The European Parliament votes to raise the EU’s long-term budget above €2 trillion

Ane Barcos The European Parliament on Tuesday established its negotiating position on the next multiannual financial framework for the period 2028-2034, with a proposal that calls for an increase of nearly 10% compared to the plan of almost €1.8 trillion presented in July by the European Commission. The European Parliament's provisional report, approved on Tuesday with 370 votes in favor, 201 against, and 84 abstentions, proposes a 10% increase over the Commission's initial proposal, distributed among the main spending areas linked to the Union's priorities, excluding administration and agencies. Parliament is thus proposing a total budget framework of €1.78 trillion at constant 2025 prices, equivalent to €2.01 trillion at current prices. The stated objective is to finance the Union's political priorities and strategic objectives. The European Parliament proposes that EU spending reach 1.27% of the EU's gross national income and that the debt service cost of the NextGenerationEU fund, estimated at 0.11% of gross national income, be excluded from budgetary limits. The adopted position maintains that the multiannual budget must retain an investment function focused on common policies and support for citizens, regions, businesses, and small and medium-sized enterprises (SMEs). It also rejects the renationalization of spending and questions a model based on individual plans for each Member State, arguing that it could reduce transparency and weaken common policies. The Parliament also supports the creation of new own resources to finance the budget and address the NextGenerationEU debt. Within this framework, it proposes new revenue sources worth approximately €60 billion annually, including taxes on digital services, online gambling, an expansion of the carbon border adjustment mechanism, and levies on capital gains from crypto assets. The co-rapporteur for the Progressive Alliance of Socialists and Democrats, Carla Tavares, stated that “ambition without resources is empty” and noted that Parliament has adopted “a firm stance” on the upcoming budget, “balancing new and traditional priorities with a moderate increase and new own resources.” Parliament is thus calling for specific funding for the Common Agricultural Policy, Fisheries Policy, cohesion, the European Social Fund, home affairs, and outermost regions. It is also calling for the participation of regional and local authorities in the planning and implementation of programs. The Parliament also supports the planned budget increase for competitiveness, defense, innovation, digital transition, green transition, infrastructure, health, education, and culture. Furthermore, it is requesting more resources for instruments such as Horizon Europe, Erasmus+, and the Civil Protection Mechanism, as well as specific funding lines for EU4Health and LIFE. MEPs support an increase in resources for external action, although they consider the figure proposed by the Commission insufficient. Therefore, they are demanding more funding for enlargement, development, support for Ukraine, multilateral cooperation, and humanitarian aid. The vote now paves the way for the start of negotiations between the Parliament and the Council. The report's co-rapporteur, Siegfried Mureșan, urged the European Council to "step up, promote our proposals, and approve a sound and timely budget," while expressing his willingness to collaborate. The leaders of the so-called frugal states have expressed their opposition to expanding the EU budget. German Chancellor Friedrich Merz stated during the informal European Council meeting held in Cyprus that "Europe has to make do with the money we have" and maintained that, from Germany's perspective, further European borrowing or the issuance of common bonds on the capital markets is not an option.

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