Portugal Has Drawn 24 Percent of Its 22.6 Billion Euro EU Envelope, More Than Four Points Below the European Average and Seventh From the Bottom

The European Commission's country-by-country monitor of cohesion policy payments was updated on Thursday, and it puts Portugal seventh from the bottom of the European Union on execution of the 2021 to 2027 financial framework. That is an improvement on where the country sat in May, when it was last.

Portugal has received 5.43 billion euros. Of that, 1.62 billion arrived as pre-financing, which is 7.2 percent of the national envelope, and 3.8 billion as interim payments, 16.8 percent. Interim payments are the ones that follow beneficiaries actually submitting invoices, so they are the closer measure of money reaching projects. The combined total is 24 percent of the 22.6 billion euros Portugal has to invest by 2027, with two further years allowed for spending.

The Ranking Depends on Who You Stand Next To

Estonia leads the table on 50.9 percent and Finland follows on 48.9 percent, but both are working with much smaller envelopes: 3.36 billion and 1.94 billion euros respectively. Third place goes to Luxembourg, which has been paid 18.44 million euros, or 47.4 percent of a total envelope of 38.92 million.

Those comparisons are close to meaningless at the extremes, and the Portuguese government's usual response is to compare only with the 15 member states whose envelopes exceed six billion euros. On that narrower basis Portugal is ninth for interim payments, and still seventh from the bottom overall. The European average is 28.4 percent, so Portugal sits more than four points below it. At the end of July the country was ninth in the same 15-country comparison, with Portugal 2030 showing an execution rate of 20.8 percent.

Why the Money Is Slow

Under the previous framework, Portugal 2020, the country was at one point near the top of the same table. Two things pushed Portugal 2030 to the back. It entered into force even later than these programmes usually do, and it ran at the same time as both the closing of Portugal 2020 and the execution of the Recovery and Resilience Plan, whose 22.2 billion euro allocation, later revised down to 21.9 billion, was effectively the size of a second framework and carried a hard deadline of 31 August this year. We covered that deadline and what execution stood at when it arrived.

The same collision explains why the biggest countries look worst. Spain is last, with 4.36 billion euros of interim payments, or 12.3 percent, and Italy is one step above it on 5.62 billion and 13.3 percent. Those two have the largest recovery plans in the Union and, respectively, 35.56 billion and 42.17 billion euros of cohesion money still to spend by 2029. Romania, by contrast, has drawn 36.5 percent of a 30.98 billion euro envelope and Poland 29.6 percent of 75.46 billion. Portugal holds the sixth largest envelope in the Union.

The Measures Already Taken

The government has passed a series of accelerants over the past year. Contracts for projects financed or co-financed by European funds no longer require prior approval from the Court of Auditors. The suspensive effect of interim injunctions can be lifted. Municipalities can issue a declaration of responsibility to speed public housing investment. Mandatory project review has been waived in some cases, information systems improved, universities and polytechnics brought in to help assess applications, decision deadlines shortened and staff added.

What the July to September movement shows is that these are beginning to register in the payment data, but from a low base and against a clock. Money not claimed by the end of the eligibility period returns to Brussels, and Portugal has until 2029 to claim it.