Next-Gen Europe: Commission Proposes Record Budget to Shape the Decade Ahead

Europe is raising the stakes for its future. With nearly EUR 2 trillion on the table, the EU’s new long-term budget promises to supercharge competitiveness, boost resilience, and assert global influence—all while staying flexible for whatever comes next.

The European Commission has presented its most ambitious budgetary proposal to date, unveiling a new Multiannual Financial Framework (MFF) for 2028–2034 amounting to nearly EUR 2 trillion, or 1.26% of the EU’s gross national income on average. The proposal aims to provide the EU with the necessary financial resources to ensure its long-term resilience, security, competitiveness, and global standing. According to the Commission, this framework will enable Europe to better respond to emerging challenges, support vital reforms across Member States and regions, and accelerate the twin green and digital transitions. The proposal, along with factsheets and legal texts, is available on the Commission’s official site.

Flexibility and Strategic Investment at the Core of the New MFF

At the heart of the proposal is a more flexible and responsive budget structure, designed to allow the Union to act rapidly when circumstances change or new priorities emerge. The Commission promises simplified financial programmes, harmonised rules, and a more user-friendly funding environment. National and Regional Partnership Plans will play a key role in shaping investment strategies tailored to local needs, reinforcing cohesion and maximising the return on every euro spent. The new budget also introduces minimum allocations for less developed regions, alongside safeguards to ensure that no Member State receives less than under the current cohesion funding framework.

The budget will be more closely aligned with citizens’ needs and regional priorities, aiming to reduce disparities while enhancing overall convergence across the Union. Funding for agriculture will continue to support income protection for farmers, sustainability, and modernisation. Simplified rules will cover payments, audits, and controls, making the system more efficient and transparent. Social policy will also receive a boost, with the European Social Fund Plus expected to reinforce safety nets, support inclusive employment, and promote equal opportunities.

A Major Push for Competitiveness, Innovation and Clean Technologies

One of the central pillars of the new MFF is a dedicated European Competitiveness Fund, which will provide targeted support in four strategic sectors: clean and digital transition, health and biotech, agriculture and bioeconomy, and defence and space. This new fund will operate under a single rulebook and serve as a one-stop gateway for funding applications, simplifying access for businesses and speeding up disbursement. It aims to crowd in private investment and streamline public financing to ensure maximum impact.

Linked to this is the continuation of the Horizon Europe programme, which will receive EUR 175 billion to support top-tier research and innovation across the continent. Together, these instruments will back the entire lifecycle of innovation projects, from concept to scale-up, while strengthening the EU’s strategic autonomy in key technological areas.

Boosting Crisis Preparedness, Defence and Strategic Autonomy

In light of recent geopolitical shocks and the COVID-19 pandemic, the proposed budget includes major investments in resilience and preparedness. A new EUR 400 billion crisis response mechanism will provide loans to Member States when severe emergencies strike. Meanwhile, the Union Civil Protection Mechanism and health emergency preparedness tools will be reinforced to enhance Europe’s ability to respond quickly and effectively to future threats. Agricultural markets will also benefit from a reserve fund to stabilise income during crises.

Defence receives a substantial boost under the new budget. The defence and space strand of the Competitiveness Fund will be allocated EUR 131 billion, a fivefold increase compared to the previous MFF. This funding will not only support dual-use infrastructure via the Connecting Europe Facility, but also increase investments in cybersecurity, strategic mobility, and military readiness. The new MFF also triples support for migration management and border security, with EUR 34 billion earmarked to equip border guards, strengthen surveillance, and bolster law enforcement capabilities.

CEF reports it will finance cross-border infrastructure and dual-use military mobility projects and will cover projects of common interest that contribute to the development of a smart, sustainable and resilient European transport network. It includes the completion of the TEN-T network, key rail technologies such as the European Rail Traffic Management System (ERTMS) and Digital Automatic Coupling (DAC), as well as the development of European the high-speed rail network.

At the same time, CER stresses the need for improvements during the upcoming interinstitutional negotiations. Key priorities include:

• Securing an adequately sized MFF to meet the EU’s policy ambitions;
• Ensuring that the proposed flexibility in budget allocations does not undermine funding predictability for long-term infrastructure planning;
• Clarifying the process for defining CEF and ECF work programmes by also including structured stakeholder consultations, with the direct involvement of the rail sector, in the programming and implementation phases.

Cohesive Action for Global Partnerships and Ukraine Support

The external action component of the new MFF is structured around the Global Europe Instrument, a EUR 200 billion facility designed to maximise the EU’s global visibility and strategic outreach. It includes a EUR 15 billion reserve for responding to international crises and unforeseen needs. Notably, the EU will be able to mobilise up to EUR 100 billion for Ukraine between 2028 and 2034, reflecting the Union’s long-term commitment to reconstruction, reform, and integration. Military-related assistance will continue under the European Peace Facility, while Common Foreign and Security Policy (CFSP) actions will receive a further EUR 3.4 billion.

The Commission points out that this level of international engagement is not just a matter of values, but also a strategic investment in the EU’s own stability and influence. Reinforced external action will be backed by more transparent financing and closer scrutiny of beneficiaries, with a centralised EU budget database offering insight into funding allocation and recipient compliance with EU rules.

Source: European Commission; CEF