The European Commission presented on Wednesday its proposal for next Multiannual Financial Framework (MFF), the long-term EU budget for 2028 - 2034, amounting to almost €2 trillion or 1.26% of the EU's gross national income, compared to 1,13 % in the previous period.
According to the Commission, this is an ambitious budget for a stronger Europe but some EU Member States, including Germany and Belgium, have already questioned the increase in the budget and claim that it comes at the expense of their own national budgets. Interest groups such as farmer organisations fear that agriculture will receive less funding in the new MFF.
A senior EU official, talking on condition of anonymity, explained at a technical briefing on Friday that the increase is less than it appears. 0,11 % of the budget is intended for the repayment of the loans that the EU took during the COVID pandemic to finance the recovery or NextGenerationEU. The increase to 1,15 % is not massive in current prices (2025). In real terms, the MFF will amount to €1,8 trillion in 2028.
On the contrary, the Commission takes pride in presenting the largest long-term budget ever proposed. with a focus on European priorities to tackle challenges such as security, defence, competitiveness, migration, energy and climate resilience. These are not temporary but reflect systemic geopolitical and economic shifts that require a strong and forward-looking response, according to the Commission.
“Our new long-term budget will help protect European citizens, strengthen Europe's social model and make our European industry thrive,” said Commission President Ursula von der Leyen at a press conference which gathered over 10,000 on-line viewers.
“In a time of geopolitical instability, the budget will allow Europe to shape its own destiny, in line with its vision and ideals. A budget that supports peace and prosperity and promotes our values is the best tool we can have during these uncertain times.”
The size and the architecture of the new MFF are equally important, the EU official explained. The budget differs from previous ones as regards how it is designed and how the money will be spent. Indirectly admitting that the previous MFF was inflexible, cumbersome and even counterproductive, the Commission describes the new MFF as more streamlined, flexible and impactful.
This should enhance EU's capacity to deliver on core policies while addressing new and emerging priorities. Simplification is achieved by eliminating “budget silos”. The number of programmes in the next MFF will be reduced from 52 to 16 under four headings that correspond to the major areas of activity financed by the EU budget. This will make it easier to “move” funding to where it is needed.
In addition, access to EU funds for beneficiaries will be facilitated through the creation of a single portal, acting as a unique access point for all funding opportunities under different EU instruments.
Four headings and loans
The largest heading and almost half of the MFF is the National and Regional Partnership, followed by the European Competition Fund, Global Europe, and Administration. Beyond these four headings, there are a crisis instrument and a special reserve to support Ukraine.
“The new norm is crisis.” In case of a severe crisis, an extraordinary Crisis Mechanism (Catalyst Europe) will be available, offering loans up to €385 billion to Member States. The activation of the mechanism will be decided by a qualified majority of the Council and the consent of the European Parliament. The mechanism is risk-free, according to the EU official. No Member State has ever defaulted on EU loans.
To underpin the EU’s support for Ukraine, €100 billion may be mobilised over 2028-2034. This non-repayable support will be financed through common EU borrowing backed by the headroom of the EU budget. It is a financial buffer depending on the difference between EU’s revenues and actual spending a given period.
The National and Regional Partnership can be described as a merger of a number of funds into one fund. It brings together EU funds implemented by Member States and Regions under one coherent strategy, with cohesion and agricultural policy at its core. The overall objective is to deliver results that national budgets cannot achieve alone.
Ringfenced funding
While the new National and Regional Partnerships are designed to maximize flexibility, some expenditure will be ringfenced or earmarked to guarantee minimum support to core priorities. There will be a mandatory minimum amount for less developed regions, as well as a safeguard ensuring that these will receive overall at least as much funding as under the current cohesion envelope.
The Commission assures that EU farmers will continue to receive the support they need via the ringfenced Common Agriculture Policy (CAP) income support, including area-based payments, coupled income support, investments, support to small and young farmers and incentives for agri-environmental measures. Support to upgrading EU’s outdated animal welfare legislation is not earmarked.
“Taxpayers’ money should not be used to finance an agrifood system that cages animals, harms people and destroys our planet,” commented Animal welfare NGO Compassion in World Farming. The NGO called for strong support for farmers to transition to regenerative farming practices.
FOUR PAWS commented that the real test lies in ensuring that the budget allocated to CAP provides targeted funding to support farmers in transitioning towards higher-welfare and sustainable farming systems and called for strong animal welfare benchmarking in the CAP.
The new Partnership Plans should also contribute to promote equal opportunities for all across all Member States, regions and sectors. 14% of the national allocations will have to finance reforms and investments that enhance skills, fight poverty, promote social inclusion and foster rural areas. Support to the EU and National Roma Strategic Frameworks would be included here but is not mentioned in the proposal.
What about the contributions from the EU Member States to the EU budget, a point of contention in some Member States? According to the EU official, they will remain the same and stable. Besides the current main revenues, based on Gross National Income (GNI) and value-added tax, the Commission proposes five new own resources to balance the new MFF.
These new own resources are estimated to generate revenue of approximately €58.5 billion per year (in 2025 prices). The most controversial new income is the Corporate Resource for Europe (CORE), established as an annual lump-sum contribution by large companies operating and selling in the EU, with an annual net turnover above €100 million. How much it will generate has not been specified.
Rule of law and conditionality
Respect for the rule of law will be a must (a sine qua non condition) for access to EU funds, Commission President von der Leyen underlined in her presentation. If until now implementation of rule of law conditionality has been fragmented, one set of rules will apply for all funding. Conditionality will be “smart”, with possibilities to transfer suspended funds to other objectives.
In several audit reports, the European Court of Auditors (ECA) has criticized the Commission for an “assurance gap” in the Recovery and Resilience Facility (RRF) as payments are not based on actually incurred costs. Shortcomings reflect the RRF design, where progress and the satisfactory fulfilment of milestones and targets is the main condition for payment.
Is there a risk that the focus on flexibility and streamlining in the new MFF will jeopardize accountability and sound financial management?
“We have been working hand in hand with ECA to address these concerns,” the EU official told The Brussels Times. “Among others, we’ll indicate minimum requirements for control and audit of the EU funding to the Member States.”
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