Finance
EU finance ministers deadlocked on RRF extension and EIB defence spending
European finance ministers fell short of achieving any breakthroughs at their meeting in Luxembourg on Friday (12 April) as divisions persisted on whether to prolong the bloc’s multibillion pandemic recovery fund and how the European Investment Bank’s (EIB) lending criteria could be widened to include defence-related assets.
Belgian finance minister Vincent Van Peteghem told reporters following the meeting that there were “different views” among ministers about whether the EU’s €723.8 billion Recovery and Resilience Facility (RRF) should be extended, adding that “some member states… emphasised the one-off nature of the facility.”
Commission executive vice-president Valdis Dombrovskis, however, defended the “ground-breaking” nature of the fund, whose “design and flexibility have helped us to tackle new challenges, such as high inflation [and] energy security issues.”
“The RRF re-assured financial markets on the EU’s resolve to tackle the Covid-19 challenges, ensured a rapid flow of funds to member states in a time of great difficulty, played a key rule in preserving public investments and sustained a solid recovery, returning the EU economy to pre-pandemic levels sooner than expected,” Dombrovskis said.
Meanwhile, Van Peteghem noted that “on specific issues, further discussion is needed” on how the EIB could potentially step up support for Europe’s security and defence industry.
However, he said there was still “large support amongst ministers to move forward” with an “action plan” — the outline of which was presented to ministers on Friday by EIB president Nadia Calviño.
Before the meeting, Calviño informed reporters that her plan would include the results of a two-month investigation into the “definition” of so-called dual-use technologies, as called for by EU finance ministers in February.
The EIB’s current mandate limits the range of permissible defence-related investments to dual-use items that should be used mostly for civilian and military purposes.
Most of the technology’s expected future revenue must also derive from its civilian use.
The bank is explicitly prohibited from investing directly in weapons, ammunition, and “core” military infrastructure.
Panaceas for Europe’s investment and security needs?
The RRF and the EIB have been objects of growing attention by European policymakers in recent months.
The RRF is viewed by many as a source of much-needed financing for member states still reeling from the twin shocks of the COVID-19 pandemic and subsequent energy crisis.
However, several of the so-called ‘frugal’ EU countries — including Germany, the bloc’s largest economy — are resistant to extending the facility beyond its scheduled expiry in 2026.
Meanwhile, the EIB — the world’s largest multilateral lender by assets — is seen by many member states as a potential tool to boost European defence expenditure, as Russia’s war in Ukraine continues to rage into its third year and member states assess ways to step up their defence capacity.
Last month, the European Council “invited” the EIB “to adapt its policy for lending to the defence industry and its current definition of dual-use goods, while safeguarding its financing capacity.”
In February the European Parliament called on the bank to “enhance its support… to the European defence industry,” urging it to overhaul its investment eligibility criteria “so that ammunition and military equipment that go beyond dual-use application are no longer excluded from EIB financing.”
However, several stakeholders have expressed deep concern about the EIB’s possible move into defence-related spending, citing the possibility of the bank losing its high ESG and triple-A credit ratings.
‘No discussion of scandal’
Van Peteghem, whose country currently holds the rotating presidency of the Council of the EU, told reporters that there had been “no discussion” among ministers about the recent scandals involving RRF financing.
Last week, the European Public Prosecutor’s Office (EPPO) announced that 22 individuals had been arrested in Italy, Austria, Romania and Slovakia for embezzling €600 million in RRF funds.
In an interview with Euractiv on Tuesday (9 April), European Court of Auditors president Tony Murphy said that the facility’s scheduled expiry by the end of 2026 is “contributing to the risk” of the funds’ misappropriation by amplifying “pressure on member states to spend this money quickly.”
“That in itself inherently raises the risk of people being opportunistic and taking advantage of shortcuts or whatever might be there,” he said.
Murphy stressed that a lack of central oversight was “amplifying” the likelihood of the funds’ misuse.
His comments came on the same day that European Commissioner for Economy Paolo Gentiloni called for the RRF to be used as a “blueprint” for future EU funding programmes — arguing that the bloc would “benefit hugely from a permanent, safe asset commensurate with the size of its economy, and this will be a big issue to discuss for the next Commission.”
Agreed at the height of the COVID-19 pandemic in December 2020, the RRF comprises €385.8 billion worth of loans and €338 billion in grants, financed through debt jointly underwritten by EU member states.
The funds, the flagship component of the bloc’s NextGenerationEU (NextGenEU) initiative, are intended to boost Europe’s post-pandemic recovery by financing green, digital, and other critical investments in exchange for targeted reforms.
[Edited by Anna Brunetti/Rajnish Singh]
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With rising interest rates, a war in the Middle East and high fuel prices, a lot of property investors are likely feeling a little cautious about the current environment. For many buyers, the instinct to wait for certainty feels like the responsible thing to do.
Wait until interest rates stabilise, the news headlines improve or until the market feels safer. But in property, certainty often comes at a cost.
Some of the most significant buying opportunities emerge during periods of uncertainty, when headlines are negative, confidence is low, and most buyers are sitting on the sidelines. This pattern has a name. I call it the V effect.
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The V effect captures what typically happens during periods of disruption, whether economic shocks, natural disasters or geopolitical events. Markets experience a sharp drop in activity and sentiment, followed by a recovery that can be just as swift. At the bottom of that V is where opportunity tends to be the highest.
During this phase, competition thins out, vendors become more flexible, and some withdraw their listings entirely. Properties take longer to sell. The market slows, but it does not stop.
The length of any downturn depends on the nature of the disruption. Localised events such as flooding or cyclones may compress activity for two to four months while recovery takes place. Broader economic or geopolitical shocks can extend that window, but sentiment can also rebound quickly once confidence returns. What remains consistent is the pattern itself.
When uncertainty peaks, activity drops. When certainty returns, buyers flood back in. And this is where many buyers misread the cycle. By waiting for conditions to feel safer, they are effectively waiting until the market has already begun recovering, moving up the right-hand side of the V. Competition intensifies, prices firm up, and your ability to negotiate diminishes. The moment that feels the safest to buy is often the most expensive one.
Buyers who act during uncertainty position themselves differently. They face less competition, have far greater negotiating power and can secure properties on better terms. When the market recovers, as it has consistently done throughout history, those buyers benefit from the uplift that follows.
LEXINGTON, Ky. — As the school district works to rectify potentially decades of inaccurate accounting, two finance employees with Fayette County Public Schools are on paid leave. At the same time, two external reviews continue for Kentucky’s second-largest school district.
FCPS Superintendent Demetrus Liggins said he’s been made aware of troubling and deeply concerning information.
“I’ve spoken with several of our district’s financial advisor and our external audit firm and have conducted our that’s conducted our routine audit. and those conversations have also revealed issues that I was unaware of,” Liggins said.
One review is from accounting firm Weaver and Tidwell, hired by the district, and another, which Liggins said he requested, is being conducted by the auditor of public accounts.
While those reviews are ongoing, and based on preliminary reporting, Liggins said he’s been informed of both inaccuracies and improper accounting practices that date back to 2008.
Last month, the district hired Kyna Koch, a former associate commissioner of finance for the Kentucky Department of Education, as the interim chief financial officer.
Since taking on the task, she said she doesn’t have confidence in the numbers she’s been asked to review.
“Federal and state requirements may not have been followed, and our accounting procedures may not have been aligned with acceptable practices,” Koch said.
Koch said inaccuracies were found in revenue collection, record-keeping, invoicing, and that spending guidelines may not have been followed.
Now she’s helping set new measures, like additional reviews, to dig deeper and provide a clearer financial picture.
“It’s clear that these practices are sometimes nuanced and not easily identified through routine financial reports that are provided to the superintendent and the board. Some of these things would not have been readily apparent based on the information typically generated,” Koch said.
Koch is also recommending that the district get a short-term loan to cover expenditures until next fall’s property taxes are collected.
Though the district is not releasing names at this time, Liggins did comment on the status of some finance administrators.
“We currently have three administrators in our financial and accounting office. Two are on paid administrative leave, and one is on medical leave,” Koch said.
Those on paid administrative leave are pending an investigation.
Liggins said while they are still awaiting finalized reports from those outside audits, they’re aiming for accuracy and transparency in their next moves.
“As we continue this work, I’m committed to following the facts wherever they may lead, and whatever they may uncover, we’re only after the truth,” Liggins said.
Liggins was asked on Thursday whether property taxes would increase for the 2026-27 school year. He said they are not currently planning to ask the board to raise property taxes any more than they typically have in years past.
On Monday, Koch will present her latest findings to the board at its regularly scheduled finance meeting.
Koch also said the district plans to have a loan proposal ready as soon as next month.
SEATTLE — The King County Regional Homelessness Authority’s governing board approved a hiring freeze on Friday and ordered a finance committee review after an audit revealed millions of dollars in unaccounted taxpayer funds.
The vote came late Friday afternoon amid growing calls to disband the agency.
RELATED: City, county councilmembers move to dissolve KCRHA after audit flags $13M unaccounted for
KCRHA CEO Kelly Kinnison told the board there are “no missing funds,” despite the audit indicating about $13 million could not be accounted for. The report also found the agency lacked a chief financial officer, had missing receipts, and allowed purchasing card use with little oversight.
Mike Nurse, a certified fraud examiner with Clark Nuber, detailed the independent audit during a presentation that lasted more than an hour. He said the agency’s structure as a “pass-through entity” for the city and county, combined with weak internal controls, contributed to financial issues, including a negative cash balance and funds that may not be recoverable.
The governing board is co-chaired by King County Executive Girmay Zahilay and Seattle Mayor Katie Wilson. Wilson attended the meeting remotely and briefly addressed the board, reiterating earlier comments that all options remain on the table.
Wilson declined to comment when approached by a reporter earlier Friday.
Zahilay led much of the discussion, and the board unanimously approved the finance committee review. Wilson’s office, represented by Deputy Mayor Brian Surratt, supported the measure, including the addition of a hiring freeze.
PREVIOUS COVERAGE: $13M missing: Seattle leaders call attention to ‘egregious’ regional homelessness audit
Just 24 hours earlier, Seattle City Councilmember Maritza Rivera and King County Councilmember Rod Dembowski announced they were sponsoring a joint resolution to eliminate the KCRHA and unwind the agency over the course of the next year.
Zahilay did not go that far when asked about the possibility on Friday.
“This is not a light switch that can be turned on and off,” he said. “We have to think through all of the ramifications. There are contracts, there is federal funding at risk, there are people’s jobs, and most importantly, we don’t want to disrupt services.”
Seattle City Councilmember Alexis Mercedes Rinck, who previously worked as a director at KCRHA, now serves on the governing board. Speaking after the meeting, she said she left the agency three years ago in part because of concerns about its operations.
“I left three years ago primarily because of the dysfunction I was witnessing within the agency,” Mercedes Rinck said.
She said her focus now is on understanding the full scope of the situation.
“My focus in this moment is ensuring that we really sort out what the truth is in this matter,” she said.
Asked whether it is time to dissolve KCRHA, she urged caution.
“It’s important that we don’t take any knee-jerk reactions when we’re talking about immediate changes,” she said.
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