The latest European Parliament proposal on the regulation of the European Fund for Strategic Investments aims to limit the scope of the Juncker Plan to “high risk” investments. This approach may prevent it from helping to address one of the "biggest risks" facing many economies in the EU: the housing emergency.
The announcement of the setting up European Fund for Strategic Investments raised high expectations from both the public, cooperative and social housing sector and the tenants’ representatives. It was perceived as a tool which could potentially help meet key future challenges for cities and citizens. However, after the first discussions in the European Parliament, Housing Europe, the European Federation for Public, Cooperative and Social Housing, is concerned that the Fund will in fact not do this. The draft joint report of the BUDG/ECON committees contains some amendment proposals that could strongly limit the possibility to invest in social, cooperative and public housing.
Housing Europe Secretary General, Sorcha Edwards commented just before the deadline for tabling amendments to the parliamentary report:
"In its 2014 report the special taskforce mandated to ’Develop the basis for an investment project pipeline in the EU’ grasped the urgent need for investment in the housing sector. The current blocks to investment prevent many regions and cities from addressing the mismatch between supply and demand of housing which is damaging lives, breaking up families, blighting employment prospects, reducing mobility, over-burdening unnecessarily the health sector and slowing the economy. This European Parliament report creates limitations rather than providing the regulatory conditions that could boost the investment flow towards a sector in need for liquidity".
In November 2014, the Taskforce of the EU on the Investment Plan stated: "… shrinking regional and municipal budgets are having a negative impact on urban social services, including the provision of social housing in several Member State". Housing Europe shares this view and stresses again the need for financial support to affordable housing in the EU for the construction of new homes (e.g. UK), for sustainable schemes to prevent eviction (e.g. Hungary, Poland, Ireland) for the conversion of empty private properties into social housing (e.g. Italy, Spain) as well as for the refurbishment of the multifamily buildings in Central and Eastern Europe and adaptation of homes for aging population (e.g. Germany, France) The economic and societal impact of investing in the housing is now well documented.
Concretely, the European Parliament draft report contains some rather controversial articles that, if adopted, might end up derailing the Juncker Plan as an instrument to achieve growth and jobs. Housing Europe highlights:Read More
- The Fund should not be focused on finding high risk projects (as referred to in AM 40 on new article 5, page 27 of the draft report) but supporting identified solutions to one of the biggest risks threatening competitiveness and social inclusion in Europe, the Housing Emergency which is damaging lives, breaking up families, blighting employment prospects, reducing mobility and slowing the economy.
- The EU guarantee should be activated for all kind of activities of the EIB or other national public banks and complement the funding provided by the European Structural and Investments Funds (and NOT only be limited to operations that cannot be financed by Union programmes or traditional EIB activities as proposed by AM 40 in the draft report on page 27). Expanding already successful operations, such as bilateral loans from the EIB to national housing agencies, is crucial if the Investment Plan is to really deliver.
- On top of that, Housing Europe supports clear ring fencing for Energy efficiency
investment in housing in the activities of the fund in order to be in coherence with the European Commission communication on the Energy Union (AM 27 of the ITRE opinion).
Since the Council has proposed to delete any reference to social and urban infrastructures as potential investment areas in the field in contradiction with the Taskforce report and the objectives of the EU Investment Plan announced by President Juncker, the role of the European Parliament is therefore to ensure that social and urban infrastructures will be clearly referred to in the Regulation.