State aid: 2022 Scoreboard shows that in 2021 State aid levels remained high to tackle economic effects of the pandemic

The annual State Aid Scoreboard provides a comprehensive overview of EU State aid expenditure based on the reports provided by the Member States. Today, the European Commission publishes the 2022 State Aid Scoreboard, relates to State aid expenditure in 2021. The 2022 edition shows the important contribution of State Aid policy in enabling Member States to continue to support companies in the difficult economic context brought about by the coronavirus pandemic, while preserving the level-playing-field in the Single Market.

In 2021, Member States spent approximately €335 billion under State aid measures for all objectives, excluding aid to railways and Services of General Economic Interest (‘SGEI'). Results show that about 57% of this support (i.e. around €191 billion) helped businesses seriously affected by the coronavirus pandemic to remain viable.

The 2022 State Aid Scoreboard shows in particular, that, for 2021 aid expenditure:

• Member States spent €334.54 billion, about 2.3% of their combined 2021 GDP, on State aid for all objectives, excluding aid to railways and SGEI'.  The total expenditure for measures relating to the economic effects of the coronavirus pandemic reached €190.65 billion (about 57% of the total State aid spending), while public support for other measures not related to the coronavirus pandemic was €143.89 billion (about 43% of the total spending).
• Compared to 2020, in 2021 State aid expenditure by Member States decreased by -1.9% after adjusting for inflation (i.e. €6.17 billion). More specifically, the expenditure related to the COVID-19 crisis increased by 4.7% in constant prices (i.e. €8.6 billion) and support for other measures decreased by 1.7% (€2.43 billion).
• For what concerns State aid expenditure in the context of the coronavirus pandemic, Malta and Greece are the Member States with the largest share of COVID-19 related State aid expenditure relative to their 2021 national GDP (2.48% and 2.46% respectively), followed by Austria (2.1%), Slovenia (2%), Latvia and Slovakia (both around 1.9% of their GDP), and by Germany (1.8%). Sweden (0.21%) and Belgium (0.22%) are the Member States that spent least in relative terms, followed by Estonia and Ireland (0.4% each).  
• For what concerns State aid expenditure for non-coronavirus crisis objectives:

• • EU 27 Member States spent €143.89 billion on State aid for other measures not related to the coronavirus pandemic, corresponding to 0.99% of EU27 2021 GDP and 43% of the total spending. This constitutes a decrease compared to 2020 figures, while the average annual change recorded in the period 2015 – 2020 had always remained positive. This seems to indicate that in 2021, with the continuation of the COVID-19 crisis and the consequent need to prolong the granting of aid measures in the context of the coronavirus pandemic, Member States have slightly reduced their spending capacity for non-crisis objectives.
  • In line with previous years, also in 2021 environmental protection and energy savings are the (non-crisis-related) policy objectives on which Member States by far spent the most (€69 billion). Research and development, including innovation, has become the second objective on which Member States have spent the most (€18.77 billion, an increase of €6.48 billion compared to 2020), followed by regional development (€14.21 billion).
  • In a continuing trend,  Member States are increasingly using the General Block Exemption Regulation (‘GBER'), which provides scope for certain measures with limited impact on the internal market to be implemented without prior approval by the Commission, as well as other sectoral block exemptions (i.e. Agricultural Block Exemption Regulation (‘ABER') and Fishery Block Exemption Regulation (‘FIBER')). In 2021, Member States implemented 2,365 new GBER, 296 new ABER and 29 new FIBER measures, corresponding altogether to 83% of all new State aid measures. Excluding the measures related to the COVID-19 crisis, ABER and FIBER, the new GBER measures account for 93% of total new non-crisis measures. Furthermore, the expenditure under GBER measures increased in 2021 with respect to the previous year (+10%, €5.8 billion in real terms), thus showing a higher increase than the one realised in the two years before (+6% in 2020 and +8% in 2019), in contrast to the general reduced spending capacity for non-crisis objectives.

Background

The COVID State aid Temporary Framework was adopted on 19 March 2020 to enable Member States to use the full flexibility foreseen under State aid rules to support the economy in the context of the coronavirus outbreak. The COVID Temporary Framework has been amended on 3 April, 8 May, 29 June, 13 October 2020, 28 January and 18 November 2021. As announced in May 2022, the COVID Temporary Framework has not been extended beyond the set expiry date of 30 June 2022, with some exceptions.

The COVID Temporary Framework complemented the ample possibilities available to Member States, such as measures providing compensation to companies for damages directly suffered due to exceptional circumstances or measures helping companies cope with liquidity shortages and needing urgent rescue aid.

Furthermore, on 23 March 2022, the Commission adopted a State aid Temporary Crisis Framework to enable Member States to use the flexibility foreseen under State aid rules to support the economy in the context of Russia's invasion of Ukraine. The Temporary Crisis Framework has been amended on 20 July and 28 October 2022 to complement the Winter Preparedness Package and in line with the REPoweEU Plan, as well as with the Regulation on an emergency intervention to address high energy prices (‘Regulation (EU) 2022/1854') and the Commission's proposal on a new emergency regulation to address high gas prices in the EU and ensure security of supply this winter.

On 9 March 2023, the Commission adopted a new Temporary Crisis and Transition Framework to foster support measures in sectors which are key for the transition to a net-zero economy, in line with the Green Deal Industrial Plan. The new Framework amends and prolongs in part the Temporary Crisis Framework, adopted on 23 March 2022 to enable Member States to use the flexibility foreseen under State aid rules to support the economy in the context of Russia's war against Ukraine. Together with the amendment to the General Block Exemption Regulation (‘GBER') that the Commission endorsed on the same day, the Temporary Crisis and Transition Framework helps speeding up investment and financing for clean tech production in Europe. It also assists Member States in delivering on specific projects under National Recovery Plans which fall within their scope.

Finally, since May 2012, the Commission has implemented an ambitious State aid reform programme (‘State Aid Modernisation') with three closely linked objectives: (i) foster growth in a strengthened, dynamic and competitive internal market; (ii) focus enforcement on cases with the biggest impact on the internal market; and (iii) streamlined rules and faster decisions.

The State Aid Modernisation exercise has allowed Member States to quickly implement State aid that fosters investment, economic growth and job creation, leaving the Commission to focus its State aid control on cases most liable to distort competition.

On 7 January 2019 the Commission launched, in line with the Commission's Better Regulation Guidelines, the evaluation of the rules, which were adopted as part of the State aid Modernisation exercise, including the Guidelines on State aid for environmental protection and energy and the Communication on important projects of common European interest (IPCEI) among others. The evaluation took the form of a “fitness check”. The aim was to provide a basis for decisions about whether to further prolong or possibly update the existing rules. 

The results of the evaluation exercise are summarised in a Commission Staff Working Document. The milestones of the Fitness Check are listed on the Better Regulation Portal. All relevant State aid rules, including the already amended ones, can be found here.