This is how Germany is gorging on business aid with the green light from Brussels
While Gualtieri toyed with the refreshment decrees, Germany (and beyond) immediately started with the new type of aid. The in-depth study by Giuseppe Liturri
Blitzkrieg (lightning war) is a German word that went down in history for the war events of the Second World War. It describes a military tactic in which the power and speed of the means used to achieve the goal are combined perfectly.
Today, these are the distinctive features that are allowing Germany a powerful and timely response to the damage caused to the economy by the containment measures decided to mitigate the Covid epidemic.
The action of the Germans on this front was swift. And the aid approved a few days ago is proof of this.
On 13 October, the Commission approved the fourth amendment to the Temporary Framework on State Aid, authorizing Member States to grant non-repayable grants to companies based on fixed costs not covered by revenues?
On 17 November a notification was sent from Berlin for subsidies amounting to 30 billion and on 20 November the Commission authorized. on 28 January, the Commission approved the fifth amendment to the Temporary Framework?
On February 2, at the speed of light, Germany notified the extension of all those benefits to existing aid (extension until 31/12/2021, increase in the ceiling from € 800,000 to € 1,600,000, compensation of costs fixed loans up to € 10 million per company, possibility of converting loans into subsidies).
On 12 February, the Commission cleared the entire package, publishing it on 23.
In the interval, in order not to get bored, on January 8 the Germans notified another regulation that provides subsidies for a further 12 billion, in addition to the November 30, precisely to compensate the companies forced to close between November and December.
On January 21, the DG Competition, led by the Danish Margrethe Vestager, authorized all without batting an eye. With the addition that the latter measure was granted using the reason for the exceptional event and therefore not subject to the limits of the Temporary Framework.
German companies forced to close will be able to receive 75% of the turnover achieved in the last two months of 2019 or the entire loss of profit encountered in 2020 compared to 2019.
Close me? You pay me. Now, not in 6 months.
Do you remember the "firepower" announced by Giuseppe Conte at the beginning of April 2020? Well, in Germany they actually saw it.
What happened in Italy and, above all, what will happen? Our reaction was similar to the shot of a sloth.
On December 18, a law ordered a contribution relief for a paltry 64 million? We notified it on February 13th and received approval on February 23rd. The tax relief for Southern companies under the budget law was notified on February 13th and authorized on February 18th. Biblical times.
By the end of this week, a decree law will probably see the light of day that should use the 32 billion net debt authorized by Parliament in mid-January and awaiting, due to the government crisis, a regulation that would provide for its use. And already it seems that the blanket is starting to be short.
If you wanted to safely cover the layoffs and pay non-symbolic indemnities – we prefer to hand over the word "refreshments" to the past because here it is a compensation for damage suffered and for the sacrifice of a right – the requirement could be higher.
Now it will be up to Minister Daniele Franco to best spend a sum that will bring the deficit / GDP forecast for 2021 to around 9%, from the 7% envisaged with the latest budget law. It seems that between Palazzo Chigi and via XX Settembre a feverish work is underway by technicians to design tailor-made aid suits for companies that have suffered the second stoppage of activity in a few months starting from the end of October.
When the dossier was in the hands of the previous minister Roberto Gualtieri, the tissue papers filtered by the Mef spoke of calculation difficulties which it is hard to believe.
In fact, we must remember that we are the only large economy in the EU to use electronic invoicing.
At Mef they know in real time who, what and how much they invoice. What is presented as a very difficult birth by the Treasury technicians, is an aid authorized by the Commission since October and allows the respective national governments to disburse, always subject to Vestager's authorization, subsidies varying from 75% to 90% of fixed costs not covered by revenues (substantially from the loss of the income statement) for companies that have suffered a decrease in turnover of more than 30% in a period chosen between 1st March 2020 and 31st December 2021.
While Gualtieri was amusing himself with insignificant "refreshment" decrees, Holland, Germany, Poland, Slovenia, Austria, Denmark, Sweden immediately started with the new type of aid allowed by the Commission or by strengthening other types of aid already authorized.
The Treasury technicians can refer to the Commission Decision SA.59289 adopted for Germany on 20 November last. The subsidies are disbursed to companies on the basis of a provisional interim balance sheet sworn by an accountant and then in the final balance there is a possible adjustment.
The first real change of pace in the government of President Mario Draghi will be measured by the incisiveness and speed of these measures. The country can no longer wait.
(article published in the newspaper La Verità)
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/germania-aiuti-coronavirus/ on Sat, 27 Feb 2021 19:25:17 +0000.