The Cyprus Presidency of the Council of the EU has put forward a revised negotiating package for the bloc’s next long-term budget, proposing an overall reduction of about 2% from the European Commission’s original draft for 2028–2034.

Published on Thursday afternoon, the package marks a more advanced stage in the talks on the next Multiannual Financial Framework. Unlike earlier versions, it moves beyond broad ranges and sets out specific figures across the main budget headings, giving member states a clearer basis for negotiation. The Presidency stresses, however, that the text is not a final agreement, but a framework intended to help governments move closer to common ground.

The revised package is based on the Commission’s July 2025 proposal and is around €32.8 billion lower than the original draft. In overall terms, it would amount to roughly 1.23% of EU Gross National Income, or 1.13% if repayments linked to NextGenerationEU debt are excluded.

The reduction is not applied mechanically across all areas. Instead, the Presidency has sought to adjust the figures according to the political importance, institutional constraints and practical needs of each policy field. That makes the package less of a simple cost-cutting exercise and more of an attempt to rebalance a proposal that had already triggered concerns among several member states.

Cohesion, agriculture and fisheries

The most sensitive part of the package remains the first heading, which covers cohesion policy, agriculture and fisheries. These are the areas where EU budget decisions are felt most directly at national and regional level, and where even small shifts in funding can carry significant political weight.

The Commission’s original proposal had already implied real-term reductions compared with the current MFF. Fisheries had been among the hardest hit, with committed appropriations initially reduced by around 70%. The Cyprus Presidency’s package partially corrects that by raising the relevant envelope to €2 billion in current prices. Even so, the amount would still be about 38.5% lower than under the current budget cycle.

Cohesion policy is also expected to remain a difficult part of the negotiations. The revised text draws attention to member states with Gross National Income below 90% of the EU average, where the initial design was seen as failing to sufficiently address investment gaps, particularly in transport and environmental infrastructure. The issue is likely to feed into wider discussions on how far the next budget should protect traditional convergence policies while also financing newer EU priorities.

In agriculture, the Presidency’s approach builds on changes already introduced to give member states more room to manage funds according to their needs. One such adjustment would allow resources to be moved from flexibility reserves into Common Agricultural Policy interventions, giving governments more space to respond to implementation pressures on the ground.

A moderation of growth

For the headings covering competitiveness, defence, security, research and external action, the Cyprus Presidency proposes a uniform adjustment of around 3.9% in each area.

These sectors had received large increases in the Commission’s original draft, reflecting the EU’s effort to respond to a more demanding geopolitical and economic environment. For that reason, the revised figures are being framed less as outright cuts and more as a moderation of growth.

Even after the proposed adjustment, funding would remain clearly above current levels. The package therefore keeps intact the broader direction of the Commission’s proposal, with defence readiness, technological development, competitiveness and strategic autonomy still treated as central priorities for the post-2027 period.

The fourth heading would see only a limited adjustment of 0.5%, reflecting the narrow budgetary margin available. Specific allocations linked to overseas territories and treaty-based obligations, including the Euratom programme, are not affected.

National plans remain central

The framework also keeps the National and Regional Partnership Plans at the centre of the new budget architecture. These plans would remain the main channel for national allocations and would underpin major areas of spending, including cohesion and agriculture.

At the same time, the Presidency’s text gives more weight to multi-level governance and partnership, with regions expected to have a stronger role in how programmes are designed and implemented. This is intended to address concerns that the new architecture could become too centralised at national level.

The European Competitiveness Fund is another key pillar of the proposed framework. It would bring together competitive programmes without pre-allocated national envelopes and would focus on areas such as research and innovation, defence and space, clean technologies, digital transformation and health. Technical negotiations on the fund are understood to be at an advanced stage.

Progress is also reported on Global Europe, the programme that would reshape the EU’s external financing structure. The aim is to bring development cooperation closer to the Union’s wider geopolitical priorities, while preserving the predictability and stability of development assistance.

The Cyprus Presidency’s package is not the end of the process, but it is an important step in narrowing the gaps between member states. The objective is to create the conditions for a political agreement by 2026, giving governments enough time to prepare their national programmes before the next budget cycle begins after 2027.

Source: CNA

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