EU Budget: Defence, Debt, Farmers—Epic Clash of the Decades!
EU’s Future Budget Battle Begins Next Week
The European Union will set the stage for a historic budget showdown within the next two years as it unveils its long‑term spending plan for 2028‑2034. Chancellor Ursula von der Leyen faces a tight juggling act: champion agriculture, defend the bloc, and slash the debt legacy of the pandemic.
Security First
- NATO “defence spend” pledge – Brussels must match the alliance’s call for five percent of national output for defence.
- Ukraine support – A €100bn emergency fund will be on the table, but the exact figure may shift before the final budget is released.
- Because EU treaties forbid direct defence spending, the Commission will redirect funds to dual‑use infrastructure that would be critical in wartime scenarios.
Farmers’ Hot‑Take
- CAP share – Agriculture consumes roughly one‑third of the EU’s multi‑year budget: €387bn, with €270bn paid directly to farmers.
- Cap on farm subsidies – The Commission is considering a limit on the amount a single farm can receive, a move that could free billions of euros.
- Farmers protest – The leading farming lobby, COPA, warns that any reductions on direct payments will spark massive demonstrations in Brussels.
- CAP integration debate – France opposes merging CAP into broader cohesion funds, while France, Italy and Poland push for more joint borrowing.
Funding the Future
- Joint borrowing limits – Germany, Finland, The Netherlands and Sweden refuseany general budget borrowing beyond the pandemic debt.
- Digital services levy & external import tax – These are potential revenue tools under consideration.
- Debt repayment start – From 2028, the EU must repay up to €30bn annually, after a €800bn loan was taken during the pandemic.
Next Steps
- The Commission will formally unveil the 2028‑2034 budget Wednesday.
- Brussels will face intense debates with capital cities and Parliament over the next two years.
- Farmers, defence, and fiscal reforms will be at the heart of the discourse.
For the EU, the coming weeks will determine whether the bloc can harmonise security, agriculture and fiscal policies while keeping economic resilience high.
