A smaller budget on the table

The Irish presidency of the Council of the European Union proposed 8% cuts to the European Commission's proposal for the EU's multiannual budget for 2028 to 2034, bringing the total to 1.62 trillion euros. Minister for European Affairs Thomas Byrne presented the revised negotiating framework at a press conference in Brussels on 12 October, saying it saves 141 billion euros against the Commission's initial proposal while keeping a significant increase over the current multiannual financial framework. Against the Commission's proposal, which stood at 1.76 trillion euros at constant prices (1.98 trillion at current prices), the revised figure is 8% lower. Byrne said the proposal equals 1.16% of the EU's gross national income and includes new own resources to finance the budget. National allocations were also kept at the level of the proposal published in June, and the framework will serve as the basis for negotiations among member states ahead of the European Council of 15 and 16 October.

Where the cuts fall

According to Byrne, the deepest reduction falls on the Global Europe heading, cut by 17% from the Commission proposal, followed by competitiveness, prosperity and security at 13%. The administration heading is cut by 8.8%, while the heading covering economic, social and territorial cohesion, agriculture, fisheries and rural communities has the smallest reduction, at 3%. Byrne said the changes reflect priorities that member states defined for each programme, and that the ambition for new priorities in competitiveness, research, innovation, security and defence was maintained.

The European Commission deplored the significant reduction in the overall size of the budget in the Presidency proposal presented in the week of 5 October. A Commission spokesperson told the daily press briefing that large cuts risk compromising the fundamental priorities the EU has agreed collectively.

Costa's case for cohesion and energy

At the opening of the European Week of Regions and Cities in Brussels, European Council President António Costa urged the Commission to keep cohesion policies protected in the negotiation of the next budget framework. He named the housing crisis, the energy transition and a less bureaucratic system as the continent's main challenges. On energy, Costa said the current Middle East crisis and its effect on energy supplies make decarbonisation and greater independence based on renewable and nuclear sources more necessary, and that regions with more renewables already enjoy significantly lower electricity prices. He said targeted temporary measures are needed in the short term to protect families and businesses, and that the Commission has already made proposals for immediate relief. Costa cited a difference of up to 5,000 euros in annual energy costs between a poorly insulated home and a well insulated one, arguing that multiplying this saving across millions of households gives a large potential. On housing, he warned that the lack of affordable homes feeds disillusion with democratic institutions, pointing to the problem from Copenhagen to Lisbon and from Dublin to Athens. He recalled that he first placed the housing crisis on the European Council agenda in October 2025.

Regional leaders push back

Luca Menesini, president of the Party of European Socialists group in the Committee of the Regions, criticised the centralisation of European and cohesion policy at the start of the European Week of Regions.

The centralisation of European policies and of cohesion policy therefore represents a completely wrong response to the challenges ahead.

He said this would deny subsidiarity, one of the founding principles of the European Union. He warned that if the Commission obtained from the co-legislators what it proposes, the Committee of the Regions would have no choice but to use every institutional and legal instrument at its disposal.

If the European Commission were to succeed in obtaining from the co-legislators what it proposes, the European Committee of the Regions would have no choice but to use all the institutional and legal instruments at its disposal to reverse course.

Menesini added that this course could lead to the end of the European Union as it is currently known.

Timetable and Portugal's doubts

Costa said an agreement is needed by the end of this year, because any delay would affect farmers, businesses, students, researchers and innovators, and the next budget should be operational from the beginning of 2028. He told negotiators to show open-mindedness and a spirit of collective responsibility, arguing that the talks are a political choice about Europe's future and not only about numbers.

Prime Minister Luís Montenegro told the Portuguese parliament, during the debate preparing the European Council of 15 and 16 October, that Portugal is not in a position to be optimistic about the next multiannual framework. He said that the falling weight of cohesion funds and agricultural policy within the total budget, against the rapidly growing competitiveness fund, creates difficulties.

We are not in a position to be too optimistic. There are many difficulties.

Montenegro said there is no possible competitiveness without cohesion. He also said he has yet to receive an answer to a letter, sent by the Portuguese government together with the Spanish and French leaders, calling for direct and dedicated support for the outermost regions. The Portuguese government aims for an agreement by the end of the year, with another informal meeting of EU leaders in November and a Council meeting in December.