On 16 July, the European Commission unveiled its proposal for the next Multiannual Financial Framework (MFF), setting the EU’s long-term budget for the 2028 to 2034 period at nearly €2 trillion or 1.26% of the EU’s gross national income, which represents a moderate increase from the roughly 1.1% of the previous MFF. The MFF sets expenditure ceilings reflecting the main budgetary priorities for the period covered and helps ensure that EU funds are allocated in a strategic and consistent way over time.

According to the Commission, this new proposal aims to make the EU budget more flexible and able to respond to changing priorities. It also simplifies access to funding through more streamlined programmes and introduces tailored National and Regional Plans to better meet local needs and strengthen cohesion. Another major focus is boosting Europe’s competitiveness, securing supply chains, and taking the lead in clean technologies.

Concerns from climate NGOs over diluted priorities

While the Commission underlined that 35% of the total budget will go toward climate and environmental goals, many environmental NGOs have been really critical towards the proposal. While in the current MFF (2021–2027), biodiversity had a dedicated spending target; the new proposal merges climate and environment (which includes biodiversity) in a single 35% spending target covering six broad areas, from climate mitigation to pollution prevention and the circular economy.

NGOs have also raised concerns over the integration of the LIFE programme into broader tools like the National and Regional Plans and the new Competitiveness Fund. They argue  this could make biodiversity funding harder to track and access. The merging of the Just Transition Fund into the Social Climate Fund has raised similar fears, with some pointing out that its original focus could be weakened.

Positive reactions from the energy sector, but with some concerns

The energy and electrification sectors have mostly welcomed the proposal, especially the 35% commitment to climate and environmental spending. Earlier in July, EuropeOn joined 62 associations in calling for an ambitious climate spending target in the post-2027 MFF.

One positive highlight for many stakeholders, such as the power industry association or EHPA is the Connecting Europe Facility, which is set to receive a major boost to reinforce electricity grids across Europe. The new Competitiveness Fund has also been perceived as a step in the right direction, though some, like the NGO Transport & Environment, believe the funding allocated to it might not be enough.

Finally, both NGOs and some energy associations have criticised the lack of a clear commitment to phase out fossil fuel subsidies, which would be essential to meet the EU’s climate goals.

What happens next?

Now that the Commission has put forward its proposal, formal negotiations begin. First, the Council of the EU will review the proposal, followed by a consent vote in the European Parliament (which cannot amend the text). The final step is for the European Council — the heads of state or government of all EU Member States — to unanimously approve it.

This stage is often the most difficult, and early signs suggest this time will be no different. Germany, for instance, immediately pushed back against the idea of increasing the EU budget, citing national spending constraints. This strong stance could signal challenges in reaching the required unanimity to adopt the MFF.