovery plans that outline the reforms and public investments they intend to implement. Member States can apply for both grants (a total of EUR 312.5 billion in 2018 prices) and loans (a total of EUR 360 billion in 2018 prices).
Which measures are included in the Swedish plan?
Sweden’s recovery plan contains 30 reforms and investments, divided into five components:
- Green recovery.
- Education and transitions.
- Expansion of broadband, digitalisation of public administration and research.
- Better conditions to meet the demographic challenge and ensure the integrity of the financial system.
- Investments for growth and housing construction.
Of the costs in the Swedish plan, 40 per cent can be linked to the climate transition and 24 per cent to the digital transition in accordance with the criteria of the RRF Regulation.
All the measures included in Sweden’s recovery plan are measures that the Government has proposed in the central government budget for 2020 or 2021 (including the additional amending budgets prepared on account of the pandemic). These measures are fully in line with the requirements presented in the RRF regarding matters such as growth and employment, strengthening social and regional cohesion, and supporting climate transition and digital transition.
The reforms and investments addressed within the framework of the recovery plan represent only a limited part of the very extensive measures that the Government has taken to manage the impact of the pandemic. To date, these amount to SEK 250 billion in 2020 and 2021.
All measures included in Sweden’s recovery plan are listed in a table on page 4 of the plan (see shortcuts to the right of the page).
On 23 September 2021, the Government decided on some amendments to the plan.
How much money can Sweden receive?
The preliminary assessment is that Sweden can receive some SEK 34 billion in grants through the RFF. The measures in Sweden’s recovery plan amount to a total of SEK 34 billion. Sweden is not applying for any loans.
The final amount that Sweden can receive in grants will be determined by 30 June 2022 and depend on how the crisis has affected economic development in Sweden and other EU countries. The disbursement of funds from the RRF is linked to the actual implementation of reforms and investments based on pre-defined milestones and targets, which must have taken place before the end of August 2026.
What is the state-of-play with Sweden’s recovery plan ?
The European Commission is currently assessing Sweden’s plan. Sweden and the Commission in May mutually agreed to extend the assessment period until the end of September 2021. The Commission will then present an implementing decision to the Council, which should adopt the implementing decision within four weeks. Yearly follow-ups then follow until 2026, in which the Commission reviews whether milestones and targets have been achieved and decides on payments.
What must be included in the national recovery plans and what measures can countries receive support for?
The overall goal of the recovery package is to repair the acute economic and social damages due to the pandemic. But it is also to help build an EU that is more environmentally friendly, digital, resilient and better adapted to current and future challenges. To ensure that the money paid through the facility is used in a way that is consistent with the purpose, a number of requirements are placed on the measures for which Member States apply for financial support. One requirement is that at least 37 per cent of the costs must go to climate transition and at least a further 20 per cent to digital transition or challenges connected to it. In their recovery plans, Member States must also address country-specific recommendations given within the framework of the European Semester.
Why has the Government amended the recovery plan?
The plan adopted by the Government on 27 May 2021 and subsequently submitted to the European Commission contains measures that are not going to be implemented. The plan is therefore revised. The measures Free rent setting for new production and Location and quality in rent setting are now removed from the plan. At the same time, a few minor amendments, mainly technical, are being made as a result of the Commissions’ assessment and dialogue.