The EC ultimately gave a positive opinion on the Polish KPO. The total funds negotiated by Poland amount to EUR 57 billion

Yesterday, at the meeting of the College of Commissioners, the Polish National Reconstruction Plan (KPO) received a positive opinion, after previous negotiations had been conducted by a team appointed by the President of the European Commission, Ursula von der Leyen, and by representatives of the Polish government headed by Minister Waldemar Buda.

READ MORE: An official decision has already been made! The European Commission has approved Poland’s National Reconstruction Plan

National Reconstruction Plan

The negotiations did not concern the content of the Polish KPO, these issues were finally decided in the summer of the previous year, but the reform of the judiciary in Poland, in particular the Supreme Court Disciplinary Chamber, amended procedures for disciplinary proceedings, and finally, the possibility to resume proceedings of judges already punished for the new chamber in SN – Chamber of Professional Responsibility. The agreement that was reached is based on the presidential bill on the Supreme Court, which contains provisions governing all these issues, which has already been passed by the Sejm and has been sent back for consideration in the Senate. Yesterday’s decision by the College of Commissioners with a positive verdict on the Polish KPO strongly contradicts the claims of opposition politicians in our country that changes to the parliamentary submission are needed, because it does not meet the expectations of the European Commission .

Now, with a positive opinion from the European Commission, the Polish FPA will be discussed by the Council of the European Union (in this case the finance ministers of 27 Member States) in mid-June and once adopted it will be possible to implement the projects contained therein. Due to the fact that advances from KPO in the amount of 13 percent. of the amount included in the KPO were only paid to countries whose plans were approved on December 31, 2021, now the first tranche of funds can be requested after the end of the first half of this year (settlements under the KPO are provided for in the semi-annual system). The government is likely to submit such a request in early July, and given that the European Commission has several weeks to verify it, and August is traditionally a holiday month in European institutions, the first payments under the Polish KPO can be expected in September.

Let’s not forget that the total resources that Poland negotiated in the FPA is EUR 57 billion, of which: almost EUR 24 billion are grants (grants), while about EUR 33 billion are financially attractive loans. At the same time, under the KPO, the Polish government has so far applied for the entire grant and only EUR 11.5 billion of the loan portion, thus a total of EUR 35.5 billion, mainly from local authorities, which main beneficiaries of the funds with KPO, there was no interest in loan instruments. This is strange behavior of local authorities, especially large cities, who have to make large and expensive investments, especially in the field of environmental protection, and at the same time show no interest in financial resources, although of loan, but on very favorable terms.

Where does the KPO money go?

Let us also recall that the funds under the FPA will be spent in the years 2022-2026 (although as much as 70% of the funds should be programmed by the end of 2022), and the measurable results of their spending will include ; GDP per capita growth from the current 73% to 95 percent in 2030 (taking into account the purchasing power of the currency, EU-27 average = 100), an increase in the investment rate from the current 17% to 25 percent in 2030, and an increase in the employment rate from the current 68%. to 77 percent in 2030 (persons aged 15 to 64). In the version sent to Brussels, as I said, the amount of EUR 35.5 billion was allocated (all grants provided to Poland and EUR 11.5 billion in loans of EUR 33 billion made available to our country) , so after conversion according to the current exchange rate, the amount of about PLN 160 billion.

These funds are allocated to 5 priority areas: green energy and energy intensity reduction – EUR 14.5 billion (PLN 65 billion); green smart mobility – EUR 7.5 billion (PLN 33 billion); digital transformation – EUR 4.9 billion (PLN 22 billion); resilience and competitiveness of the economy – EUR 4.7 billion (PLN 21 billion) and efficiency and accessibility of the health care system – EUR 4.6 billion (PLN 21 billion).

In addition, these funds are equally divided between the public sector, which includes the state funds, which accounted for 37.5 percent, and the local government sector – more than 31 percent. and the private sector also over 31 percent. resources allocated to date. These proportions could change if entities from all three sectors show an interest in the loan portion of the KPO, as there is still approximately EUR 21.5 billion to be distributed here.