Germany and five other major contributors to the European Union budget are threatening to withhold their agreement on the bloc’s next seven-year spending plan unless hundreds of billions of euros are cut.
German Chancellor Friedrich Merz and the leaders of the Netherlands, Sweden, Denmark, Austria and Finland have called for major changes to the European Commission’s proposed 2028–2034 budget, which is valued at around €2 trillion.
The six countries together account for about 40% of EU budget revenues and are demanding substantial reductions to the proposed spending package. They want more resources directed toward defence, innovation and strengthening European industries, while seeking reductions in traditional areas such as agricultural subsidies and regional development funding.
In a letter seen by the Financial Times, the leaders argued that the EU budget needs to be fundamentally reformed and that spending priorities must change in response to Europe’s economic and security challenges. A diplomat from one of the six countries said there would be no agreement this year unless the budget was reduced by hundreds of billions of euros.
Their position contrasts with that of 17 other EU countries, including Spain and Italy, which are calling for increased funding for agriculture and regional development and a larger overall budget. Some of these countries have also supported additional EU-level borrowing to finance higher spending, a proposal opposed by Germany and its allies.
The 2028–2034 EU budget requires the agreement of all 27 member states. Ireland, which currently holds the rotating presidency of the EU, has been tasked with helping prepare a compromise proposal ahead of the October negotiations.
