ECONOMIE
The 2028–2034 EU budget — what gets cut, where the new grants are and what Romania risks
The 2028–2034 EU budget grows only on paper, so defence, research and Ukraine get new money mainly at the expense of agriculture and cohesion, and money arrives only after results.
The analysis follows five threads: what the Commission proposed and what changes from the 2021–2027 budget, which areas lose, where the new grants are, where the talks stand after the October summit, and what all this means for Romania. At the end we set out the traps we see in the numbers, three scenarios for the size of the deal, the likely timetable and the table of predictions.
What the Commission proposed
On 16 July 2025, the European Commission proposed a multiannual financial framework of 1,763 billion euros in 2025 prices, or 1.26% of the Union's gross national income. In current prices, with seven years of estimated inflation, the sum approaches 2,000 billion. It includes, however, 149.3 billion for repaying the joint pandemic loan, NextGenerationEU, which starts in 2028, according to the European Parliament's research service.
Without the repayment, actual spending comes to about 1.15% of gross national income, against about 1.14% in the current budget, according to the European Parliament rapporteur Siegfried Mureșan. The large headline figure therefore hides a budget that is almost frozen as a share of the economy. What really changes is the architecture, the priorities and the payment rule.
The architecture is radically simplified. The budget has four headings instead of seven and 16 programmes instead of 52. Fourteen funds, including the common agricultural policy, the cohesion funds, the fisheries fund and the migration funds, are gathered into a single national and regional partnership plan for each state, on the model of the recovery plans. The second pillar is a European Competitiveness Fund, which brings together research, industry, digital, health and defence.
What changes from the 2021–2027 budget
| Area | 2021–2027 | Proposal for 2028–2034 | Direction |
|---|---|---|---|
| Agriculture (farmers' income support) | €387.8bn for the whole agricultural policy | at least €293.7bn ring-fenced for income support, the rest negotiated in the national plan | down |
| Agriculture and cohesion, as a share of the budget | almost 60% | about 44% | down |
| Transition and more developed regions | their own cohesion allocations | no dedicated allocation; a minimum of €218bn only for less developed regions | down |
| Research (Horizon Europe, FP10) | about €95.5bn | €175bn | almost doubles |
| Defence and space | little money, in separate programmes | €131bn, in the Competitiveness Fund | about five times more |
| Migration, borders, internal security | separate, smaller funds | €34bn | about three times more |
| External action (Global Europe) | the current neighbourhood and development instrument | €200bn, of which up to €100bn for Ukraine | +38% in real terms |
| Erasmus+ | about €26bn | €40.8bn; Parliament asks for €47.39bn | up |
Sources: the Commission's page on the 2028–2034 budget, the Commission's page on agricultural policy after 2027, the European Parliament briefing cited above and Bruegel. The figures in the proposal column are in current prices. In 2025 prices, research has 154.9 billion, the Competitiveness Fund 362.3 billion and the main external action instrument 176.8 billion, according to the European Parliament. For defence and migration, we treat the figures as orders of magnitude.
Which areas lose money
Agriculture. The Commission ring-fences at least 293.7 billion euros for the income support of farmers and fishers, against 387.8 billion for the whole agricultural policy in 2021–2027. The comparison is not perfect, because rural development can get extra money from the national plan. That is exactly the problem for farmers: investment money is no longer guaranteed, but competes with roads, hospitals and schools for the same envelope. Later, the Commission also proposed a target of at least 10% of the envelope for rural areas, on top of income support.
Cohesion for richer regions. Less developed regions get a guarantee of at least 218 billion euros. Transition and more developed regions lose their own allocation, and their role depends on how the government writes its plan. For Romania, this concerns first of all the Bucharest–Ilfov region.
Flexibility and crises. Reserves for disasters and unforeseen crises were among the first things cut in the negotiation. Ursula von der Leyen said after the October summit that the negotiating proposal halves the flexibilities and fixes 99.5% of the budget for ten years, which she called "a straitjacket", according to Calea Europeană.
The new headings, under negotiation. Net contributor states want cuts, and these fall mostly on what is new. The Irish compromise took 75 billion from the Competitiveness Fund, 38 billion from external action and 10 billion from administration, leaving agriculture and cohesion almost untouched, according to EUobserver. Eastern states protested against the 13% cut to the competitiveness and security heading, which also funds defence.
Where the new grants are
Most of the new money does not come as envelopes for each country. It is won in European competition, through calls managed from Brussels. This is the most important change for Romanian companies, universities and town halls.
- The European Competitiveness Fund has four windows: the clean transition and industrial decarbonisation, digital, health and biotechnology, defence and space. The Commission proposed it at about 409 billion euros in current prices, research included.
- Research (FP10) rises to 175 billion in current prices. Romania has so far drawn under 1% of the money of the current Horizon Europe programme, according to President Nicușor Dan, quoted by Edupedu.
- Defence and military mobility. The defence and space window has 131 billion, and the money for military mobility in the Connecting Europe Facility is multiplied tenfold. This covers the roads, bridges and railways that must be able to carry military equipment to the eastern flank.
- Education and young people. Erasmus+ rises to 40.8 billion, and the European Parliament asks for 47.39 billion, according to Mediafax.
- The Social Climate Fund moves into the national plan and brings Romania 4.6 billion euros for households hit by the carbon price on heating and transport.
Separately from the budget, the Commission proposed a crisis loan mechanism of up to almost 400 billion euros. These are loans, not grants, like the 16.68 billion euros Romania signed in May 2026 through the SAFE defence programme, according to Agerpres.
The directions: how the way the EU gives money changes
Payment for results. National plans receive money when the state meets its milestones and targets, as with the recovery plans, not when it settles invoices. The plans must also respond to the European Semester's country recommendations, so reforms become a condition of payment. The 2020 rule-of-law regulation stays in force for the whole budget.
New own resources. So that national contributions do not rise, the Commission proposed five new resources, with average annual revenue estimated as follows: a share of the carbon market, about 9.6 billion; the carbon border adjustment mechanism, about 1.4 billion; uncollected electronic waste, about 15 billion; tobacco excise, about 11.2 billion; a contribution from large companies, about 6.8 billion. Parliament also proposed levies on crypto-assets, online gambling and large digital companies.
More power in Brussels and in the government. One plan per country means a single national negotiator and fewer funds with their own rules. Regions, local authorities and farmers become consulted partners, not holders of ring-fenced money.
Where the talks stand
The budget requires the unanimity of the 27 states and the consent of the European Parliament. The figures have come down step by step. The Cypriot presidency proposed a total of 1,730 billion euros on 11 June 2026, and the Irish one, on 10 October, 1,620 billion, both in 2025 prices. Without debt repayment, the Irish figure means 1.02% of gross national income by the European Parliament's calculation and 1.05% by the presidency's, below the level of the current budget in both cases.
Two camps have formed. Germany, the Netherlands, Austria, Sweden, Denmark and Finland, the "frugal" states, demand cuts of "hundreds of billions" and reject any new joint borrowing. Swedish Prime Minister Ulf Kristersson said the proposal would increase his country's net contribution by almost 60%. On 26 October, Austrian Chancellor Christian Stocker became the first leader to threaten a veto, saying Austria has "a red line", according to Digi24.
On the other side, 17 states, the "Friends of Cohesion", including Romania, Italy, Spain and Poland, demand that agriculture and cohesion stay at the current level. Their letter of 2 October, coordinated by Nicușor Dan and Giorgia Meloni, also asks for the repayment of the pandemic debt, estimated at about 25 billion euros a year, to be postponed and for the contribution rebates granted to richer states to be scrapped, according to Spotmedia.
The European Parliament voted its position on 28 April 2026, with 370 votes in favour, 201 against and 84 abstentions: 1.27% of gross national income without repayment, with money ring-fenced separately for agriculture and cohesion. Siegfried Mureșan, one of the two rapporteurs, said that the governing parties of the 27 states hold only 270 MEPs, while the budget needs 361 votes, and that Parliament would reject a budget that cuts agriculture and cohesion.
The 15–16 October summit ended without a deal. António Costa, the President of the European Council, took over the negotiation and called an extraordinary summit on 26–27 November, aiming for a deal by the end of the year. Weighing on the talks are also Ukraine's request for another 70 billion euros for next year and France's presidential election in April 2027.
What it means for Romania
The Commission proposed for Romania a national and regional plan of 60.2 billion euros in current prices: 54.6 billion as the general allocation for cohesion and agriculture, 4.6 billion from the Social Climate Fund and 1 billion for migration and internal security, according to the Commission's allocation table. As an order of magnitude, 2021–2027 cohesion brought about 31 billion in European money, and the 2023–2027 agricultural strategic plan about 15.8 billion.
The arithmetic shows a nominal increase of about 17% in the general allocation. But the 2028–2034 sums are in current prices, with assumed inflation of 2% a year, and the money arrives seven years later. Adjusted for inflation, the increase almost entirely disappears. And the comparison base does not include the 2021–2022 transition years of the agricultural policy, so on the same basis the envelope would rather be equal or smaller in real terms.
For farmers, the Alliance for Agriculture and Cooperation estimates that Romania could lose between 5.1 and 6.5 billion euros, and that the average direct payment could fall from about 221 to about 110 euros per hectare, according to Gândul. This is an estimate by a farmers' organisation, not a Commission figure.
More important than the amount is the capacity to spend it. Interim Minister of Investments and European Projects Dragoș Pîslaru announced in October an absorption rate of 31.56% of the 2021–2027 cohesion funds, up from 10.58% in June 2025, with less than three years left, according to Economedia. The last payment request under the recovery plan, filed on 30 September, asks for 4.35 billion euros net for 104 milestones and targets, and the Commission's assessment is under way.
In the new model, every missed milestone means money lost, not just delayed. The single plan gives the government more freedom to choose projects, but also all the responsibility. And Romania is in the excessive deficit procedure, so any higher co-financing or any suspended payment weighs directly on an already tight national budget.
The traps in the numbers
- Current versus constant prices. "Almost 2,000 billion" is in current prices, and "1,763 billion" is the same proposal in 2025 prices. Anyone comparing a figure of one kind with one of the other sees an increase or a cut that does not exist.
- The pandemic debt repayment takes up the budget. The 149.3 billion buy nothing new. Without them, the proposed budget is about 1.15% of gross national income, practically the same as the current one.
- The envelope is not a guarantee. The 60.2 billion is the Commission's opening offer, and the money is paid only for milestones met. Romania's recovery plan has already shown what missed milestones mean.
- Competitive grants are not allocations. Research, industry and defence are won in competition with companies and universities from all over Europe. Without teams that write good projects, the money goes to other countries.
- The farm minimum is not a target. The 293.7 billion is a minimum for income support. Investment in farms competes in the national plan with all other priorities.
- Own resources also cost the states. The contribution on non-recycled plastic packaging, in force since 2021, cost Romania almost one billion euros up to October 2025, according to a Deloitte analysis quoted by Libertatea. The levy on uncollected electronic waste would work the same way: the state that collects worse pays more.
- A late deal means a slow start. The 2021–2027 budget was politically agreed in July 2020 and adopted in December 2020, and the programmes started late, hence today's low absorption. Without a deal in time, the treaty extends only the ceilings of the last year, not the new programmes.
Three scenarios for the size of the deal
The scenarios concern the same variable: the total commitments in the European Council's political agreement, in 2025 prices, with debt repayment included, as in the Commission's proposal. They are conditional on a deal existing by 31 December 2027, cover all outcomes and add up to 100%.
- A · Close to the Commission, above 1,700 billion (20%): Costa restores the flexibilities cut by the Irish, states accept a bigger basket of own resources, and Parliament obtains extra money for agriculture and cohesion.
- B · Middle compromise, between 1,600 and 1,700 billion (50%): the deal starts from the Irish figure and adds a few tens of billions, mostly for defence and crises, in exchange for contribution rebates for the frugal states.
- C · The frugals win, below 1,600 billion (30%): Germany, Austria and their allies obtain further cuts, mostly from the Competitiveness Fund and external action.
Where the probabilities come from. In the last two negotiations, the deal came out 5–7% below the Commission's proposal: from 1,135 to 1,074 billion for 2021–2027 and from 1,033 to 960 billion for 2014–2020, each in the prices of the time. Applied now, the rule gives between 1,640 and 1,670 billion. The Irish compromise is already 8% below the Commission, and Austria wants "several billion" more cut. Our median is 1,640 billion.
When the deal comes
We give 30% for a political agreement in the European Council by 31 December 2026, 45% for the first half of 2027 and 25% for later. In favour of a quick deal are the pressure from Emmanuel Macron, who wants to close in December, and the risk of the 2027 elections. Against it are Austria's threat, the distance between the camps and Stocker's statement that net contributor states "do not necessarily need a quick deal".
The causal chain
Links 1, 2, 4, 5 and 6 are documented in the Commission's proposal and the European Parliament's analysis. Link 3 is the public position of the net contributor states, from their letters and statements. Link 7 follows from the proposed structure of the Competitiveness Fund. Link 8 combines the Commission's published allocation with our conclusion on payment for results, based on the recovery plan experience.
The counter-hypothesis we weighed: the Friends of Cohesion and Parliament could secure separate funds for agriculture and cohesion, and then the shift of money would be smaller than the proposal shows. The Irish compromise has already spared these two areas from large cuts. However, the Council backed the one-plan-per-country structure in June 2026, and the cuts moved to the new headings, not the old ones.
Table of predictions
| Prediction | Horizon | Probability | How it is checked | Verification source |
|---|---|---|---|---|
| The European Council reaches a political agreement on the 2028–2034 budget by the end of 2026 | by 31.12.2026 | 25–35% | Conclusions of a European Council announcing agreement on the multiannual financial framework | consilium.europa.eu |
| The political agreement comes between 1 January and 30 June 2027 | by 30.06.2027 | 40–50% | The same conclusions, with the meeting date in this interval | consilium.europa.eu |
| The political agreement comes after 30 June 2027 or not at all by then | by 30.06.2027 | 20–30% | No agreement announced by 30.06.2027 | consilium.europa.eu |
| Scenario A: the total in the deal exceeds 1,700 billion euros in 2025 prices | by 31.12.2027 | 15–25% | The total commitments in the conclusions of the deal, with debt repayment included | consilium.europa.eu |
| Scenario B: the total in the deal is between 1,600 and 1,700 billion euros | by 31.12.2027 | 45–55% | The same total | consilium.europa.eu |
| Scenario C: the total in the deal is below 1,600 billion euros | by 31.12.2027 | 25–35% | The same total | consilium.europa.eu |
| The deal keeps a single national and regional plan per country, covering agriculture and cohesion | by 31.12.2027 | 65–75% | The fund structure in the conclusions of the deal | consilium.europa.eu |
| The deal includes at least one new own resource, beyond the one on non-recycled plastic | by 31.12.2027 | 75–85% | The own-resources chapter in the conclusions of the deal | consilium.europa.eu |
| The Commission cuts or suspends at least 300 million euros from Romania's last recovery plan payment request | by 31.03.2027 | 55–65% | The Commission's preliminary assessment of the sixth payment request | commission.europa.eu |
The predictions on the size of the deal, its structure and own resources are void if there is no deal by 31 December 2027.
When we consider the analysis wrong
We set the thresholds in advance, so as not to interpret them after the fact.
- The money-shift thesis is wrong if the final deal keeps separate funds for agriculture and cohesion, each at least at the nominal 2021–2027 level.
- Our caution on the timetable is wrong if the leaders agree at the summit of 26–27 November or at the one of 17–18 December 2026.
- The payment-for-results thesis is called into question if the deal returns to reimbursing invoices for cohesion.
Main sources: the European Commission's proposal for the 2028–2034 financial framework and the table of allocations by state, the European Parliament research service briefings, analyses by Bruegel and the Jacques Delors Centre, and the Brussels and Romanian press cited in the text. The final figures will change in the negotiation; the table above tracks them.
