EU's Irish presidency wants 8% cut to proposed 2028-2034 budget plan

EU Presidency Calls for 8% Cut to Proposed 2028-2034 Budget Plan

Overview of the EU Budget Proposal and Negotiations

By Jan Strupczewski and Foo Yun Chee

Background of the Proposed Budget

BRUSSELS, Oct 10 (Reuters) - The European Union's long-term budget for the period 2028 to 2034 should be 8% lower than the European Commission's proposed €2 trillion, the Irish EU presidency said on Saturday.

This would result in a budget of €1.6 trillion, according to the Irish proposal, though it will be subject to contentious negotiations among EU countries in the coming months.

Comparison with Previous Budgets

The proposal still marks a 30% increase over the current budget, which runs from 2021 to 2027, and is certain to face stiff resistance from some countries such as Germany that want to keep a firm lid on spending.

The EU budget is the main source of financing for all of the 27-country bloc's main policies.

Key Challenges and Priorities

The Commission, the EU executive, has said the bloc will have to deal with new challenges such as spending more on defence and making Europe more competitive, while some EU countries want to retain most of the expenditure on old policies to support farming and regional development.

Details of the Irish Compromise Proposal

"The Negotiating Box provides savings of 8%, or €141 billion, on the Commission's original proposal," said Ireland, current holder of the EU's six-month rotating presidency, referring to its compromise proposal.

Ireland put the Commission's original €2 trillion figure at €1.76 trillion based on 2025 prices, which resulted in an 8% reduction.

Sectoral Spending Adjustments

The proposal sets out a 3% cut in spending on regional development, agriculture and fisheries spending from the Commission's own figures, and a 13% reduction in spending on competitiveness, prosperity and security.

It foresees €55 billion in new financing options derived from customs duties and selling CO2 emissions permits to companies, among other sources.

Next Steps and Reactions from Member States

EU leaders will discuss the Irish proposal in Brussels on October 15 to 16. The ⁠EU budget, which is known as the Multiannual Financial Framework, needs to be agreed by all 27 member states.

Division Among EU Countries

While more frugally-minded countries such as Germany, the Netherlands and the Nordic countries have called for budget cutbacks, others including Spain, Italy and Poland are keen to protect expenditure.

(Reporting by Foo Yun Chee and Jan Strupczewski, additional reporting by Andrew Gray;Editing by Tomasz Janowski and Gareth Jones)