The EU’s next seven-year budget is moving from institutional design into harder political bargaining. For governments and investors, the key question is increasingly not simply how much Europe will spend, but which priorities survive the negotiation, where control over funding ultimately sits, and what conditions will shape access to it.
The European Commission has proposed a Multiannual Financial Framework (MFF) of almost €2 trillion for 2028–2034, equivalent to around 1.26% of EU gross national income. But the proposal is also a significant redesign of how EU money would be spent, with fewer and larger programs, greater flexibility, and a closer link between funding, reforms and strategic priorities. The Commission’s proposal therefore matters as much for its architecture as for its headline size.
At its center are proposed National and Regional Partnership Plans (NRPPs). Each Member State would prepare one comprehensive plan bringing together funding currently delivered through separate programs covering cohesion, agriculture, fisheries, migration and security, among others. In June, the Council adopted a partial negotiating position supporting the model while increasing flexibility for Member States and strengthening the role of regional and local authorities. Financial and horizontal questions remain part of the wider MFF negotiation.
Alongside this, the proposed European Competitiveness Fund (ECF) would bring 14 existing programs under one framework and target areas including digital technologies, clean industry, health and biotechnology, defense and space. The Council has also adopted only a partial negotiating mandate, meaning its final financial envelope remains open. This is important for investors: the negotiation will determine not only how much capital is available, but which strategic sectors receive priority and how public funding is expected to mobilize private investment.
The institutional argument is increasingly about control as well as allocation. A more integrated national planning model would give Member States an important role in translating EU priorities into domestic investment programs. The European Parliament, however, has explicitly opposed what it sees as a risk of re-nationalising the EU budget and has called for an MFF equivalent to 1.27% of EU GNI, with NextGenerationEU debt servicing of around 0.11% of GNI outside the spending ceilings.
At the same time, pressure on the overall envelope is growing. On 27 August, Denmark, Germany, the Netherlands, Austria, Finland and Sweden jointly called for the Commission proposal to be reduced by several hundred billion euros, arguing that all spending headings should contribute while resources are concentrated on priorities including competitiveness, security and defense, migration and sovereignty. If the headline budget comes down, the politically important signal will therefore be what is protected.
The revenue side should also be watched. The Commission has proposed five new own resources linked to emissions trading, CBAM, non-collected e-waste, tobacco excise and a new corporate contribution applying to companies with annual EU turnover of at least €100 million. The Own Resources Decision ultimately requires unanimity and approval by all Member States according to their constitutional requirements, making the financing of the budget a political negotiation in its own right.
The Irish Presidency is now working to narrow the remaining differences. Following informal discussions in Dublin on September 3 and 4, Presidency Minister Thomas Byrne stressed the need for compromise and consensus as Member States debated the balance of expenditure. The next formal milestones include a further MFF policy debate at the September 22, General Affairs Council and the October 15 to 16 European Council, with the aim of reaching a political agreement in 2026 and completing the necessary legislation during 2027.
Conclusion
The MFF should therefore be read less as a seven-year spending announcement and more as an early map of Europe’s future investment priorities and decision-making architecture. The most important signals over the coming months will be which sectors and programs are protected during the compromise, how much discretion Member States ultimately receive, and what conditions become attached to access to EU funding.
For investors and companies, that also creates an engagement question. By the time individual funding opportunities emerge, many of the decisions determining which investments are prioritized, how national plans are structured and what qualifies for support will already have been shaped. Understanding where those decisions are being made — in Brussels, national capitals and increasingly between the two — will matter as much as following the final headline number.
