The European Council announces the adoption of SURE, temporary Support to mitigate Unemployment Risks in an Emergency
On the 19th of May 2020, the European Council adopted SURE (Support to mitigate Unemployment Risks in an Emergency). The European Commission (EC) proposed this new temporary scheme, which allows for financial assistance of up to EUR 100 billion in the form of loans from the European Union to affected member states, in order to grant them some financial relief during the current coronavirus crisis.
With the COVID-19 pandemic posing an unprecedented challenge for Europe and the whole world, putting many lives and livelihoods at risk, not only in terms of public health implications, but also with regard to the massive economic and social disruption it has caused, many companies have to rely on public support to preserve employment. Thus, the Council of the European Union has adopted SURE, a support package that is part of the EU´s emergency response to the COVID-19 pandemic, thought to tackle the grave economic impact of the coronavirus crisis on the EU´s member states.
To address this challenge, the EU has put in place SURE as a temporary instrument to help workers keep their jobs during the crisis. It has been adopted by the European Council in order to provide up to €100 billion of loans under favourable terms to member states. Thus, the scheme enables member states to request EU financial support to help them with financing the sudden and severe increases of national public expenditure, as from the 1st of February 2020, related to national short-time work schemes and similar measures, including for self-employed persons, or to some health-related measures, in particular at the work place in response to the crisis.
SURE is one of three safety nets with a total worth of €540 billion, for jobs and workers, businesses and member states, which was contained in the Eurogroup report agreed on the 9th of April 2020. The report has been endorsed by EU leaders on the 23rd of April, with the package becoming operational by the 1st of June 2020. SURE will become available after all member states have provided their guarantees, and will then be operational until the 31st of December 2022. On the proposal from the Commission, the Council may decide to extend the period of availability of the SURE support package, each time for a further 6-month period, if the severe economic disturbances caused by the COVID-19 outbreak persist.
In order to provide requesting member states with financial assistance at favourable terms, the European Commission is planning on raising funds on international capital markets on behalf of the EU. SURE loans will be backed by the EU budget and guarantees provided by member states according to their share in the EU's GNI, with the total amount of guarantees being as high as €25 billion. All of the EU member states will be able to make use of the instrument, but particularly for workers in the hardest-hit economies, SURE will act as a very important safety net. Formally, the financial assistance will be granted by a decision adopted by the Council on a proposal from the Commission.
According to Zdravko Maric, Deputy Prime Minister and Minister of finance of Croatia, the SURE scheme is thought to be a vital safety net to protect jobs and workers all over Europe, as it will ensure that member states of the European Union have the necessary means to finance measures that can address unemployment and loss of income, as well as health-related measures.