Policy brief

How good is the European Commission’s Just Transition Fund proposal?

On 14 January 2020, the European Commission published its proposal for a Just Transition Mechanism, intended to provide support to territories facing

Publishing date
26 February 2020

This Policy Contribution was prepared for the European Parliament’s Committee on Regional Development (REGI) as an input to a REGI workshop on the Just Transition Fund on 19 February 2020. The original paper is available on the European Parliament’s webpage (here). Copyright remains with the European Parliament at all times.

  • The JTF is supposed to rely on €7.5 billion of ‘fresh money’ from the EU budget, to be complemented by funds from member states’ European Social Fund Plus (ESF+) and European Regional Development Fund (ERDF) envelopes, and by co-financing at the national level. All member states are eligible for the JTF, following the approval of their Territorial Just Transition Plans by the Commission. Funds are pre-allocated on a national level. Projects eligible for financing currently include projects aimed at economic revitalisation, social support and land restoration.
  • Given its small size, the JTF will not realistically be able to tackle effectively all three priorities. That is why we believe that it should fundamentally be amended to maximise its impact: funds should be allocated on a project basis (similar to the European Globalisation Adjustment Fund) rather than sprinkled all across Europe on a geographical basis.
  • To be sure that the JTF fulfils its objective on mitigating the social and economic costs of the transition to a climate-neutral economy, we also recommend the following amendments to the regulation:
    − Restrict eligible activities to social support and, to a lesser extent, land restoration;
    − Under social support, upskilling and reskilling policies should be combined with efforts to collect, harmonise and disseminate regional labour data; pension-bridging grants and mobility grants could also be added to the list of eligible activities;
    − Eligibility for land restoration support should be restricted to sites where a company is no longer able to pay for restoration itself, to respect the polluter-pays principle;
    − Use NUTS3-level data in the allocation formula rather than NUTS2-level data, to ensure that all territories in need of help are counted in the JTF allocation fomula;
    − Remove the mandatory transfer of ERDF funds into the JTF envelope and instead require member states to devote a portion of ERDF funds to the economic revitalisation of regions affected by the transition and identified by JTF allocation criteria, as a complement to the social support provided by the JTF.

About the authors

  • Grégory Claeys

    Grégory Claeys, a French and Spanish citizen, joined Bruegel as a research fellow in February 2014, before being appointed senior fellow in April 2020.

    Grégory’s research interests include international macroeconomics and finance, central banking and European governance. From 2006 to 2009 Grégory worked as a macroeconomist in the Economic Research Department of the French bank Crédit Agricole. Prior to joining Bruegel he also conducted research in several capacities, including as a visiting researcher in the Financial Research Department of the Central Bank of Chile in Santiago, and in the Economic Department of the French Embassy in Chicago. Grégory is also an Associate Professor at the Conservatoire National des Arts et Métiers in Paris where he is teaching macroeconomics in the Master of Finance. He previously taught undergraduate macroeconomics at Sciences Po in Paris.

    He holds a PhD in Economics from the European University Institute (Florence), an MSc in economics from Paris X University and an MSc in management from HEC (Paris).

    Grégory is fluent in English, French and Spanish.

     

  • Simone Tagliapietra

    Simone Tagliapietra is a Senior fellow at Bruegel. He is also Adjunct professor of Energy, Climate and Environmental Policy at the Università Cattolica del Sacro Cuore and at The Johns Hopkins University - School of Advanced International Studies (SAIS) Europe.

    His research focuses on the European Union climate and energy policy and on the political economy of global decarbonisation. With a record of numerous policy and scientific publications, he is the author of Global Energy Fundamentals (Cambridge University Press, 2020), L’Energia del Mondo (Il Mulino, 2020) and Energy Relations in the Euro-Mediterranean (Palgrave, 2017).

    His columns and policy work are published and cited in leading international media such as the Financial Times, The New York Times, The Guardian, The Wall Street Journal, Le Monde, Die Zeit, Corriere della Sera, Il Sole 24 Ore and others.

    Simone holds a PhD in Institutions and Policies from Università Cattolica del Sacro Cuore. Born in the Dolomites in 1988, he speaks Italian, English and French.

  • Catarina Midões

    Catarina Midões works at Bruegel as a Research Analyst, where her research is centred on Better Regulation in EU law-making, Competition Policy and Cohesion Policy. Catarina holds an MSc in Econometrics and Operations Research with a Specialisation in Econometrics from Maastricht University and a BSc in Economics from Nova SBE. Her research work has been focused in inequality, ex-post impact evaluation of public policy and inference techniques.

    Before joining Bruegel, Catarina worked as an Economic Analyst at Oxera, where she focused on efficiency benchmarking in the regulated utility markets, using Stochastic Frontier Analysis and Data Envelopment Analysis, and on transport economics, in ex-ante evaluation of transport projects and estimation of public transport demand elasticities.

    Catarina also completed an internship in the European Commission’s Joint Research Center, in the Competence Centre on Microeconomic Evaluation, where she focused on implementation of Structural Reforms. Catarina also worked as a Research Assistant in Nova School of Business and Economics, as part of the research centre NOVAFRICA.

    She is fluent in Portuguese, English and Spanish and has a working knowledge of Italian.

  • Aliénor Cameron

    Aliénor worked at Bruegel as a Research Assistant Intern. She holds an Undergraduate degree in Economics and Political Science from Sciences Po Paris and is currently working towards her Master’s degree in International Economic Policy, with minors in environmental policy and quantitative methods. She is expected to graduate from Sciences Po Paris in 2021.

    Before joining Bruegel, Aliénor worked as a Research Assistant for the Centre National de la Recherche Scientifique at the Paris School of Economics. In this role, she worked on a project which studied the effects of trade openness in developing countries on local populations’ access to highly processed foods and the resulting health implications.

    Aliénor also worked for Le Cercle des Economistes as a project manager, and was in charge of writing the think tank’s annual position paper. Before that, she interned at Regulatory Economics Group, a consulting firm in the Washington D.C. area specialized in energy economics and regulation.

    Aliénor is a dual French and American citizen and is fluent in English, French and Spanish.

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