EU joint budget proposal slashed in race to find end-year agreement

Submission Statement: Ireland has cut €141bn from a proposed EU budget in an effort to find consensus among deeply divided capitals on the size and priorities of the bloc’s spending.

The revised 2028-34 budget is 8 per cent smaller than the European Commission’s original proposal in a sop to rich countries led by Germany, which had demanded “hundreds of billions” in cuts to secure their approval.

Dublin left funding for traditional policies — agriculture and regional funding — largely uncut at €914bn, down from €946bn in the Commission’s proposal. This would be an 11 per cent increase from the previous budget period.

Most of the cuts come from EU foreign policy and development aid, which fell from €190bn to €157bn, a 17 per cent cut.

Ireland also slashed funding for innovative companies and defence by 13 per cent, from €522bn to €456bn. This is still more than double the current budget period. It cut €9bn from the costs of running the EU administration.

But the cuts are unlikely to be sufficient for some.

“The Irish proposal is a disappointment and not even close to a landing zone,” said one EU diplomat who described it as “unaffordable and financially not viable at all”.

“By favouring policy priorities of the 20th century the proposal fails to prepare the EU for the 21st century,” the official added. “This [proposal] is no basis for an agreement among member states. We urgently need more financial realism and less financial La-La Land.”

Six countries that are net contributors to the budget, led by Germany, had demanded “hundreds of billions” in cuts, dismissing new joint borrowing and only tepidly embracing EU-level taxes as a way to finance common spending.