Ahead of the European Commission’s mid-July presentation of proposals for the next long-term EU budget for 2028-2035, the European Court of Auditors (ECA) has released an analysis suggesting that simpler rules could lead to more efficient spending while reducing the risk of irregularities.
However, it cautions that this should not compromise the accountability in the use of EU funds, emphasizing the importance of an external audit to ensure proper accountability and transparency.
Amid geopolitical tensions and global challenges, the EU auditor highlights that the next Multiannual Financial Framework (MFF) presents an opportunity to assess the flexibility of the EU budget, ensuring both a sufficient degree of predictability and the ability to respond promptly and proportionately to changing circumstances.
The ECA also sees an opportunity to strengthen the link between EU funds supporting reforms of recurring structural challenges, considering national and regional specificities.
Regarding funding, the EU auditor acknowledges that needs will be high if new priorities require financing and existing policies maintain current spending levels while adhering to increasing obligations related to debt.
Concerning debt, the auditor refers to the Recovery and Resilience Facility model—funding the national Recovery and Resilience Plan—identifying weaknesses in performance focus, financing zero-cost measures, defining payment and eligibility conditions, and the need for clear supervision and control, as well as protecting the EU’s financial interests.
This mechanism operates on a common debt model, where the European Commission issues debt in financial markets on behalf of the EU to raise funds for reforms and investments in member states.
The ECA warns that, if considering debt in the next MFF, it is crucial to clearly establish financing needs and sources, mitigate risks, and prepare a repayment plan in advance.
“Meanwhile, the EU’s main revenue sources should be stable and simplified wherever possible,” it adds.
Following the European Commission’s proposal next month, it is up to the EU co-legislators (Council and Parliament) to negotiate the next budget for 2028-2035, with the negotiation process expected to conclude in 2026.
The MFF is set for a period of seven years, defining spending limits.
The current long-term EU budget ends in 2027, setting 1.21 trillion euros in commitments (at 2018 prices), representing the total amount the Union can commit to spending during this period.
The EU budget is funded by own resources, with about two-thirds of revenue coming from national contributions based on each country’s gross national income.
The idea of new own resources is becoming urgent as the European Recovery Mechanism allows the EU to borrow up to 800 billion euros in capital markets, which must be repaid by 2058.
The total cost of principal and interest repayment under the plan is expected to be about 20 to 30 billion euros annually from 2028 onward.
