The Heads of State and Government of the European Union have agreed this Friday to accelerate work on new own resources to feed the next Multiannual Financial Framework (MFF) for the period 2028-2034. This is one of the most sensitive points of a negotiation that leaders want to conclude before the end of the year, in order to ensure that the new European programs start on January 1, 2028.
As EU sources indicated at the end of the debate held in the European Council, the Twenty-Seven note progress in several blocks of the budgetary negotiation, such as the competitiveness instrument, the external action pillar, or certain elements of the new architecture of the accounts. Nevertheless, they admit that the "financial equation" continues to be the thorniest issue and the one that will determine whether or not a political compromise can be reached in the coming months.
"The total volume of the budget remains under discussion, although there is consensus that it must be up to the ambitions of the European Union. This will also involve finding an adequate level of resources to finance the EU's priorities. Therefore, new own resources will be a very important part of this financial equation," they added.
Along these lines, leaders agree that the future financial framework will have to respond to the Union's new ambitions in security, defense, competitiveness, and in the ecological and digital transition. However, the overall size of the budget continues to divide Member States.
So far, capitals that demand a more contained budget, such as Germany, the Netherlands, Sweden, or Austria, which advocate limiting spending and reject resorting to more common debt, and the group of so-called 'Friends of Cohesion' —including Spain, Italy, Portugal, Poland, or Romania—, who push for more expansive accounts and warn that the EU's new priorities cannot be financed by cutting agricultural and cohesion policies, remain opposed.
"There is agreement that the budget will have to correspond to the Union's ambitions," say the same sources, who acknowledge, however, that this will require setting "the adequate level of resources" to cover European priorities.
For this reason, new own resources are consolidated as a central element of the negotiation. The initiatives already put forward by the European Commission will continue to be the basis for discussion, although leaders also show themselves willing to continue analyzing other ideas defended by the European Parliament.
In this context, the Heads of State and Government have asked the next Irish Presidency of the Council of the EU, which will replace Cyprus in the second half of the year, to place work on new sources of revenue at the forefront and to present an "ambitious and balanced" proposal before the European Council in October, accompanied by a new version of the negotiation document that will serve as support for the final phase of the talks.
The goal remains to close an agreement before the end of 2026, a timeline that the bloc's countries consider key to avoiding delays in the entry into force of the next budget and to prevent the electoral cycle planned in several member states in 2027 from further complicating already particularly complex talks.
New sources of funding for the European budget
Among the revenue streams proposed by Brussels are resources linked to the Union's climate objectives, such as the European emissions trading scheme (ETS) and the Carbon Border Adjustment Mechanism (CBAM). In addition, there are new contributions based on uncollected electronic waste, a corporate resource for Europe, and another associated with excise duties on tobacco.
The Commission argues that this package would allow for the diversification of common budget funding sources, keep national contributions stable despite the increase in investment needs, and help repay the debt issued to finance the 'NextGenerationEU' recovery fund.
In the proposal presented last summer, the Community Executive argues that "an ambitious budget focused on European priorities must be based on a more modern and more European revenue system," capable of supporting the Union's new priorities, from competitiveness and defense to the ecological transition and future enlargement.