September 21. 2023. 2:54

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European Commission proposes €189.3 bln for 2024 EU budget

The European Commission proposed on Wednesday (7 June) €189.3 billion for the 2024 EU budget, including almost €4 billion for the repayment of EU borrowing. The budget will need to be negotiated and agreed by member states and the European Parliament in the coming months.

This year’s proposal comes amid increased pressure on the budget due to concerns about its capacity to repay the debt incurred for borrowing the Next Generation EU pandemic funds in 2020.

“The EU budget, like national budgets, is facing constraints due to rising costs while the financing needs are not decreasing,” the EU Commissioner for Budget Johannes Hahn said in a statement on Wednesday, following the publication of the Commission’s proposal.

Today we have proposed the #EUbudget for 2024 with a volume of €189.3 bn.

Together with #NextGenerationEU, their combined firepower will continue to drive Europe’s ongoing economic recovery and create jobs, while strengthening our strategic autonomy. 1/2

— Johannes Hahn (@JHahnEU) June 7, 2023

Spending focus

Compared to the 2023 budget, the proposal includes €3.96 billion for rising borrowing costs for Next Generation EU, bringing the spending share for people, social cohesion and values from €4.8 billion to €10.3 billion.

The budget for other spending priorities is similar to last year’s proposal, with €53.8 billion for agricultural policy, €47.9 billion for cohesion policy, €15.8 billion for neighbourhood and international relations, €13.6 billion for research and innovation.

The 2024 budget spending will also focus on strategic investments, environment, border protection and migration, as well as defence.

Overall, while the budget proposed for next year is €2.7 billion more than the one agreed for 2023, the increase does not compensate for high inflation levels.

Next steps

The EU Council will now have to agree its position on the proposed budget. The European Parliament will then be able to propose its own amendments to the member states’ position.

In particular, MEPs will likely insist on avoiding possible cuts to the budget proposed by member states, which in their view could negatively impact EU programmes such as Erasmus+ or the Horizon research programme.

Commission should resist calls to reduce EU budget, MEP says

The EU Commission should not accept member states’ demands to reduce the EU budget, said MEP Siegfried Mureșan, as discussions around the EU budget for 2024, as well as the revision of the Union’s long-term budget, draw closer.

As the positions of member states and MEPs are expected to differ, a conciliation committee will be created to find an agreement, which is then usually reached by November.

Failing that, the Commission will be asked to put forward a new proposal for next year’s budget.

More budget proposals ahead

Meanwhile, the Commission will also propose a revision of the Union’s long-term budget – known as the Multiannual Financial Framework – together with a package of new direct revenue streams, in an effort to respond to the wide concerns over the impact of inflation and the Next Generation EU debt on the current budget capacity.

The two proposals are expected on 20 June.

European Parliament calls for new sources of revenue for EU budget

EU lawmakers expressed concerns over the EU budget’s capacity to repay funds borrowed for the coronavirus recovery plan without new sources of income, calling on the European Commission to consider new streams of revenue.

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