EU governments have moved a step closer to a deal on three major parts of the bloc’s next long-term budget. The Council agreed partial negotiating positions on regional funding, competitiveness and external action. The decisions mark an early but important step in shaping the EU’s 2028–2034 financial framework.
At the heart of the reform is a new model for how EU money reaches member states. The proposed national and regional partnership plans (NRPP) would replace a wide range of existing programmes. Instead of managing separate funds, each country would submit a single plan covering cohesion policy, agriculture, fisheries, migration, security and climate-related spending.
The aim is to make the EU budget simpler, less fragmented. Each plan would combine investments tailored to national and regional needs. Countries would have to show how they intend to support economic development, reduce regional inequalities, strengthen agriculture, improve security and invest in social priorities.
For Marilena Raouna, deputy minister representing the Cypriot Presidency of the Council, the NRPP is the key pillar of the next multiannual financial framework (MFF). “By bringing fundamental EU priorities together under a single fund, we can deliver more effectively and respond faster to known and future challenges, both regionally and nationally,” she said.
You might be interested
Funding would not flow automatically. Payments would depend on agreed reforms and milestones. The European Commission would release money in stages, once targets are met. The system should make spending more effective while giving governments greater flexibility to focus on the priorities most relevant to them.
The proposal also seeks to preserve a strong role for regions and local authorities. National plans would have to be prepared in partnership with regional governments and other stakeholders. EU governments argue this should help simplify funding without sidelining the authorities that are often responsible for delivering projects on the ground.
Competitiveness fund to replace 14 separate instruments
A second pillar, which the Coucil tackled on Tuesday, focuses on Europe’s economic strength. EU ministers backed plans for a new European Competitiveness Fund (ECF). The fund would merge up to 14 existing programmes into a single structure. It aims to support innovation, industry and strategic technologies.
According to Cyprus Minister for Energy, Commerce and Industry Michael Damianos, the fund is “a unique chance to scale up investment” and unlock Europe’s competitiveness potential. It will target four areas: clean industry, digital leadership, health and biotech, and security, defence and space. The idea is to make EU funding simpler to access and direct more resources towards areas where Europe is seen as falling behind global competitors, particularly the United States and China.
The ECF is also meant to help turn public money into larger investments by attracting private capital. Rather than relying entirely on public funding, the EU wants its financial support to encourage businesses and investors to put more of their own money into promising projects.
Smaller companies are expected to benefit from the support. The broader goal is to help more European ideas, technologies and businesses develop at home instead of losing ground to competitors abroad.
Global Europe: a more geopolitical EU toolbox
The third agreement reached on Tuesday covers the EU’s external spending. The new Global Europe instrument brings together development, neighbourhood, enlargement and foreign policy tools. It aims to make EU external action faster and more flexible.
It strengthens support for candidate countries and potential candidates on their path toward EU integration. A major focus of the reform is on relations with countries in the EU’s neighbourhood, particularly in Eastern Europe.
It is also designed to give the bloc more flexibility to respond to unexpected events, such as geopolitical crises, natural disasters or sudden migration pressures. The goal is to ensure that the EU can react more quickly when circumstances change, rather than being constrained by rigid long-term funding plans. Cyprus Foreign Minister Constantinos Kombos said the EU needs “an instrument both strategic and flexible” in an unpredictable world.
The proposal also reflects a broader shift towards linking external spending more closely to the EU’s strategic interests. Migration cooperation would play a larger role, with financial support increasingly connected to partner countries’ willingness to work with the EU on migration management and the return of their own nationals.
Common direction, but hard negotiations ahead
All three deals point in the same direction. The EU wants fewer programmes, bigger funding pools and more performance-based spending. It also wants stronger control from member states and faster delivery on priorities.
But these are only partial positions, with the European Parliament yet to come into play with its own positions. Moreover, they tackle the legislative frameworks, not the size of each envelope. Full negotiations on the framework — which the European Commission set at €2 trillion, representing 1.26 per cent of EU’s gross national income, in its draft proposal — will continue through 2026. The final deal will decide how the EU spends its money from 2028 onwards.
