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Almost every local government across the EU expects a sharp decrease in revenues this year due to the COVID-19 pandemic. Expenditure on health, social services and civil protection has boomed, while income from tourism and the economy is decreasing.
The COVID-19 crisis will lead to a sharp contraction of GDP in all EU member states. From billions for airlines to several hundred euros for small businesses, governments have been supporting their economy in different ways.
For weeks, Spain and Italy were epicentres of the COVID-19 pandemic. Their health defences had an important gap: large staffing shortages and low ratios of nurses to doctors. At the same time, nurses had higher infection rates than the general population, mainly because of the lack of personal protective equipment.
Calls have been coming from all sides for the EU to intervene in the COVID-19 crisis in the name of European solidarity. Although the Union has little room for manoeuvre in the public-health sphere, it can use the powerful lever of economic and monetary policy to counter the coming economic downturn.
“Hypertrophic”, “poorly run”, “bloated”, “too costly”... in all countries, cliches concerning the public service are legion. New indicators allow us to see how the reality is more nuanced.
Only 30 km of the whole rail network in Greece has functioning train traffic lights. The installation of new European Train Control System has derailed in the country because of mismanagement – costing tens of millions of public funds and several fatalities.
In Western Europe and Scandinavia, people spend more on healthcare and live longer, while in Central and Eastern Europe and the Baltic States, less money is spent and life expectancy at birth is lower too. The EU average for healthcare spending is 9.9 percent of GDP. In Hungary it is 7.4 percent.
The international outlook for this autumn does not seem rosy. Will Europe be able to act in response to the warning signs? That will largely depend on the German government’s willingness to (finally) let go of the dogmas imposed on the eurozone for the last decade.
A large part of the EU's budget is devoted to supporting agriculture. Yet farmers receive a given amount per hectare – so large farms receive way more money than the small ones, to the extent that 25 percent of all EU farmers receive only 1.3 percent of the available funds.
It’s back to the drawing board for Italy and its draft budget. And according to Rome, this is not even the most serious case in the EU. So, what is the state of affairs in other countries?