ECONOMY

Strict criteria for state support

strict-criteria-for-state-support

The support measures that will apply from now on will come with more conditions and criteria, as the government seeks to channel available resources to damaged professionals, corporations and households in a strictly targeted fashion.

The subsidy of enterprises’ fixed expenditure will only concern those who sustained losses during the pandemic and a considerable drop in turnover.

The right to suspend workers’ contracts is already granted only to sectors with a considerable fall in revenues, while the criteria will become even more specific so as to account for the eligibility of every company separately. Consequently, the right to furloughs – with the state undertaking the payment of suspended employees – will only be granted to companies proven to have suffered from the pandemic, and not horizontally to those in sectors considered hurt by the restrictions based on their activity code number (KAD).

Furthermore, the subsidy for the repayment of business loans via the program dubbed “Gefyra 2” (after the “Gefyra” program subsidizing mortgage tranches for the main residence of borrowers) will require that the company to benefit must not only be among those hurt by the pandemic but also be considered sustainable – this means that businesses which stopped meeting their obligations before the outbreak of the pandemic will be cut off.

There will be additional interventions aimed at ensuring that more cash reaches enterprises that remained closed for a long time due to the coronavirus (such as food service and tourism companies) through the next stage of the cheap state loans program (“Deposit To Be Returned”).

The introduction of stricter criteria and the decision to avoid resorting to horizontal handouts like those offered last year also serves vital fiscal targets, namely containing the swelling of the budget deficit, which is already projected to end up higher than in 2020. It is also a mater of social justice, as state assistance will reach those who really need it.