Ireland’s Council presidency has trimmed the EU budget for 2028–2034 by about €141 billion against the Commission’s draft. Chancellor Friedrich Merz still says it is “no basis for an agreement”. The numbers explain why. (As of 15 October; EU leaders debate the plan openly for the first time at the Brussels summit on 15–16 October.)
According to the Council’s negotiating note of 10 October, the ceiling would be €1.622 trillion in 2025 prices, against €1.763 trillion in the Commission’s July 2025 proposal. That is eight per cent less in real terms, or roughly €1.826 trillion in current prices. Compared with the current 2021–2027 budget it is still about 30 per cent higher, Brussels Signal reports. In September, during a visit by European Council President António Costa, Merz called the original rise of up to 60 per cent “simply unaffordable” and demanded cuts of “several hundred billion euros”.
The smallest cuts fall where Berlin wants to save
The dispute is less about the total than about its distribution. The block for cohesion, agriculture and fisheries falls by only about three per cent, to €914 billion. Competitiveness, research and security lose around 13 per cent (€456 billion), external action (“Global Europe”) 17 per cent (€157 billion) and administration 8.8 per cent (€95 billion). The areas Merz calls priorities for the future would shrink most, while the traditional funds are largely spared. Ireland’s Europe minister Thomas Byrne said, according to dpa, that a “very large majority” of member states do not want further cuts to farm and cohesion funding, including some net payers.
The European Parliament also rejects the draft: “Cuts that weaken Europe will not get our consent”, its lead MEPs said. Parliament must approve the framework, and had itself asked for about ten per cent more than the Commission proposed.
For Germany a lot of money is at stake: in 2025 it paid about €34.1 billion into the EU budget, received €12.2 billion back and so contributed €21.8 billion net. Merz says his group of “frugal” states (Germany, the Netherlands, Sweden, Denmark, Austria, Finland) funds about 40 per cent of the budget and 70 per cent of member states’ bilateral aid to Ukraine.
And Ukraine?
Ukraine support sits outside the ceilings in the draft: a “Ukraine Reserve” of up to €88.9 billion for 2028–2034, including guarantees of up to €42.7 billion. Cutting the budget therefore does not automatically cut this reserve. How it is funded is open, because own resources are unresolved. New revenue of about €55 billion a year is meant to come from customs duties, emissions trading and a levy on large companies; a digital levy, gambling levy and crypto charge are missing.
Our assessment: a deal by the end of the year is unlikely, and dpa also considers it hard to reach. The most probable next step is a revised package from Costa after the summit, with farm and cohesion money shrinking slightly and the future-oriented headings growing slightly. If Merz holds his line, 2027 becomes a negotiating year, and a compromise on own resources looks like the likeliest lever. This is a forecast with limited certainty, not information from the talks.
Earlier coverage: EU summit: Ukraine cluster open, budget in dispute.
Sources: Council of the EU (Negotiating Box, 10 Oct), German government, ZDFheute, Brussels Signal, dpa
