Spain asks the EU for 20 billion euros aid to finance the ERTE

2020/08/03 16:57:48 Written by Canarian Weekly Business

Spain has requested, that the European Commission, access the European instrument for the mitigation of unemployment risks, known as SURE, for an amount of more than 20 billion euros to help finance programs to support self-employed workers and companies during the pandemic, with community loans.

This program was one of the three new mechanisms launched at European level, together with the precautionary line of the European Stability Mechanism, and the guarantees of the European Investment Bank (EIB), to provide a health, economic and social response to the effects of the Covid-19 pandemic.

The SURE program, for which applications are open until this Friday and it’s expected that eighteen EU countries will request access to it, will mobilize maximum resources at the community level of 100 billion euros, and will be financed with debt issues from the European Union in the markets. Member States contribute to the instrument by providing guarantees for emissions from the EU.

On May 26th, the Council of Ministers authorized the granting of the necessary guarantees, for the participation of Spain in the European Instrument of Temporary Support, to mitigate the risks of unemployment in an emergency created by the European Commission (SURE).

In the case of Spain, this instrument allows financing programs such as the Temporary Employment Regulation Files (ERTE), both regarding the benefit received by the worker, and the social contributions that the employer saved.

The SURE resources can also be used to finance the extraordinary benefit for cessation of activity for the self-employed, as well as the temporary disability benefit for people who have been on leave as a result of the Covid-19, or support for discontinuous permanent workers, in particular of the tourist sector.

The amount requested to finance these programs is more than 20 billion euros, as indicated by the Ministry of Economic Affairs, although it points out that the final amount to be received will depend, among other factors, on the volume requested by the other interested countries in this program.

Once the final amount has been determined by the EU Council, at the proposal of the European Commission, the credit will be disbursed to the States that request this instrument in several payments. The first of them could be received in autumn 2020 and the rest from 2021.