What results can be expected from the EU Recovery and Resilience Facility?

Publishing date
17 April 2023
Zsolt Darvas
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What results can be expected from the EU Recovery and Resilience Facility?

There are numerous examples of when EU-funded projects were implemented according to all regulations, but their use fell short of expectations. Those include roads, airports and trains which were hardly used. Planning failures, misallocations and yielding to specific interest groups could explain such fiascos.

Over the past fifteen years, there has been an increased focus on measurable results in the EU budget to limit such adverse projects. In the jargon, the financing method which is not based on the actual costs of a project, but on the achievements reached, is called ‘performance-based funding’.

The EU Recovery and Resilience Facility (RRF) is performance-based, but only in name. The RRF Regulation does not require the achievement of results in the commonly understood sense, but instead “measures of progress towards the achievement of a reform or an investment". The European Commission guidelines for preparing recovery plans by EU national authorities, to access RRF funding, explicitly discouraged result indicators.

Perhaps for this reason, there are major differences in the use of result indicators in national recovery plans.

For example, France, Germany and the Netherlands adopted very few result indicators but instead focused on input indicators (e.g., how much money is spent) and output indicators (e.g., whether a road is built). In contrast, the Finnish, Italian and Romanian plans included quite some result indicators and few input indicators.

For any future performance-based EU instrument, results indicators must be given a prominent role. It would also be important to compare the levels of ambition and expected achievements of different countries, which, unfortunately, has not been done for the RRF.

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About the authors

  • Zsolt Darvas

    Zsolt Darvas is a Senior Fellow at Bruegel and part-time Senior Research Fellow at the Corvinus University of Budapest. He joined Bruegel in 2008 as a Visiting Fellow, and became a Research Fellow in 2009 and a Senior Fellow in 2013.

    From 2005 to 2008, he was the Research Advisor of the Argenta Financial Research Group in Budapest. Before that, he worked at the research unit of the Central Bank of Hungary (1994-2005) where he served as Deputy Head.

    Zsolt holds a Ph.D. in Economics from Corvinus University of Budapest where he teaches courses in Econometrics but also at other institutions since 1994. His research interests include macroeconomics, international economics, central banking and time series analysis.

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