In 2020, the European Union’s decision to assign over €750 billion in post-pandemic recovery funds raised great expectations across the bloc. Thanks to the NextGenerationEU and its National Recovery and Resilience Plan (NRRPs), the EU would come back a greener, more digital, more prosperous place at both national and local level.
Two years on, an unexpected challenge emerged on the horizons to derail those initial plans: rife with consequences, the February 2022 Russian invasion of Ukraine has sent already energy prices soaring, increased inflation, and generated a global food and migration crisis.
Meanwhile, cities across the bloc have started to tap into the NextGenerationEU funds to jump start a climate, digital, economic, and social transition. At the same time, municipalities responding to the new reality by hosting millions of Ukrainian refugees, face stretched budgets due to the high energy costs and two years of pandemic spending.
On a recent visit to Brussels, Dario Nardella, President of Eurocities and Mayor of Florence, talked about how recovery funds are helping his government juggle between post-pandemic reconstruction and the conflict’s ripple effect on cities.
Although EU recovery fund schemes mandate how cities should spend money, cities are allowed some flexibility. What are Florence’s priorities?
“Our focus is to build new infrastructure and take action to foster the energy, environmental and digital transition. Completing Florence’s tram system is a priority, for example; those efforts will be financed by €1.8 billion, in large part through EU funds such as the European Regional Development Fund and the Next Generation EU. Our large tram infrastructure will feature seven lines, three of which have already been completed.
In parallel, we’ll be carrying out crucial and complex urban sustainable regeneration works both in the city and in the larger Florentine metropolitan area. Our goal isn’t to build on new soil. Florence’s ‘zero volume’ urban plan forbids the construction of new edifices but, rather, encourages the restoration of existing ones. Refurbishing buildings across the city will be an enormous endeavour. At the same time, it will enable us to transform abandoned structures, improve energy efficiency, create new job opportunities, and develop innovative restoration techniques merging tradition with innovation.”
How difficult is it to restore historical buildings?
“It’s very tough; it’s the challenge within the challenge because restoration works in Florence require an extra dose of attention. Pretty much everywhere in the city construction works need to follow strict guidelines and rules devised to protect our cultural heritage sites and urban architectural landscape. Thankfully, over the years we’ve become skilful at this. For example, a few weeks ago we reopened Palazzo Portinari-Salviati, a building in Florence’s city centre dating back to the 1300s. The palazzo was built by the father of Beatrice, iconic Italian poet Dante Alighieri’s muse; during the Renaissance period it housed the Medici-Salviati family. Palazzo Portinari-Salviati features artworks by Renaissance masters like Andrea del Sarto and Bronzino. The building’s restoration – including that of frescoes ranging from the 13th to the 18th century – is considered an international example of best practice. Thanks to this refurbishment everyone can now visit and appreciate this invaluable cultural heritage site. Palazzo Portinari-Salviati‘s restoration made it possible to re-open an incredible building after decades of abandonment. The construction now also boasts a new hotel and restaurant.
Another example is Florence’s former courthouse, the San Firenze Palace. It dates to the 1600s and hosts the foundations named after Italian singer Andrea Bocelli and late movie director Franco Zeffirelli.
The refurbishing of historical buildings, meanwhile, created opportunities for restoration companies which have now become specialists in this field. The restoration of heritage sites is a challenge for many other ancient cities in Europe.”
How else are you planning to deploy recovery money?
“Taking care of people’s personal and social welfare is one of our main goals. The green and energy transition can only be successful if it will consider all social implications. The risk is that citizens will turn against the green transition because of its high social costs. This is the idea that prompted the EU to launch the Just Transition strategy. The energy crisis brought on by the war in Ukraine is already highlighting this risk; people are wondering ‘how much more do we need to pay for the transition if our energy bills already doubled? Where is Europe?’ Therefore, we need to invest in social policies and make sure that the EU green revolution is inclusive, that no one is left behind. We need to continue to pay attention to social and health issues that have been exacerbated by the pandemic and are affecting both old and young people.”
Given Florence’s relevance as a tourism and cultural attraction, how are you planning to devote recovery funds to these two sectors?
“Florence’s cultural richness implies considerable fixed costs. For example, our city centre has been a UNESCO World Heritage site since 1982. This means that every year we spend some €50 million for maintenance, cleaning, security, lighting and other services to ensure that the city centre is kept up to UNESCO-mandated standards. Some €10 million goes toward maintenance of historical buildings. Before the Covid19 pandemic, we financed Florence’s upkeep with the tourist city tax which is applied to visitors staying in town. However, during the pandemic we barely earned any income from that tax because we had very few visitors. Although tourists are coming back, we need additional resources and investments for the culture and tourism sectors, and in this case NRRPs funds are crucial. For example, we’re using NRRPs cultural complementary funding to restore Florence’s soccer stadium, which is a national monument of international relevance. The edifice is even depicted in the Italian passport pages. The so-called ‘stadio Franchi’ is the brainchild of Italian architect Pier Luigi Nervi, the same who created the Paul VI audience hall at the Vatican. This shows how recovery funds can help a city like Florence – which boasts not only Medieval and Renaissance treasures, but also 20th century landmarks – to take care of its impressive yet costly cultural heritage.”
The war in Ukraine is further complicating an already complex picture. Do you think that some NRRP funds would eventually be diverted to help Ukrainian refugees?
“I think they would be. I believe that the NRRPs scheme should give us a certain flexibility to face challenges as they come up. In the past two years, we’ve learned that everything is possible, and that the EU can face disruptive and unexpected events, from the pandemic to a conflict on our borders. We need to be able to use the NRRP funds to tackle unexpected challenges. These days, our cities are making an incredible effort to help Ukrainian refugees, from devising ad hoc services to providing housing arrangements, from offering educational services to fostering social integration. But municipalities need resources to do all of this. We recently talked to Elisa Ferreira, the European Commissioner for Cohesion and Reforms, about adopting a flexible approach to EU recovery funds to tackle emerging challenges.”
Another consequence of the war in Ukraine is that the energy crisis is raising the cost of raw materials and putting infrastructure works at risk.
“We know for sure that this is going to be the case. I have just spoken to the European Economy Commissioner, Paolo Gentiloni, about it. Rising energy and raw materials prices will very likely stand in the way of recovery goals. Construction groups complain that costs have increased by 30 per cent and even 40 per cent. Companies are worried and may not start public works until we assure them that we’ll pay for the rise in prices.”
You recently had the chance to bring this up with EU officials. What answers did you get?
“We received the green light to dip into the NRRP funds to face soaring energy costs. In Italy, this means that the national government should revise the budget for public works before they begin. But public institutions should pay that money upfront, otherwise those works may not be carried out at all. Most times, companies don’t have enough funds to pay in advance before receiving a government refund. Legislative reforms at national level will be needed to make this adjustment and we are strongly promoting them.”
While national governments and regions have contributed to defining EU recovery schemes, cities have been left out. Are you already seeing the consequences of this decision?
“Yes. I noticed that some national governments are willing to finally include cities, but I’m very worried because this is not often the case. National governments need to be more responsible. I’m referring, in particular, to countries like Hungary and Poland where cities’ involvement at national level is extremely low and where municipalities and central governments have a conflictual relationship. This isn’t reasonable. I believe that the EU should put more pressure on national governments and ask them to get cities involved in the implementation of recovery plans. I talked to the European Vice-President, Frans Timmermans, about it. One way to foster municipalities’ involvement is through pan-European programmes and projects such as the 100 Climate Neutral Cities.”
Do you think that post-pandemic recovery efforts will help national governments change their mind about cities’ importance?
“Yes. I think that the EU is becoming increasingly convinced that without cities, ambitious goals cannot be achieved. The fact that European Home Affairs Commissioner, Ylva Johannson, asked us to work together to tackle the Ukrainian humanitarian crisis is an unusual and very positive development. The European Commission is realising that municipalities offer important political and operational value. We’re also working with the European Parliament, another important partner for cities. National governments are the real challenge because they don’t always facilitate the conversation between cities and the EU.”
This article is part of a series charting local recovery efforts.
Cities face many competing challenges and are committed to learning lessons, and using the potential boost from recovery funding, to jump ahead of where they were two years ago. By using this opportunity to take a leap towards the much needed digital and environmental transitions of our time, cities want #MoreThanRecovery.”
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