Special committee on the Housing Crisis in the European Union Ordinary meeting
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HOUS European Parliament
Follow its sittingsRaffaele Fitto
Often, young people cannot afford to live where they work. We have already taken concrete steps. As you know, for the first time, there is a commissioner dedicated to housing. In December, the commission adopted the first European affordable housing plan. It targets housing supply, investment, permits, young people, and the homeless.
Housing is also central in my portfolio in cohesion policy and the RRF. In all my meetings with the members of the European Parliament, ministers, governors, mayors, housing consistency emerged as a top priority. On the recovery and the resilience facility, is the largest single EU fund directly targeting housing affordability and supply, providing 18,100,000,000 across 17 member states, benefiting 1,500,000 households. These funds support reforms to enhance access to quality affordable housing, such as streamlining permitting processes, establishing social and affordable housing programs with the dedicated financing mechanism, reforming the tax rules to correct housing market imbalances. Housing measures under the RF also target sustainability, for instance, by supporting energy efficiency renovations for disadvantaged households, by including energy efficient criteria in the construction and renovation of social housing.
We have seen numerous examples across the member states that show how the RF is making a real effort in close collaboration with the regions and the municipalities. For example, just last week, I was in The Azores where I visited the projects funded by the RF focused on affordable housing for young family and students. Once the project is completed, dozens of affordable apartments will be made available for these families. These initiatives clearly demonstrate how such funds can directly benefit people in Europe. As for cohesion policy over the 2017 period, 7,500,000,000 were planned for housing investment through the European Regional Development Fund, the Cohesion Fund, the Just Transition Fund, and INTERREG.
But the current Cohesion Policy programs were discussed between member states, regions, and the commission between 2019, 2021, and the partnership agreements were then signed in 2022. However, for several reasons, their implementation only started between 2024 and 2025, in a world that had become very different from the one in which they had been designed. Continuing to invest according to 2019, the priorities were no longer the right approach. Member states and the regions asked for more flexibility. We listened.
Through the midterm review of the equation policy, we amended the regulations. We gave member states and the regions the possibility to redirect part of their allocation towards today's priorities. Five priorities were identified together with you, with the ministers, and with the regions. Competitors, defense, energy, water, and affordable and sustainable housing. The results are substantial.
186 programs from 25 countries have been amended, with 137 of them regional programs. In total, 34,600,000,000 has been reallocated to these five priority areas. Before discussing the data on affordable and sustainable housing, I would like to speak briefly about the importance of the method used in achieving these results on the midterm review. Before launching this initiative, I met ministers, regional presidents, mayors, this parliament, and the committee of the regions. We identified the priorities together, and the results speak for themselves.
Three elements in the regulation made the difference. Volunteerness, flexibility, simplification. On timing, in April 2025, the Commission proposed a midterm review. By September, the council and the parliament had adopted the legislation through an urgent procedure. By December, member states submitted their programme amendments.
And in the following months, the commission worked with great dedication to process hundreds of amendments. For a policy of this scale, working under shared management, this represents an important act of speed and coordination. In addition, some flexibilities and incentives introduced remain in place until 2029, 2030. This means that member states and regions, if they want, can still reprogram additional funds as needed towards housing until the end of the programming period, for example. National and regional authorities from 15 member states reallocate funds under 84 programs, 71 regional and 13 national, to housing objectives.
In total, €3,300,000,000 has been redirected to housing projects. These are not projections. This is real money that the member states and regions have proposed to use depending on their needs and priorities to construct, repurpose, and renovate housing. Examples include student housing, housing for vulnerable people and low-income households, renovation of vacant homes, and unused buildings in town centers. This delivers on our commitment in the EU agenda for cities adopted in December to tackle the housing crisis by promoting investment in affordable, sustainable, and high quality housing through cohesion policy, the RRF and the other European instruments, including with the EIB.
At the same time, we are strengthening the role of cities in coordinating the public and private sectors and in responding to local needs by integrating innovation, social inclusion, and energy efficiency into housing policies. And as I said before, member states and regions can still reprogram additional funds towards housing, as needed. Honorable members, this experience has taught us something important. This is the right path for cohesion policy. The method works.
The fix the flexibility works. Coins policy has been delivered. The midterm review confirms that cohesion policy can adapt, anticipate, and accelerate in response to a rapidly changing world. But the work does not stop here. Together, we will continue building on this progress.
While housing is a competence of member states, we will continue to work on this issue in the future within the framework of cohesion policy and its ongoing modernization process. This issue is and will remain central as already demonstrated by the midterm review. Thank you.
Irene Tinagli
Thank you very much. Now we start our Q and A session and our exchange with the coordinators, and we start with Nicolina Brundjak from EPP.
Nikolina Brnjac
Thank you, chair, and thank you, vice executive vice president, Fito. And I will now switch to the Croatian language.
So I would like to thank you for presenting the midterm review of the outcomes of the cohesion policy, where we see how important flexibility is, in order for us to be able to face new challenges such as affordable housing, which is a great problem for all member states. And in order to have concrete solutions, we have to work at the local, national, and European level. This is why the Croatian government passed the national action plan where we changed some laws and bylaws in order to be able to collaborate with the local and regional authorities, which already have projects in place, so that we can now start building affordable housing for young people throughout Croatia. And we also have a new act, affordable housing act, which is very important for every citizen, because all the local and regional self-government units will analyze and see how many housing units they need. And based on this analysis, we will make other decisions.
We will be able to see how much money we need to set aside in the next multi-annual financial framework. Of course, we will not have enough public funding, not enough money to solve the housing crisis. So how does the commission intend to attract as much private capital as possible to deal with the housing crisis in Europe? I know that the pan-European platform was mentioned. So how to increase the investment in affordable housing through the private sector?
Thank you.
Irene Tinagli
Thank you very much. We collect questions by two. So now I give the floor to Andreas Schieder for the S and D.
Andreas Schieder
Thank you, Madam Chair, and good morning, Vice President. Thank you for being with us here. And as you also mentioned in the statement, we all recognize that Europe is facing a serious housing challenge, let's say, or crisis with many citizens, especially the young ones and also the low and middle income households, which are struggling also to have affordable homes. So this is precisely also the reason why the midterm review of the equation policies is so important. And therefore, my question is, how will the commission ensure that cohesion policy investment is generally prioritizing affordable and social housing and does not unintentionally contribute also to rising prices or speculative dynamics, which is one danger?
And second question would be, can you clarify what safeguards will be put in place so that the EU funds are effectively targeted towards public interest objectives, in particular, as I mentioned before, supporting social and nonprofit housing providers. And as you know, the parliament and the parliament committees are always standing ready to work constructively with the commission. But I think what we need is really to have a stronger social focus, ensuring that housing is treated not only as a market issue, but as a fundamental right and a core pillar also of social cohesion policy in our European Union.
Raffaele Fitto
Thank you. I would like to start from the first question about Croatia. I went to Croatia, and I met the prime minister and several ministers, and I spoke with them about these needs. And, they underlined the importance for Croatia, the of this, important priority. And following this method and with this important dialogue with all ministers, we achieved these important results that I would like to underline because if I came back for the first part of the discussion of the midterm review, I remember that it was not simple to explain the process over the modernization of equation policy.
But for example, we started with this important opportunity, with the midterm review. Now we can say that we have the first step of the modern equation policy. And, it is very important, the link with the private sector for this opportunity. We are working with the IB. You can also find in the affordable housing plan at this part of the proposal.
And I believe that could be very important to improve this kind of proposal. We are working in this direction. It is clear that the cohesion can give an important contribution. The responsibility is, as you know, the commissioner, Jorgensen. I'm working with him very close on also this opportunity, but it is important also to underline the result.
And to conclude, I would like also to say that Croatia redirect €52,000,000 for housing. It was a very important contributor in this situation. But we are open to work in this direction and also to have your suggestions about this opportunity with the private possibilities contribution. Second, I know very well and the European Commission has well about the needs of the cohesion of the housing. I would like to start from the beginning with the guidelines of person from the line.
This was an important point of the guidelines during the beginning of this European Commission. Then, I have in my mission letter a clear message about the opportunity, possibility to improve with the cohesion resources, the contribution for the housing. And after the approval of the affordable housing plan, we gave the clear vision about the role of the European Commission. It is important to underline the fact that the responsibilities of the member states, but we are working very close with the member states. For example, in the midterm review, we put this priority, one of the five priorities like housing, because in all my meetings in the member states, in the parliament, with the cities, in all situations in the mission, in the member states.
The point of housing was not a priority, but was an emergency. And, we know very well how it's important at this point. And the opportunity that we are given with the midterm review, and also to continue in this kind of work, is to create the condition, a very close link between cohesion policy and dowsing. Because if collision policy, have to create the condition to reduce the disparities, this is fundamental for the two different situations that we have. One is in the cities because we have in the cities this big problem over the overpopulation.
I mentioned also during my speech, we know that 75% of the citizens in Europe live in urban areas. This is a very huge problem, but it is important also to underline the second part or the second coin of the problem because we know that we have this same problem in the rural internal areas, in particular, where we have to give the result, the opportunity also to achieve the opportunity to give the right message to the young people in particular. And in this direction, we are working because, as I said, we approved the you for the first time in the European agenda for the cities where you can find this point as one of the most important points. At the same time, we are working now to give the second important answer about the right to stay. We are working to present the strategy for the right to stay.
On May 6 in the parliament, we organized an important meeting to launch the strategy for the right to stay. It will be important. We'll have the presence of Eric Coletta because he mentioned in his report this part was very important, but also president Mezzola and the president Catatuto to involve also the regions and the cities to launch the public consultation, because right to stay to face this another important challenge have to be an important opportunity to involve all interlocutors at institutional and the stakeholders. This is our objectives, and I believe that it is fundamental to have the right approach. And the social approach of this important priority is the right approach.
I fully agree with you. Thank you.
Irene Tinagli
Thank you very much. Now I give the floor to Clara Dostalova for the Patriots. Thank you.
Klara Dostalova
Very much, chair, and thank you very much, dear Mr. Vice President, and thank you for your presenting the result of the midterm reviews of cohesion policy. I would like to repeat the numbers. Within this review, a total of €34,600,000,000 has been allocated, and €3,300,000,000 directed to affordable housing. Under the RRF, almost €19,600,000,000 has been mobilized for housing.
And this is precisely why the key question today is how this area will be ensured in the future MMF. In this context, however, a legitimate concern arises as to whether the new budget architecture may weaken the territorial dimensions and the very place-based approach, which lies at the core of cohesion policy. At the same time, it is necessary to ask whether future investment in housing within the national and regional partnership plans may be crowded out by other important priorities such as defense, migration, energy, or competitiveness. And therefore, I have two specific questions. How does the commission intend to ensure that affordable housing becomes a stable component of the future MMF after 2027 and that no investment gap emerges once the RRF comes to an end?
And the second question, how does the commission intend to ensure that the future European Competitiveness Fund, which is strongly sector oriented, sufficiently takes into account the territorial dimensions and does not contribute to the widening regional disparities. Thank you so much.
Thank.
Lara Magoni
You, madam chair. Good morning, Vice President Fitto. Thank you for your presence and that very important information. Within this committee, we have colleagues who act on housing. I'm from Lombardy in Italy, and it's an issue there, but it's an issue across Europe.
And therefore, it's good that these issues, which are so important, be discussed within this committee. And it's good for you to be here. I had a question for you. Housing is not just a social issue. It's also a vital condition for territorial cohesion.
And hence, it's.
Lara Magoni
One of the most specific tangible challenges facing the cohesion policy. Just to give it making this right to stay a tangible reality is the fundamental question. From the mountains, but as we've said, each area has its own fragility. Often, our public space is downgraded, is underused. There's a lot of scarcity of housing for families, particularly certain valleys are already suffering.
And housing prices are simply out of reach for those living there, meaning particularly the second homes in such regions price people out of the market, locals out of the market. This is a significant challenge facing Europe, and a lot of European citizens that live in mountainous regions as an important fact here, which is 60% of young people would like to stay where they grew up. And therefore, that's the challenge facing cohesion. Instrument to actually allow people to continue living and working in their own area. To do that, they need to be able to afford housing.
And they shouldn't be condemned to a few leading assistance without hope or without that future. They have to be able to realize their potential. Now it was a step in the right direction what you're doing, because it recognizes that our territories are not peripheral areas to be managed, but they are part and parcel of the European project. So how does the commission intend that the greater flexibility under the regulation will actually translate into targeted measures for these areas, in particular, in order to reuse existing buildings, access to housing, and what specific instruments will be made available to local authorities? Thank you.
Irene Tinagli
Please, I really beg you to stay within the two minutes. Otherwise, we will not make it. Mr. Fito?
Raffaele Fitto
Thank you, sir. The first question is about the future because the question is the next MFF and the proposal, that the European Commission did last year about the new structure over the new budget. I know that this point is a strong discussion about this, but I would like to focus on the point for collision policy in particular. As you know, we have a new structure in the first fund. The proposal of the next MFF goes in the direction to give more flexibility and more simplification.
And to achieve this result, we have only four funds. The first fund is the fund for the National Regional Partnership Plan, where the European Commission put all resources that we give to the member states. I avoid entering the details of the amount because, as you know, we have now a discussion in the parliament and the council. Probably, it will be important to discuss about it after the final first step when we know the amount of the budget and the amount of the single funds. But from my side, it is very important to underline some points that we have in the regulation of the National Regional Partnership Plan.
First of all, we have the pre-allocation of EUR 218,000,000,000 for the less developed regions. Second, we keep the three categories of the regions: less developed, in transition, and more developed regions. Third, we put the principles of equation policy, multilevel governance-based approach. And all these issues are very important with others because, in the regulation, we gave the possibility to continue this kind of work. But I believe that the future of collision policy, it is not possible to be the same because the world is changing, and we have to understand that it's necessary to adapt collision policy at these new challenges.
And the midterm review, it is a very clear message in this direction because we gave the possibilities to the member states to decide. The five priorities we decided together because I shared with the European Parliament, with the national governments, with the regions, with the cities, with the Committee of Regions. And in the five priorities, we have the different needs. Because I know that, for example, defense was a big problem in that moment. But if we moved in this midterm review almost €12,000,000,000 for defense, it is not our imposition.
It's a free decision for the member states because of the eastern border regions. The member states where they have the mid eastern border regions decide to adapt their cohesion programs to these new needs, like the Baltics and Poland in particular, for example. And we put also another important issue that is cohesion in my opinion, because I visited these member states and these regions to the border, and I saw directly the problems that is not only for defense and security, but it is also the need for, also for the cohesion policy because in these regions, we have big problems also for cohesion for development of these territories. But when we gave the free decision, the voluntary basis for the member states, we solved the problem because we gave the general point of the possibilities to readapt the programs, but respecting the decision from the member states. And this is, I think, could be an important method also for the future. In the national regional partnership plan, we will see the governance because we have to speak to the side about the governance.
Now it is not possible to anticipate something in this direction because, as you know, the European Commission did the proposal, but we have to wait the decision of the parliament to the council, then we will have the opportunity to enter in this kind of details. But the message that I want to give is very clear about the perspective of education policy. If we continue in the process to modernize collision policy, we can have a collision policy for the future. If we can imagine that we have to defend the old cohesion policy, it is very difficult to have this because cohesion is one third of the European budget. It is important to be concrete in this direction.
But midterm review, it is a very clear positive example of how it's possible to adapt it. And.
Then to respond to Miss Mogoni's question, why it's quite, I'd love to be very clear. We are working. We are updating things in the context of the future budget. And in that context, we are deploying strategies because giving actual tools to member states, to the regions, local authorities to actually implement future national plans at regional level is very important. We have an agenda for the cities.
We've approved a strategy for the eastern border regions. We are in the process of, what will be over the next few months, presenting the strategy for the overseas regions. And we're about to put forward the strategy for the island regions in June. And we're also working on a strategy for the right to stay. So those five strategies, all of them have touched on each of those different requirements, some of which you alluded to within Continental Europe.
And right to stay is very important here because I would remind you that before the con we had a public consultation, and I don't want it just to be a strict a normal straightforward public consultation. It'll be a wide-ranging conversation, so that we have a full picture of all the different nationals, national situations such as you depicted.
Aaron Malloy for renew.
Ciaran Mullooly
Thank you, Chair, and good to see you, Commissioner. My apologies for missing the start of your presentation. I was at your old committee, the Reggie Committee, this morning, where we were talking about cross-border cooperation. Firstly, let me break my contribution into two parts. The good news, you did what you said you would do.
137 programs amended in the midterm review. And in my constituency, I'm glad to say the facts are good. There was a total of 61,000,000 flexible assets within the fund. 47,000,000 was redirected towards housing. This is exactly what we called for, and I welcome that.
I think it reflects the scale and the urgency of the housing situation on the ground. The problem for you, commissioner and executive vice president, is now much broader. We have changed. I quote the European Central Bank, which tells us that Euro Area inflation has now increased by 2.5% in March 2026. The world is changing since you started the midterm review, and there are implications for housing, commissioner.
Huge implications for housing. We discussed in our committee many times as vice chair, I highlighted the fact it's estimated we need 18,000,000 housing workers in Europe to deal with the construction problem, the housing shortage. We have 13,000,000. But regrettably, commissioner, instead of going up, the number of workers is going down because of inflation and the fuel costs in particular. In my constituency today, we have people protesting peacefully on the side of the road with regard to the cost of doing business.
Petrol and diesel largely, and gas to some extent as well. These are builders, plumbers, electricians, people who work and must drive for work. They're not dissidents. They're not far-right. These are workers, honest-to-god workers, but they cannot do it because of the margin.
So my question to you, commissioner, executive vice president, and indeed president of Underline, what measures can you bring forward now to deal with the effect of inflation on the construction sector? How can you stop another slowdown in construction in the coming months? Are you going to look at measures such as resilience funds, special support funds? And how can you ensure that we don't go backwards in construction, instead of forwards? Thank you.
Irene Tinagli
Thank you very much. Now I give the floor to Gordon Bosanac for the green.
Gordan Bosanac
Thank you. Welcome, commissioner. It was really good to see the numbers, and, actually, that midterm review has given some results in the housing that some of the member states really did their job. But I would like to give you two examples of reality check, how we can maybe improve the things. Because for me, it's the question, it's not only the numbers, how many, how much money the member states have dedicated to housing, but in which projects in housing.
And I can also tell you from my country, Croatia, as my colleague Nicole already mentioned, we have seen, for example, that the partnership principle and code of conduct again didn't function because we are seeing some cities who already started to build the public stocks with no approach to EU money. They were not even invited to the table to sit with the government and see if the government can transfer the midterm review money to those cities. So we still have a problem that the EU funds are sometimes politicized. So I'm asking you again and again, and this parliament is asking you again, especially on the new MFF, that we have to improve the partnership principle because this is not the way how it can function. And the second thing is about how you can be sure that the money which was given to the member states will not contribute to the further financialization of the housing crisis.
Because we have seen, unfortunately, that this parliament in the report didn't recognize financialization as one of the key triggers of the housing crisis. Unfortunately, the commissioner is recognizing this, and he's aware of that. So my worry is, do you have some safeguards when you receive the proposal from the member states that you look at it and see that this money will not make more mess? I can just give you one example again from my country, Croatia. We have more than half a million empty stocks, empty flats in Croatia.
So the government wanted to mobilize those half a million. Instead of increasing the taxes on those flats, they offer to the owners of those flats amounts of money to buy those flats for ten years, for example. And they gave them immediately €50,000 to get those flats, and then put them on the market. So it was a direct, completely wrong decision to do. Unfortunately, this measure has failed because they managed to mobilize only 300 flats.
But this is the way which we should not ever invest European money because we are just deepening the crisis. So, what are the guarantees that we are not making things worse?
Irene Tinagli
I group this time by three before we finish the coordinator's round, before we move to the, and we gain some time because we are running late. So Irene Montero is for the left.
Irene Montero
Thank you, President, Vice President. I am going to speak Spanish.
Vice president, I'd like to ask you something. Would you sleep here? Would you live in this place? This is a sofa bed. This is rented out for €250.
Otherwise, we have this other example. Would you live here? Would you live with your bed in the kitchen? You can also open your front door from your bed. That is €700 in rent.
Here's another example. This windowless room, 13 square meters, €850 a month for this windowless room. Would you, at 35 years old, 45 years, 50 years old, share, live in a house share? That's what a large number of Spaniards are doing. What?
That's what I want you to think of when you lunch with these landlords. I want you to talk to them about the rubbish that they have put on the rental market. Then we have worries about squatters' rights, but what about the fear of not being able to start a family, of having to live in a house share at 40 years old, about not being able to make your rent no matter how much you work, not having a salary that is enough to rent. 95% of the population has these concerns, but why are we always worried about the 5% who are unscrupulously running their businesses like this? The truth, mister vice president, is that you or any other commission would not want to see your children living in this kind of place.
And yet, we were surprised when we see people revolt, but they will one day because this is not possible. We have to fight speculation. We have to lower prices, and we have to make sure that the people who do this know that they are absolutely delinquents. Thank you.
Raffaele Fitto
Very briefly. First point, the cost of inflation, I think that it is a problem that we can face with the member states. But I can imagine that in the proposal of the national government, we have also included the cost of inflation because if the member states will launch a tender to realize some apartments or housing, I think that we have to imagine also the cost of inflation in this case, also for the other situation that we have. We are working as you know, yesterday, we had an important college of commissioners about the situation that we have. And next week, we will present a new proposal for the energy to send this proposal for the next council.
As you know, we have an extraordinary council in Cyprus next week, and we will see, because it is important also to remember that the decision is with the European Commission that proposed and then the council that will approve it. We will see also the process about this in the parliament also. The second issue, I cannot enter the details, in the situation that you have in the national situation. I don't know. And for me, it's not possible to enter in this.
I don't know if you have some projects where there are difficulties or problems. If there is some risk about this, I can say that the European Commission has a clear role to control the coherence of the proposal and the realization of the projects. And, I would like also to have the occasion to link also the other questions because I think that it is important to clarify one issue. Housing is not a competence of the European Commission. It's a competence of the member states.
This is a fundamental point because I know that this is a fundamental issue also for the questions, because I fully agree with you. And the European Commission, for these reasons, started from the beginning with the guidelines of present from the line, with this kind of work for cohesion, for example, implementing the resources. Because today, the new news is that, from the last my presence in this committee, when you asked to reorganize cohesion because it's fundamental to give these resources well, now we are here to verify this work, and we can say that we achieved this important result to reprogram these resources. It's a sufficient number. I know very well it is not sufficient, but this is an important signal in this direction.
And I know that we have not a problem, but an emergency, because I'm going in the member states, and I'm visiting also this kind of situation. For example, in this month, we'll go to the next week to go to Ireland, and I will have the opportunity also to enter in these details. And I know that we have a different situation in the member states, in the cities. But now after one year, I think that we started with these two important proposals. One is the affordable housing plan.
The second is the European agenda for the cities as a vision, as a program about this. The third is the point about the resources, and the midterm review goes in this direction. And we have to continue, but I have not a responsibility for these issues directly. Yes. But this is the truth.
I'm here to present our effort. It is very important, our effort in this year, because we achieved this important result that I would like to emphasize because 3,300,000,000 in a few months was an important work that we realized together with the member states and the regions. And we have to continue in this direction because it is impossible to solve the issues in a few months. It is important to start with a vision, with a program, with affordable housing. Plan is an important moment to give the vision about the needs that we have in this context, and then we have to continue.
And the midterm review is open because the member states can propose the opportunity to move other resources for housing. And we are insisting in this direction to have also the opportunity to continue in this kind of work. But the picture that you showed before, yes, I know. But it's not only in Spain, in also in other member states. And I know that this is the situation, but we are working in this direction.
But for us, it is impossible to do a miracle. It is important to work step by step. Today, I think that we have one good piece of news about the midterm review, and we have to continue in this direction.
Raffaele Fitto
Yes. And Spain allocated 268000000 for midterm review for housing. I think that is a good signal. It's one of the probably is the second or the third member states to reallocate the resources. Yes.
I know that it's not changed nothing about this. Nothing. No. Because this is the result. But I repeat, we are in the current budget.
It is impossible to imagine a miracle. It is necessary to be concrete because one thing is to hope, and to hope. But another thing is to be concrete to realize the opportunity. This is one good signal, and I believe that we have to continue in this direction. Also, with the suggestions that also this kind of the dialogue this morning is doing because it is positive, the contributions that I listened this morning.
Irene Tinagli
So, of course, what we are just to clarify to the colleagues, the midterm review gave this opportunity to allocate a certain amount of money to reallocate it to housing projects. The deadline was December 31, which means like 3 months ago. So now we are presenting the results of the request. Of course, it's not that in three months, all this money has been spent and the projects have been built. It's a little bit unrealistic to think that this could be done in a month, but this is the purpose of the meetings that we are having here.
This is the purpose of the exchange of use with the commissioner. So, commissioner, you can be sure that maybe, you know well, next year, I don't know if we will be here, but the parliament for sure will keep monitoring, and then we will ask you to come and tell us how this is progressing, how the member states are doing with the money that now has been allocated. So I think this is the whole point of what we're doing here. In the past year, we have been pushing. And together with you, we have asked for more flexibility.
The commission has delivered, and the member states are using these instruments. Now, of course, it's all of our effort and duty to monitor, to make sure that this effort keeps going and delivers some solutions. Now we move to catch the eye. I have several colleagues registered, so you have one minute each. We start with Borja Jimenez Laraes for the EPP.
Borja Giménez Larraz
Thank you, chairman. First of all, flexibility through the midterm refund of the cohesion fund is a very good piece of news. We need to meet the needs of European citizens. Now I have a question. According to an EIB report for 2024-2025, cohesion policy alone will never resolve the current housing crisis.
We have a lack of investment, millions shortfall when it comes to investment in affordable housing. So we need private investment. We need to encourage and leverage private investment through every euro spent from the cohesion fund. So will the commission come up with guidelines to promote public-private cooperation to leverage as much funding as possible for affordable housing? Thank you.
Alicia Homs Ginel
Thank you, Chair, Vice President. A question that was already brought up was overpopulation. When we look at that, we also have to think about island territories because we also have an additional difficulty here. So that's my first comment. Then on the midterm review, as you've explained, we recognize that affordable housing is a strategic priority for the EU, and it's included by the Commission in these plans.
And we're very happy with the flexibility to be able to reprogram funding, and deal with these urgent issues. It's very important that we're clear because this housing crisis isn't just about investment, although, of course, it does have to do with this, but it's also got to do with the model. We have structural issues with accessing houses, not just amongst vulnerable groups and young people, but also with the working class. So it's essential that we ensure that funds are used for affordable housing, but it's also very important that we go further and that we ensure that the public funds remain for public issues, and we need to avoid speculation. We need to stop speculation from being such a big issue for the market and in local regions, and we need sustainable solutions.
So my question is, will the commission ensure that the additional investment will also be followed by a transformation of the model, and to ensure that the speculation, we put an end to the speculation, and so that this is sustainable for future generations. Thank you.
Martin Hojsík
Thank you very much, Vice President. And indeed, this is a crisis which has a huge, huge impact on anyone who wants to actually have a family. When we keep on hearing about, you know, the need for, the ability of the young people to and willingness to have family, is something which is a massive, massive impact because simply they don't have the space to do that. And I'm very happy that the commission is looking into something which doesn't have a very clear competence in, and I'm happy that this house has also taken up the issue. Now I wonder, when you talked about also the relocations on how and how are you going to enhance the control of the use of your money so the housing doesn't end up building villas for the cronies of the government as we've seen in some of the member states, because this is indeed going to be the problem.
Also, how are you going to look into the proposals from the member states that this is not going to fund, so to say, investment flats, investment houses, which again are something is not helping to solve the housing crisis. I would like to also highlight the need of the really real partnership principle, because what we've seen in a number of the Member states is that it's not being upheld. And I wonder what is the issue, what is the approach that you are doing to try to really check if the member states are doing it? And last but not least, a very short comment on how do you want to help to enhance the role of the EIB in the funding, because ultimately, this is investment. This is something which comes back, especially when it comes to rental housing, municipal rental housing.
And I believe this is a really important opportunity, because we should not fund private gain. We should fund public goods. Thank you.
Daniel Buda
Commissioner, I congratulate you sincerely for the way you've managed this financing for the housing crisis from the cohesion policy. This is a very important integral part of what relates to the visibility and efficiency of the cohesion possibility, the right to stay. But at the same time, allow me to tell you two things I've noticed following two visits, one in Spain and one in Portugal. We cannot solve this solely at the European level. There is national legislation that I think blocks, reins in the construction of housing.
We cannot solve Spain's housing problem from a European level, or we cannot solve Portugal's problems related to the permitting times. So we need to send a clear, firm message. We can solve this not only at the European level, but also at the national level where we need adequate legislation. And there's a I have a question about the lack of labor. We are told we don't have workers, although in Portugal, there are lots of migrants.
So how can you, do you think we can solve this problem? Thank you.
Vincent Martha for the Greens.
Vicent Marzà Ibáñez
Gracias. Thank you.
Let me be frank. The midterm review and the European funds earmarked for housing will be used to ensure affordable housing. That is my question. Can you guarantee access to affordable housing? We need to attach conditions to these funds.
Otherwise, we will feed speculation and financial trickery all the more. We've heard clamors from different groups. Some will vote against this report unless we have clear conditions. We want to ensure that we have clear solutions, rather than further exacerbating problems. And without strict conditions, that will be the case.
European funds are public funds. The housing should be protected, but within two or three years, they could end up being part of speculation. We need to ensure that the funds are accessible to those on low and medium incomes rather than those on high income. Otherwise, it will fuel speculation. So how will these funds be used?
Ensure that there are conditions attached. Ensure conditions are permanent. Ensure that we have affordable housing that is linked to families' income levels. That is what we are calling for here. Be braver.
Be bolder. Tackle the root cause of the crisis. Offer a European hope, a positive perspective. Don't merely say we've paid lip service to it. We've earmarked funds.
That's it. We need strict conditions attached. Ensure that you harness the majority of citizens represented here and ensure that you tackle their needs. Thank you.
Regina Doherty
Thanks, chair, and thanks, commissioner. This has been a very thoughtful exchange. I want to say that given the midterm review recognizes housing is now a priority, but the practice of the cohesion funds, I think, still remains structurally ill-suited to actually helping people, particularly when we're addressing scale and the urgency of the crisis. I want to ask specifically in relation to Ireland, given the cohesion policy allocations are primarily based on GDP per capita. And that given that Ireland is relatively income rich in that terms, we still have a severe pricing shortage or issue with regard to people being able to access affordable houses.
So given what my green colleague has just said, I want to ask you, would you consider or would the commission consider introducing housing affordability indicators into the cohesion allocation criteria? Or maybe more specifically, would you consider creating a direct flexible funding pathway for large-scale delivery of affordable houses and cost rental other than the EDR piece? I'm talking about directly funding builders and developers to be able to develop at scale, particularly in the urban sector. Thank you, chair.
Isilda Gomes
Thank you, Chair Vice President. Something here is really concerning me. This has to do with public housing, social housing. We know that some countries have 4% of social housing, and then others in the EU have 30%. So the funds that are allocated by the EU should serve, that they strike a balance.
It should be used to solve the problems of the most vulnerable families of young people who have a job but still have to live with their parents. They can only move out at 30, at the age of 30 or so. So social housing is fundamental, and we need to ensure that the funds are applied correctly. So we need to look at what the percentage of social housing is. Now that is cohesion.
Cohesion is about improving the circumstances of the most vulnerable among us, because middle-income people are more likely to be able to buy a house. But I would like to also draw your attention to something else: speculation. Investment funds. There are investment funds in some countries that do not pay taxes, and yet they own entire neighborhoods. And their only purpose is to speculate and to sell when the prices are high.
Thank you.
Raffaele Fitto
No. Very busy because, have the same different approach, but the point is, to three. First, a financial instrument. We have in the affordable housing plan an important instrument, where it will be possible to put together the financial national, institutions financial institutions with the AIB to create this important issue. This is one important point of the affordable housing plan, and this will enter in the second semester of this year.
This is an important issue from my side, and I believe that it is important also to improve, to give more opportunity in this direction. Second point, the control over the resources that are mentioned from different members. Yes. I fully agree because we are presenting, we are speaking of the housing. We gave this opportunity.
The member states presented this kind of project. For me, it is normal logical that these resources will spend in this direction. It is impossible to can imagine that is not the final use of this resource. And for this, I can say that we have different kinds of projects. One is student accommodation.
The second is vulnerable groups. The third is vacant home renovation. The fourth is affordable housing, and the last is the other major focus of investment. Why would I like to explain this better? Because for each proposal of each member state, we have the different situation about this.
And I believe that we are going in the right direction because, for example, the majority part is for the vulnerable groups. This is a clear answer in this direction. Yes. We have to control clearly. We are giving the resources for these kind of projects, and I have to think that the projects are right.
It's not a problem. But I accept your suggestion about the necessity to have more control about the realization of these projects. Yes. And we will also follow the midterm review adaptation in the next months, because I know that this exercise was very important. We are speaking from almost 35,000,000,000 in total.
It is very important to verify in the member states, in the regions, the real situation about the use of these resources. The other point is the point about the mentioned about islands. I said before that we are working in this direction under the secret presidency. The goal is to present, in June, the strategy for islands. It's different than the outermost regions. Two different issues.
And we think that it will be possible to close this proposal to approve this strategy in the college in the first week of June, and we will present under the CPOT presidency. We received 100 more than 300 contributions in the public consultation. It was a very positive exercise, and I think that this part could be important to be present in the strategy for Ireland because it is a very specific issue. And to, Nick also for the other point, I mentioned during my speech, introduction speech that I visited last week in Portugal in the Azores, one project for housing, very, very important, very positive, financed with other programs. And I agree with you about the words that you mentioned, and I can say that Portugal presented the request for 656,000,000 was the second member states for the amount, and I believe that is an important issues.
I know because I met, for example, in Lisbon, the representative of the local authorities and the mayors, and all, said clearly that is a very important emergency that they have. And we want to continue in this direction, but also for the other member states because during my visit in all member states, I'm verifying that the situation is the same in all member states. We have to continue in this direction. I think that I don't know the perspective of the committee, but or in this committee or in general in the parliament, I think that it will be possible to continue this dialogue. I was a member of this parliament.
For me, it is fundamental, the dialogue and the cooperation with this house, and this is my approach. And I would like to thank the chair and all of you for the contribution and for the common work that we have to do also for the next steps. Thank you.
Irene Tinagli
Thank you. If you allow me access to, but I have a small question myself. No. Because it was really interesting. On the issue of conditionality that the colleagues were asking, of course, we know that the midterm review gave the opportunity to channel the money, to reprogram the money towards affordable housing.
That was pretty clear. I think that the concern and the worry of some colleagues and frankly of mine as well is, do we have any sort of safeguards to make sure that this affordable housing that will be built with this money will remain affordable for a long, for example, when we that with the review of the state aid rules, there was a conditionality of 20 years minimum to remain. Now, honestly, I admit, I don't remember if there was something like that already in the, but I don't think so. I don't recall having read this kind of conditionality in the mid-term review. So maybe the question is, do you think there is a way in the upcoming months to make sure that we have something like that in the implementation of the projects?
If it's possible to do that, then we will keep looking into that.
Raffaele Fitto
Yes. The proposal depends on the member states. This is clear. But the proposals, yes. But the proposal goes in the direction of affordable housing because this is the request.
This is the point. This is the priority. It is impossible for my side, for our side, to have another kind of projects. And we will verify this clearly, not only for this priority, but also for the other priorities because it is fundamental that if we give this opportunity, we have to be sure that the result, it will be this. It is clear.
And if you have, because I understand that there are some risks in some member states. Yes. If you will mention this, it is possible to verify directly this situation. But our work will go in the direction to verify also for the another priority, defense. We have the dual-use military and civilian.
It is important to verify the project of this priority. Now we have this proposal for the member states, then we will organize our DG to verify directly with the member states if the request that the member states, the regions presented, go in the right direction to respect this region. This is, for me, fundamental because we are giving this opportunity, but we want to respect these five priorities very clearly. It is impossible to go in a different situation. And for us, it will be important also to organize the next steps to verify because we are giving prefinancing the incentives and more time because we postpone the date for the program for '29 to 2030, and it will be fundamentally crucial to respect the right approach, the coherent of the proposal.
For our side, it will be fundamental. I can say sorry. I can say clearly that if we do not have the respect of this approach of this project, we will intervene in this direction to avoid this. I want to be clear about this.
Irene Tinagli
Thank you. Thank you very much to all the colleagues. Just as a reminder, we resume this afternoon at 3:30 with a public hearing. In the meantime, I really want to thank the Executive Vice President for the availability and for answering all the questions, and to all the colleagues for participating.
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