MEPs gave the green light on Thursday for EU funding to help Europe's unemployed start up small businesses.

MEPs gave the green light on Thursday for EU funding to help Europe's unemployed start up small businesses. Credit will be made available to budding entrepreneurs through a “microfinance facility” funded partly from the existing Progress programme and partly from unallocated money in the EU budget.
An agreement on this issue reached between MEPs in the Employment and Social Affairs Committee and the Spanish Presidency was endorsed by the full Parliament by 511 votes to 95, with 11 abstentions.

How the deal was reached

In December, Parliament approved the creation of a “European Progress Microfinance Facility” to make it easier for people who have lost or risk losing their jobs to get credit to start up their own businesses.  MEPs agreed to make €100 million available for the facility over four years.

However, the Commission had proposed that the facility be funded from the Progress programme, a programme for employment and social solidarity, which is also targeted at the most vulnerable groups, while MEPs in the Employment and Social Affairs Committee wanted fresh money.

Under the compromise, €60 million will come from the Progress programme and €40 million from unallocated margins in the EU budget. For 2010, Parliament and Council have already agreed to release €25 million from the 2010 EU budget.

The legislation is scheduled to come into force the 20th day following its publication in the EU Official Journal.