Leaked multiannual EU budget sketches: Sci-fi film or a smoking gun?

Last weekend started with a blast after the (scheduled) leak of Comission’s plans to overhaul EU’s multiannual budget (MFF). The main elements, at least to those of us who swim deep in the Brussels bubble, were clear as of the end of last year.

The six-slide .pptx that our team obtained is in fact a brainstorming exercise in the run-up to the big drop of an MFF proposal (in fact a number of documents) to be presented in 2025.

Well, what’s in there?

1. Mergers and acquisitions in the constellation of EU budget instruments and programmes. A Single National Plan for each Member State (incl. Home Funds and EU envelope), a European Competitiveness Fund and strategic funding approach as regards to the Global Europe heading of the budget.

2. Money dressed-up in reform conditionalities and enabling measures - no reforms, no money. A performance-based model measuring protection of EU’s financial interests, rule of law and values. National and or regional chapters of the Plans.

3. ?EU enlargement is on the table, with its perks and pitfalls. Ukraine too, as well as the Next Generation EU repayments (as the EU borrowed funds from the international financial markets). New own resources on tap as well (less new resources = less traditional policies).

Takeaways, hypes and hopes?

1. From a budgetary management point of view, some elements of the leaks make sense -streamlining, simplification, implementation speed, faster negotiations between the Council and the European Parliament.

2. A MAJOR RISK: Failing to ensure the regional dimension, multi-level governance, partnership principle, place-based approach and, ultimately, to direct funding to the poorest regions and communities in order to accelerate their economic and social development. Regional and local authorities and the needs of regions, cities and rural areas could suffer.

3. When it comes to EU money, mergers and acquisitions of sources are opportunities for cuts, reallocation and repurposing, wound up by the lack of new own resources, and new priorities such as defence and industry support. Too much envisaged flexibility signals investment uncertainty. Allocation method could be a deal-breaker.

4. The Member States in the Council as well as the European Parliament will change significantly any Commission proposal. Whatever you see, will be outdated by the time you blink. Wait for the published regulations in the Official Journal of the EU ;)

Next steps?

The MFF regulation says that ‘Commission should present a proposal for a new multiannual financial framework before 1 July 2025’. However, I feel like seeing the proposals only in the autumn of 2025 due to the wonderland of the German election.

We will then see the draft MFF regulation, the MFF communication and its annex, as well as the traditional Inter-institutional Agreement. Staff Working Document on the spending will be out there too. Long-awaited draft sectoral regulations will be last to roll off the production line.