Her big idea is to steer funding away from how EU money has traditionally been spent ― on agriculture and regional development ― toward new priorities such as defense and innovation.
Wednesday will fire the starting gun on over two years of fraught negotiations between governments and the European Parliament. The EU’s 27 governments have to unanimously approve the plan.
It will be a tough sell for von der Leyen. Alongside Germany’s reservations, France, the second-biggest economy, is also unwilling to increase its contributions, squeezed as it is by a soaring deficit and ballooning debt. On Tuesday, French Prime Minister François Bayrou announced a national budget to save €43.8 billion ― and immediately came under threat of being toppled by parliament.
The Commission is set to allocate €946 billion to “Europe’s social model and quality of life,” which might include regional policy and common agricultural policy which currently make up two thirds of the EU budget. If the figures are confirmed, farmers’ subsidies and payments to poorer regions ― which have been the bread and butter of the EU budget for decades ― will make up a significantly lower share of total spending in the next years to come.
If the figures seen by POLITICO are confirmed, the Commission is also set to allocate €522 billion to “competitiveness, prosperity and security,” €190 billion to “Global Europe,” which includes development aid and assistance to neighboring countries, and €107 billion to a pot called “administration” which covers the salaries of EU employees.
A dedicated off-budget fund for Ukraine will be worth €88 billion over the next seven years.
Separately, the Commission will propose three new taxes targeting electric waste, tobacco products and companies in the EU with a turnover exceeding €50 million to repay its post-Covid common debt. Repayments are expected to cost from €25 to €30 billion each year starting from 2028.
Camille Gijs contributed to this report.