The European Commission has unveiled a proposal for the largest EU budget in the Union’s history, setting the stage for intense negotiations ahead of the 2028-2034 financial period. The proposed long-term financial framework totals 2,000 billion euros, a substantial increase from the current budget of approximately 1,200 billion euros.
New priorities and funding strategy
Commission President Ursula von der Leyen described the proposed budget as a “budget for a new era,” reflecting Europe’s ambition to strengthen its strategic autonomy and meet global challenges. A significant share of the funding is earmarked for defence, innovation, border control, and climate policies.
To finance the expanded budget, the Commission is not proposing an increase in national contributions. Instead, it suggests the introduction of five new revenue streams, including levies on tobacco, electronic waste, large companies, CO2-intensive products, and the EU’s emissions trading system.
A notable portion of the budget is reserved for repaying the common debt contracted under the Next Generation EU programme, which was established to support recovery after the COVID-19 pandemic. The Commission estimates that the overall envelope will correspond to 1.26% of the EU’s gross national income (GNI), up from 1.13% in the current period.
Allocation of funds: competitiveness, defence, and Ukraine
According to the Commission, the budget proposal includes:
- 410 billion euros for a new European competitiveness fund, aimed at boosting the EU’s position in global markets, particularly against the US and China;
- 300 billion euros in agricultural subsidies, which represents a decline in relative terms;
- 218 billion euros to support less developed regions;
- 131 billion euros for defence and aerospace, marking a fivefold increase over the current allocation;
- 100 billion euros in aid to Ukraine;
- A threefold increase in funding for migration and border control.
While traditional budget items such as agriculture and cohesion funds remain significant, the proposed shift in allocations underscores a strategic reorientation toward geopolitical resilience and technological leadership.
Mixed reactions across Europe
The proposal has sparked divergent reactions among EU institutions, member states, and interest groups.
In Brussels, both the European People’s Party (EPP) and the Socialists and Democrats (S&D) criticised the plan as insufficiently ambitious, arguing that it fails to fully address Europe’s systemic challenges. Meanwhile, Germany, the Union’s largest economy, rejected the proposal as excessive. A government spokesperson described the increase as “unacceptable” in light of national fiscal constraints.
Farmers’ associations, including Copa-Cogeca, denounced the proposed reallocation of resources as a threat to agricultural support. They staged protests in Brussels, calling the announcement a “black Wednesday for European agriculture.”
Within the European Parliament, views remain divided. Green and progressive groups welcomed the increased funding for climate action, while others voiced concern about the reliance on controversial new taxes and the inclusion of debt repayment in the common budget.
The road ahead
Before the budget can take effect, it must receive unanimous approval from all 27 member states, as well as consent from the European Parliament. The negotiation process is expected to be long and politically charged, with talks likely extending well into 2027.
Commission President von der Leyen emphasised the need for unity and responsibility:
“We must enter this debate with an open mind and a sense of collective responsibility.” The upcoming months will test the EU’s ability to reconcile divergent priorities under a single financial framework.
