Europe is entering its next seven-year budget cycle in a world very different from the one in which the current budget was designed. The proposed 2028-2034 Multiannual Financial Framework (MFF) is almost €2 trillion, 1.26% of EU gross national income.
Yet it is expected to respond to war on Europe’s borders, support Ukraine and future enlargement, strengthen competitiveness, invest in AI and energy, manage migration and maintain long-standing priorities such as agriculture and cohesion.
With so much competing for attention, what should the EU budget prioritise - and where does it make most sense to act together rather than nationally?
For liberals, several issues have dominated in ongoing negotiations:
Defence: Russia’s war against Ukraine has changed the meaning of European security. Can Europe afford to approach security as 27 separate national responsibilities when the threats increasingly cross borders, from cyberattacks and disinformation to military threats and attacks on critical infrastructure?
Competitiveness: If Europe wants to compete with the US and China, can it afford such a fragmented approach to investment, AI and energy? The choices Europe makes will determine whether the next generation of technologies, businesses and jobs are created in Europe or elsewhere. The proposed European Competitiveness Fund seeks to pool investment and turn the scale of the single market into an advantage.
Enlargement: Bringing Ukraine and other candidates into the EU will require major investment in infrastructure. But enlargement is also about Europe’s future borders and security. Supporting Ukraine and preparing for its eventual membership are more than foreign-policy commitments, they are investments in a European security order.
National priorities: The proposed National and Regional Partnership Plans would give member states more flexibility to decide how EU funds are used. That could make spending simpler and more responsive. But too much national control could renationalise the EU budget and weaken common European priorities.
At the helm of the Council Presidency, Ireland must now help turn these competing priorities into a compromise, with the aim of reaching agreement among Member States by the end of 2026, so the legislation can be adopted in 2027 and the new budget can begin in 2028.
There is no budget large enough to do everything. The real choice is what Europe is prepared to prioritise and what it is prepared to leave to Member States.
Liberals are pushing for a European budget that prioritises strategic investment. Europe must champion cutting-edge research and enhanced its strategic autonomy going forward to unlock a more competitive and self-reliant continent on the global stage.