09 Apr 2020

Protecting employment in the time of coronavirus

What is the EU’s €100 billion going to buy?

Miroslav Beblavy

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This paper briefly analyses the proposal by the European Commission to establish SURE, the ‘European instrument for temporary support to mitigate unemployment risks in an emergency’.

The SURE facility would borrow up to €100 billion on the financial markets, lend it to member states to finance short-time work schemes and similar measures, using guarantees from the member states themselves.

The analysis makes the point that the scheme should be seen, first and foremost, as a proof of European solidarity to counter hostile propaganda from Russia and China about the EU’s ineffectiveness. It can also have an impact on national policies to deal with the coronavirus and to assist the most damaged and/or fiscally weak member states, but this effect is likely to be limited. Potentially, the most important feature of SURE is that it explicitly refers to itself as the forerunner of a future European Unemployment Insurance scheme.