Government set to deliver EU assistance for coal-dependent areas
EU Aid for Post-Coal Regions Altered, Sparks Controversy
Berlin - The European Union's billion-euro aid allocated for structural changes following the coal phase-out will not be extended to the affected regions in North Rhine-Westphalia and Eastern Germany, as the German government plans to utilize these funds to fulfill earlier funding commitments, diminishing the federal budget, according to a response from the German government to a query by the Bundestag's Greens, as reported by the Funke media group's newspapers (Friday editions).
The German government's initiative to channel EU funds towards fulfilling the obligations outlined in the Coal Structural Strengthening Act is necessary from a budgetary standpoint, given fiscal constitutional constraints on debt, the government stated in its response. The Greens have condemned this decision as a "political breach of trust," asserting the distribution procedure resembles a "feudal lord's,” disregarding dialogue with the states, parliaments, and the public, according to Funke newspapers.
The Saxon Minister for Europe, Katja Meier (Greens), called this move a "completely wrong signal" if Germany, during its EU Council presidency, employs European funds to accomplish previously made national financing pledges. "To meet the Paris climate goals and promote the phase-out of brown coal, additional measures and additional funds are required," Meier added.
In Germany, the brown coal mining regions in Rhineland, Brandenburg, Saxony, and Saxony-Anhalt are slated to receive 2.25 billion euros in aid, with part of the funding sourced from the current EU budget and the remainder from the European Corona recovery fund. The EU has established an aid fund for coal regions in Germany and other states, aiming to drive structural transformation away from coal through infrastructure investments, company aid, or employee retraining.
Connectedly, the "ReArm Europe" program involves approximately 150 billion euros from European loans being allocated for defense spending, a practice raised previously as a topic of debate due to the challenges associated with using funds intended primarily for addressing socio-ecological inequalities. However, the immediate relevance of this issue, in regards to the coal phase-out context, remains unclear.
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Other industries in the affected regions might struggle without the potential influx of EU funds, given the financial void left by the Coal Structural Strengthening Act. The German government's decision to prioritize earlier funding commitments over EU aid for energy transition could hinder a balanced approach in the post-coal regions, sparking controversy within the finance, energy, and industry sectors.
