PM praises extra millions for Finland as EU leaders strike budget deal

After a long weekend of negotiations, European Union countries have reached a deal on a coronavirus recovery fund and a multi-year budget - but there's winners and losers.

Prime Minister Sanna Marin at EU Council meeting Brussels, 21st July 2020 / Credit: EUCO

Finnish Prime Minister Sanna Marin (SDP) says Finland will get €500 million more funding from the EU after leaders struck a deal in Brussels on a coronavirus recovery package and multi-year budget; but linking funding with good governance, one of Finland’s high priority agenda items, has largely been ignored by the EU for the time being.

Talks stretched into their fifth day early on Tuesday morning as various factions inside the EU slowly compromised on their negotiating positions for an initial proposal of €750 billion recovery fund made up of grants and loans.

The new deal struck at 05:00 will now mean the Covid-19 recovery budget has €390 billion in grants to distribute (down from a proposed €500 billion); and €360 billion in loans available (up from €250 billion).

Finland wanted to see a smaller overall package, with less money given as grants, and joined with the so-called ‘Frugal Four’ of Sweden, Denmark, Austria and Netherlands to try and achieve this, against France and Germany, and southern European countries hit hardest by coronavirus. As a negotiating strategy it was partially successful with both sides giving ground, and neither getting completely what they wanted.

Finland had also made budget conditionality a key factor in its position, meaning that countries which didn’t maintain good rule of law, independent judiciary, or guarantee human rights would have their funding cut. Here there’s been a clear failure to act, with the EU simply deciding to put conditionality on the shelf for now, and discuss it at a future date.

The extended weekend negotiations in Brussels were at times acrimonious with personal insults being thrown around by some leaders.

Prime Minister Sanna Marin at EU Council meeting Brussels, 21st July 2020 / Credit: EUCO

So what does Finland get out of this deal?

Prime Minister Sanna Marin says the new deal “contains many things that are important to Finland. The end result can be considered good from Finland’s point of view.”

She cites the significant reduction in grant money “in line with our targets”; the PM also notes that a third of the funding has to be spent on climate action, plus an increase “by almost a quarter from current levels” for research funding.

“This is a sustainable way forward” Marin says.

There is also €400 million extra in funding for Finland in the multi-year EU budget, plus another €100 million specifically for sparsely populated areas of the north and east. Finland however remains a net contributor to EU budgets – giving €16.7 billion over the next seven years, but only getting back €11.1 billion.

From the opposition parties, the National Coalition Party’s Petteri Orpo says the budget as a whole, and the coronavirus recovery fund is “disappointing.”

“Although more money is being spent, Finland’s share seems to be thin” he writes.

“The mechanism for monitoring the rule of law seems watered down. Visegrad countries [Poland, Hungary, Slovakia, Czech Republic] glow with the end result” says Orpo.

“There is a big contradiction here, and it is not good for Finland.”