Meeting at the invitation of German Chancellor Friedrich Merz, the leaders of the so-called ‘frugal’ Member States – Germany, Austria, Denmark, Finland, the Netherlands and Sweden – called, on Thursday 27 August, for a post-2027 European Union budget that is “modernised and reformed, both in its architecture and in the way it allocates resources” and whose mobilisation will be made conditional on respect for the EU’s fundamental values and the Rule of law.
By modernisation, the six countries mean focusing European funds on strategic priorities, citing “security and defence, competitiveness, migration and sovereignty”. In their view, the positions of the Council of the EU on the three key programmes – National and Regional Partnership Plans, the European Competitiveness Fund and the ‘Global Europe’ instrument (see EUROPE 13888/26) – provide the basis for a budgetary architecture “suited” to the challenges ahead.
“For me, the most important task for our EU is to strengthen European security and address the concerns of our populations”, Danish Prime Minister Mette Frederiksen said, as quoted by AFP.
As regards the financial amounts, the six leaders agree that the MFF 2028-2034 will increase “at a moderate pace” compared with the current situation. Nevertheless, while Member States are consolidating their public finances, “the EU budget cannot be an exception”, they stress. The initial proposal from the European Commission, concerning an overall budget of € 2,000 billion, will therefore have to be cut by “several hundred billion euros”.
“We are not stingy, but this kind of allocation proposed by the Commission simply does not correspond to our times”, Mr Merz said.
All headings of the EU budget will have to be covered by a review of the prioritisation of the policies to be financed, notably following a full assessment of financial flows. The six countries also note an “exceptionally high level” of outstanding payment commitments under the current MFF. As for expenditure linked to administration, the EU institutions will have to reorganise internally without increasing their staff numbers.
In its initial proposal, the Commission is requesting the recruitment of 2,500 additional European officials to enable it to carry out the new tasks already assigned to it.
Keen to reach a unanimous agreement in the European Council by the end of the year, the ‘frugal’ countries are also rejecting any new borrowing at European level. In their view, this is neither a solution to the budgetary challenge nor an alternative to structural reforms.
In their statement, the leaders make no reference to own resources for the EU budget, a component of the budgetary equation which European Council President António Costa currently considers the most important aspect of the discussions (see EUROPE 13924/7). During a visit to Prague on Thursday, he said that the October European Council should be used to settle the future own resources, while the Irish Presidency of the Council of the EU has been asked to present, by then, a second quantified negotiating framework.
Rejecting any budget cuts to cohesion and agriculture, Czech Prime Minister Andrej Babiš said that revenues from the ETS should continue to go back to the Member States, while an increase in certain customs duties could feed into the EU budget.
To see the statement by the six Member States: https://aeur.eu/f/n5z (Original version in French by Mathieu Bion)