Deep divisions threaten approval of the EU’s 2028–2034 budget

Yesterday 21:45

By: Azzat Manal

Deep divisions threaten approval of the EU’s 2028–2034 budget

Negotiations over the European Union’s next long-term budget are facing significant obstacles, with disagreements over spending levels, funding sources and financial priorities raising doubts about whether the proposed plan can secure approval. German Chancellor Friedrich Merz and European Parliament President Roberta Metsola have both warned that the divisions are serious, while several European leaders have played down the prospect of an immediate breakthrough.

Speaking ahead of a European Council summit in Brussels, Merz described the negotiations as extremely difficult and said he did not expect meaningful progress over the coming days. He argued that the European Commission’s proposed budget was too ambitious, with its overall size reportedly around 50% higher than the current financial framework.

Merz maintained that member states could not reasonably be expected to shoulder contributions on the scale implied by the proposal. He therefore called for substantial reductions in overall spending, reflecting concerns among some governments about national budgets and the financial burden of funding common European priorities.

The German chancellor welcomed a compromise proposal presented by Ireland, which holds the rotating presidency of the Council of the European Union. The plan reportedly envisages cutting expenditure by €160 billion at current prices. However, Merz said the proposed reductions did not go far enough and called for further savings.

Metsola has also highlighted the scale of the disagreements, describing divisions among member states over the next multiannual financial framework as unprecedented. She warned that proposed spending cuts could complicate the European Parliament’s approval of the final agreement, particularly if they affect funding for innovation, defence and competitiveness.

Another major point of contention is the EU’s future revenue system. Discussions on creating additional sources of income for the bloc have made limited progress, raising questions about how the Union would finance its expanding responsibilities without placing excessive pressure on national contributions. Metsola argued that the EU cannot continue taking on new tasks while its available resources are reduced.

She expressed hope that member states could reach an agreement before the end of 2026, while stressing that the resulting financial framework would still require parliamentary approval. Luxembourg Prime Minister Luc Frieden also played down expectations of a substantial breakthrough at the current leaders’ summit.

The European Commission has proposed a long-term budget worth approximately €2 trillion for the 2028–2034 period. The plan is intended to address a range of priorities, including strengthening European defence capabilities, improving economic competitiveness, supporting innovation and maintaining assistance for Ukraine. However, the scale of the proposed spending, the distribution of funds among policy areas and the introduction of new revenue sources have become central points of disagreement.

The negotiations are particularly sensitive because the EU’s long-term budget determines spending priorities over seven years and influences programmes ranging from regional development and agriculture to research, security and external assistance. Reducing the overall envelope could require difficult choices about which programmes receive funding and which priorities are scaled back.

Adopting the multiannual financial framework requires unanimous agreement among EU member states, followed by the consent of the European Parliament. This dual approval process gives governments and lawmakers significant influence over the final outcome and makes compromise essential. With positions still far apart, the negotiations are expected to remain a major test of the bloc’s ability to reconcile national budgetary concerns with its shared strategic ambitions.