The number of companies supported by PT2020 has been decreasing for six months due to “cancellations/revocations”. In the first three months of 2023 there were 391 fewer companies.
Almost 400 companies saw the cancellation, in the first quarter of this year, of the community support they had already received, reveals the Portugal 2020 Quarterly Bulletin, published on Friday.
The Executive has a clean-up operation underway to release funds that are allocated to stalled projects and thus be able to finance others that have also received the green light, but which are overbooked (approvals above the initial allocation) precisely so that no funds are wasted.
The application to all PT2020 operational programs of a recovery grant was announced in Parliament, in May last year, by the Minister of the Presidency, which oversees the European funds.
Cancellations can arise for three reasons:
or because the project did not comply with the rules defined in the contract signed when the community incentive was granted;
because the company has given up on going ahead with the project with support from Brussels (the company can even continue to develop the project, but without funds from the EU framework);
or because there was a revision of the project’s ambition. In a context of escalating inflation and a war in Europe, many companies have chosen to be more cautious in their investments, which may also have reflected in these cancellations.
The Incentive System’s monthly bulletins, which only reveal the balance between the approved incentives and the operations cancelled and not the total value of the cancellations, have already indicated this reality. The authorities managing the incentives for companies have been cancelling projects with no execution for nine consecutive months. In other words, from July 2022 to March this year, the balance between approved incentives and cancelled operations was negative. In fact, there have been cancellations since February, with the exception of June. In all, at least 505 million euros were released, 135 million of which were only from January to March this year.
Now, the quarterly bulletin gives a new perspective of this reality. Once the number of companies supported by PT2020 is disclosed, it is possible to see that this number is decreasing for six months: in the fourth quarter of 2022 there were 83 less than in the previous three months and in the first quarter of this year there were 391 less companies supported. It should be noted that in the second quarter of 2022, 181 companies also lost community support, due to “cancellations/revocations”, as can be read in the footnote.
It is also possible to see that the cancellations of companies are transversal to all the operational programs, from Compete to the Regional OP of the Continent and Madeira. Only the Azores OP supported one more company. The North OP was the one that cancelled the most support (148), followed by the Center (75).
But the clean-up is far from being done only at the company level. The physical indicators, published in the bulletin, reveal that there was a reduction of almost 20 thousand square meters of public or commercial buildings constructed or renovated in urban areas, 55 kilometers less of railway lines intervened, due to “adjustments to the decision”; or still, 17,350 less square meters of open spaces, created or rehabilitated in urban areas due to “rescissions/revocations/decreases”.