Filenews 2 July 2023 - by Eleftheria Paizanou
Fifty changes to the Recovery Plan were sent by the Ministry of Finance to the European Commission, as part of an amendment to the Plan.
The revisions were made due to a €90 million reduction in the amount that the country will receive from the Recovery Fund due to the improvement of economic indicators. The funds will be replaced with additional resources to Member States through RePower EU.
An additional €104 million will be allocated to Cyprus. in the form of sponsorship, to adjust the National Recovery Plan to include additional actions for energy projects or to revise existing measures.
Out of a total of €104 million, €52 million. concern a new additional grant for Cyprus, through the RePower EU tool and the remaining €52 million. will be used by transfer from the Brexit Adjustment Reserve.
It is expected that in the coming weeks the Commission will approve the revisions of the Plan. A few days ago, the 4th meeting of the Technocratic Committee of Representatives of the parliamentary parties on the Recovery and Resilience Plan took place.
The representatives of the parliamentary parties were briefed by the Coordinating Authority on the Plan, in the presence of involved ministry officials, on the progress of the implementation of the Plan.
During the presentation of the Coordinating Authority, special reference was made to the milestones of the Plan concerning legislative regulations and the time frame during which it is estimated that the relevant bills are expected to be put before Parliament for examination and voting.
At the same time, the measures included in the amendment of the Plan, which has been promoted in recent months, in coordination with the European Commission, were presented.
It was noted that the amendment of the Plan covers the inclusion of a new chapter with actions to achieve the objectives of the REPowerEU plan, the modification of existing measures of the Plan due to objective circumstances that make their implementation unachievable, as well as amendments due to the update of the maximum financial allocation from the Recovery and Resilience Facility to Member States.
The changes
According to F's information, among other things, the changes to the Cypriot recovery plan are related to the removal of some projects, reduction of targets and postponement of timetables.
Specifically, the proposals for the amendment of the Recovery Plan included a proposal for the removal of some projects, such as the plant in Orounda for waste management and that of the Technical School of Larnaka.
It also includes proposals for postponing the timetables for the implementation of the objectives, changing the wording in the description of the measures, as well as reducing the targets.
It should be noted that 7 measures have been removed from the initial plan, totalling €60.5 million, while part of another four measures, amounting to €28.2 million, has been removed.
New upgraded measures
Moreover, the contribution of the measures of the Plan to the RePower EU capital objectives will be to enhance the energy efficiency of buildings and transport – to accelerate the penetration of RES.
In detail, reforms related to RePower EU include the implementation of a digital One Stop Shop to facilitate the licensing of RES projects and the energy upgrade of buildings.
In addition, two other reforms related to the introduction of a new regulatory framework for the operation of energy communities were included, as well as the introduction of a framework for connecting electronic vehicle charging points to the distribution system.
At the same time, two new measures were added to the category of projects related to the implementation of a subsidy scheme for the extensive energy upgrade of homes, as well as the implementation of thematic research in businesses for solutions related to energy production, storage and distribution.
At the same time, other measures related to the encouragement of the use of RES and the implementation of the use of savings measures in homes were upgraded, including special support for vulnerable energy consumers to tackle energy poverty.
The measure to encourage the use of RES by local authorities and bodies of the wider public sector as well as the one related to the energy upgrade plan of large enterprises was also upgraded.
In addition, the plan for the purchase of an electric vehicle and the financial programme for research and innovation for the green transition will be upgraded.
Legislation to be adopted
As is known, through the Recovery Plan Cyprus will receive around €1.2 billion. by 2026, after implementing 271 milestones (conditions). According to the prior actions, 58 reforms and 75 investments must be promoted.
Many of the reforms that the country needs to implement need legislation.
Specifically, 27 legislative regulations will have to be passed by the end of the Plan, of which only nine have been achieved so far.
Today, two relevant bills are under the microscope of Parliament, while legislative proposals for other reforms are under preparation.
So far, the bill for the independence of the Transmission System Operator from EAC, as well as the bills for the reform of the Public Service, have passed the Parliament's stumbling block.
Government proposals to improve the institutional framework to combat corruption, introduce a legal framework for whistleblowers and draft laws to tackle bad loans were also approved.
The bills for the development of an electronic platform to improve trade and symmetry of information in the supply chain of fresh products between derivatives-traders-buyers, the establishment of the Independent Authority against Corruption, the strengthening of the National Regulatory Authority and OCECPR, the proposals related to the implementation of an aggressive tax planning and the reform of the Local Authority have also been passed. Self-government.
It is noted that the majority of the measures that have been legislated are related to the prerequisites of the first tranche, amounting to €85 million, that the country has disbursed. Also, some of them concern the milestones of the next instalments.
In the meantime, Parliament will immediately have to approve the bills related to the 2nd and 3rd tranches, amounting to €200 million. The Republic will submit both payment requests together.
The government proposals to be voted on for these tranches concern the facilitation of strategic investments (the so-called investment law), as well as the bill to create a mechanism to safeguard the interests of real estate buyers and protect them against the seller's obligations to banks, with the aim of putting an end to the creation of new trapped property buyers.
The Ministry of Finance, in a recent letter it had forwarded to Parliament, requested that the discussion of the bill defining specific measures for the reduction of air pollutants and greenhouse gases from road transport, the bill establishing a tax exemption for corporate investors, as well as the proposals on urban land consolidation and teleworking be expedited .
Green taxation and corporation law
At the same time, the Ministry of Finance is in an open line of communication with the EU in relation to the legislative regulations concerning amendments to the Plan.
Among the regulations under discussion that mainly concern changes to timetables are the introduction of green taxation and the modernisation of the Companies Act.
Finally, by the end of 2026, bills on holistic aggressive tax planning, the regulatory framework for the development of effective electric vehicle recharging infrastructure and regulation of the relevant market, the new teacher evaluation system, the strategy to address the inadequacies of the title deed system should also be approved by Parliament, the framework for crisis management in banking institutions and the reform of the social security system.
