Von der Leyen defends European budget against calls for cuts

European Commission President Ursula von der Leyen called on the European Parliament to avoid major cuts to the European Union’s next multiannual budget. Addressing the European Parliament, she defended the proposal for the 2028–2034 period, which is equivalent to 1.26% of the EU’s gross national income, and warned that reducing it could put priorities agreed by the member states at risk.

The debate pits governments that consider the proposal excessive against others calling for European funding to be maintained or increased. Negotiations are ongoing: the positions expressed are political proposals and demands, not an approved budget.

Two positions on the size and priorities of the budget

Germany, Finland, Sweden, Denmark, the Netherlands and Austria called for the financial framework, which is around two trillion euros, to be reduced. In a letter to the rotating presidency of the Council, held by Ireland, they pointed to the fiscal difficulties facing member states and described the Commission’s proposal as unrealistic.

By contrast, Spain, Italy, Croatia, Portugal, Greece and other countries called for funding for the common agricultural policy (CAP) and cohesion funds to be maintained. For these governments, the challenge is to fund new priorities—such as defence, competitiveness and innovation—while continuing to support traditional EU policies.

Von der Leyen argued that the European budget must address these different objectives. The areas she mentioned included defence and security, artificial intelligence, energy infrastructure, research, training and crisis management, as well as food security and cohesion between regions and member states.

Funding, another point of disagreement

The Commission President argued in favour of seeking new own resources—that is, revenue that goes directly to the EU budget—instead of relying solely on national contributions. Sources cited in coverage include revenue from the emissions trading system, the carbon border adjustment mechanism and excise duties on tobacco. The Commission estimates that these sources could bring in 58.5 billion euros; governments in favour of reducing the framework consider that this would not be enough to prevent higher national contributions.

Other revenue options have also been proposed, but they remain proposals. Negotiations will have to settle both the total size of the budget and how it is divided among priorities, as well as how it is financed.

Energy: joint purchasing and targeted support

In the same speech, Von der Leyen linked the budget debate to pressure from energy prices and dependence on fossil fuel imports. She supported exploring joint purchasing through demand aggregation and announced a strategic dialogue with refineries to address costs and secure supplies, including for defence.

The President cited energy vouchers for low-income households in France and Romania as examples of immediate support. By contrast, she expressed reservations about broad-based aid, arguing that it could increase demand and costs. She also announced that the Commission would present measures to double electrification targets by 2040; according to Von der Leyen, this could reduce fossil fuel imports by 260 billion euros a year. This is an announced target, not an outcome that has already been achieved.

Negotiations continue

The next EU leaders’ summit in Brussels was scheduled as a further opportunity to discuss the financial framework. The process will have to reconcile calls for spending restraint with demands to protect budget lines and fund new priorities. For now, neither the budget’s final size nor its sources of revenue have been decided.