EU Budget Focus on Key Programs

By Jan Strupczewski
BRUSSELS (Reuters)
The European Union's next long-term budget should emphasize fewer programs while linking reforms with investment to target priority areas, according to Budget Commissioner-designate Piotr Serafin.

His statements come in response to inquiries from the European Parliament, which will confirm his appointment managing the EU's current €1.27 trillion budget and preparing the next one.

Preparation for the 2028-2034 budget has begun as the 27-nation bloc navigates costly challenges, including transforming its economy to reduce CO2 emissions, enhancing defense capabilities, and competing with China and the United States in new technologies.

"This means a budget that supports European public goods and positive spillover to reach our common goals, notably defense and security, sustainable prosperity and competitiveness, and democracy and social fairness," Serafin stated.

He advocates for a more focused budget with plans specific to each member country, linking essential reforms with targeted investments in areas where EU action is crucial.

Emphasizing the importance of equalizing living standards across regions for a united Europe, Serafin intends to strengthen cohesion policies, allowing regions to dictate spending priorities.

To maximize the budget—representing just 1% of EU GDP—Serafin aims to utilize EU funds to attract significantly greater private and public investment for transitioning to a greener, digital economy.

"The EU budget must be the driver to leverage private and institutional funding and ensure coherence with national budgets, including via co-financing, to deliver on EU priorities," he noted.

Additionally, in order to manage and repay €800 billion in joint EU borrowing related to post-pandemic recovery, Serafin stressed the necessity of finalizing a deal on new revenue sources for the EU by 2026, before debt servicing begins in 2028.

Lastly, Serafin highlighted the need for a more flexible budget, pointing out that the current 2021-2027 budget was inadequately prepared for unforeseen events like the war in Ukraine, the resulting energy crisis, or increasingly frequent climate change-induced disasters.

($1 = 0.9276 euros)