Germany rejects new EU budget cut plan
Germany and five other EU countries have opposed the new draft of the EU's long-term budget for 2028-2034, even though it provides for a spending reduction of €159 billion. Berlin considers the proposed savings insufficient and demands a significantly deeper revision of the financial plan.
This is reported by Agence Europe, citing the new budget proposal of Ireland, which holds the presidency of the Council of the EU, and the reaction of European governments.
The document presented on October 10 provides for a reduction of the upcoming seven-year EU budget from €1.985 trillion to €1.825 trillion in 2025 prices. Compared to the initial proposal of the European Commission of July 2025, the spending is proposed to be reduced by about 8%.
The largest cut concerns funding for the competitiveness of the European economy, innovation, and defense. The total spending on this heading is proposed to be reduced by €75 billion – to €515 billion.
In particular, funding for the European Competitiveness Fund could decrease from €409 billion to €362 billion. For defense industry, security, and space programs, it is proposed to allocate €113 billion instead of the initial €130 billion. At the same time, the budget of the Horizon Europe research program could decrease from €175 billion to €158 billion.
Another area of savings is EU external policy. Funding for the Global Europe program, which covers international cooperation, development assistance, and support for partner countries, is proposed to be reduced by €38 billion – to €177 billion.
At the same time, the funds earmarked for Ukraine's reconstruction are preserved in the new draft. According to Agence Europe, the Irish presidency also left without cuts the separately reserved €25 billion for humanitarian aid.
In contrast, funding for agriculture and regional development of the EU was hardly touched. Spending on these traditional areas of the European budget is reduced by about 3%. They are protected by a significant group of states that receive a substantial share of the respective funds.
However, the proposed compromise did not satisfy the biggest advocates of budget savings. Germany's Chancellor Friedrich Merz stated that the size of the new financial plan cannot be an acceptable basis for negotiations.
Berlin's position was supported by the Netherlands, Sweden, Denmark, Finland, and Austria. Together these six states provide nearly 40% of the EU budget funding and insist on cuts of several hundred billion euros.
At the same time, contradictions concern not only the overall amount of funds. Countries demanding savings are unhappy that the largest cuts fall on defense, technologies, and competitiveness. They consider these directions a priority for the future of the EU.
A different position is held by states interested in maintaining large spending on agriculture and regional support. In particular, Poland positively assessed the preservation of its funding, although at the same time it advocates for a bigger overall EU budget.
Criticism also came from the European Commission and the European Parliament. In Brussels, there is concern about cutting spending on new strategic priorities and reducing financial reserves for responding to emergencies. European Parliament representatives have already warned that they may not support the current version of the document.
The next round of negotiations is scheduled for October 13 at a meeting of the Council of the EU on General Affairs. After that, the budget will be discussed by heads of state at the EU summit on October 15-16.
The Irish presidency seeks to reach a political agreement by the end of 2026 to ensure timely adoption of financial programs for the next seven-year period. However, due to disagreements among governments, this timetable has come into question.
The final budget for 2028-2034 has not yet been approved. Its adoption requires the unanimous agreement of all 27 EU states and the approval of the European Parliament.
Sources: Agence Europe, Agence Europe, Council of the European Union