EU budget: an 8 per cent cut to ‘frugal’ spending proposed. Criticism from the Netherlands and Germany

BRUSSELS – The new negotiating framework presented by the Irish Presidency of the European Union ahead of the highly contentious negotiations on the next EU budget for 2028–2034 has provoked mixed reactions amongst member states. Despite an 8 per cent cut compared with the European Commission’s proposal, there has been no shortage of criticism. The new negotiating framework will now be discussed by heads of state and government at a summit next week.

The Minister for European Affairs, Thomas Byrne, explained in Brussels that his aim in drawing up the new negotiating framework had been to accommodate the differing demands of the Member States without distorting the European Commission’s proposal, which provides for a significant increase in spending on research and defence, whilst maintaining cohesion and agriculture. “Our proposal is not the final outcome; there is still work to be done, but I hope it will help to speed up the negotiations.”

The new negotiating framework provides for an 8 per cent cut in the total amount (€141 billion) compared with the Commission’s proposal (€1,760 billion at 2025 prices). The heading for cohesion and agriculture is reduced by 3 per cent compared with the Commission’s proposal (+11 per cent compared with the current budget). The heading for competitiveness is reduced by 13 per cent (+106 per cent compared with 2021–2027). The ‘Global Europe’ heading falls by 17 per cent (+31 per cent compared with the current budget). Finally, funds allocated to administration are cut by 8.8 per cent (although they rise by 12 per cent compared with 2021–2027).

This year, more so than in the past, negotiations on the European budget will depend on own resources, in addition to national contributions. On this front, Dublin has confined itself to taking into account the proposals put forward at the time by the European Commission, despite the fact that one of these – the corporate levy – has been heavily criticised by Member States. Conversely, it has not explicitly considered the European Parliament’s proposals, including a digital tax (which Ireland does not favour).

When pressed at a press conference, Minister Byrne explained that ‘all options regarding own resources remain on the table’ and that ‘the decision lies with the leaders’. The Irish minister also wished to emphasise that by reducing the budget across the board, he had accommodated the countries most cost-conscious (Germany, the Netherlands, Finland, Austria, Sweden and Denmark), whilst maintaining a high level of funding for cohesion and agriculture (‘two sectors provided for in the Treaties themselves’).