PURPOSE: presentation by the Commission of the EU’s draft annual budget for 2025.
CONTENT: in February 2024, the European Parliament gave its consent to, and the Council unanimously agreed on the first ever mid-term revision of the expenditure ceilings in the multiannual financial framework (MFF).
The agreement reached on the mid-term revision of the MFF reflects the importance of equipping the EU budget with the necessary means to continue delivering on the priorities for Europe and for our partners, which was underscored by key sectoral proposals. In particular, the revision restores the Union’s financial capacity to address a series of exceptional challenges; first and foremost Russia’s unprovoked and unjustified war of aggression against Ukraine, the continued migratory pressures and their root causes, responding to the crisis in the Middle East and reinforcing the EU’s capacity to respond to natural disasters and the global competition on key critical technologies and materials, as well as strengthening our defence capabilities.
DRAFT BUDGET 2025
The draft budget 2025 sets appropriations of EUR 199.7 billion in commitments (corresponding to 1.08% of GNI) and EUR 152.7 billion in payments, including special instruments, leaving EUR 31 billion of margin below the payment ceiling for 2025. The budget will be complemented by an estimated EUR 72 billion of disbursements under NextGenerationEU. This financial envelope will support the EU in meeting its political priorities while integrating the changes agreed in the mid-term revision of the MFF in February 2024.
The draft budget 2025 and the accompanying updated financial programming for 2026-2027 together reflect the outcome of the MFF revision for the remaining years of the MFF period (2025-2027). This covers in particular:
- stable and predictable support to Ukraine, through the Ukraine Facility;
- migration, with funding addressing the root causes of irregular migration and forced displacement, as well as reinforced funding for migration and border management in the most affected Member States, to accompany a balanced approach to migration that is both fair and firm;
- green and digital transitions, creating jobs while strengthening Europe's strategic autonomy and global role. It will enable support to key critical technologies through the Strategic Technologies for Europe Platform (STEP);
- increased funding for flagship programmes such as Erasmus+, the Connecting Europe Facility (CEF) and the Single Market Programme (SMP), while the large-scale funding of research and innovation activities under Horizon Europe stays broadly stable until 2027;
- funding for other recently agreed EU initiatives or shared priorities, such as the European Chips Act, the Union Secure Connectivity Programme, the set-up of the Carbon Border Adjustment Mechanism (CBAM), the Anti-Money Laundering Authority (AMLA) and the European Defence Industry Programme (EDIP);
- continued support for Syrian refugees in Turkey and the wider region, the Southern Neighbourhood, including the external dimension of migration, and the Western Balkans.
- continued support for Syrian refugees in Türkiye and in the wider region, as well as for the Southern Neighbourhood, including for the external dimension of migration and the Western Balkans.
APPROPRIATIONS BY HEADING OF THE MFF 2021-2027
To meet the EU's various priorities, the Commission proposes to allocate the following amounts (in commitment appropriations):
Heading 1 - Single Market, Innovation and Digital: EUR 21.3 billion
- EUR 13.5 billion for research and innovation, including EUR 12.7 billion for Horizon Europe, the Union's flagship research programme. The Draft Budget also includes the financing of the European Chips Act under Horizon Europe;
- EUR 4.6 billion for European strategic investments, including EUR 2.8 billion for the Connecting Europe Facility to improve cross-border infrastructure, EUR 1.1 billion for the Digital Europe Programme to shape the Union's digital future, and EUR 378 million for InvestEU for key priorities (research and innovation, twin green and digital transition, the health sector, and strategic technologies);
- EUR 977 million to ensure the functioning of the Single Market, including EUR 613 million for the Single Market Programme, and EUR 205 million for work on anti-fraud, taxation, and customs;
- EUR 2.1 billion for spending dedicated to space, mainly for the European Space Programme;
- EUR 196 million for secure satellite connections under the new Union Secure Connectivity Programme.
Sub-heading 2a - Economic, social and territorial cohesion: EUR 66.3 billion
- EUR 47.2 billion for regional development and cohesion to support economic, social and territorial cohesion, as well as infrastructure supporting the green transition and the Union's priority projects;
Sub-heading 2b - Resilience and values: EUR 11.8 billion
- EUR 11.8 billion of which, among others, EUR 5.2 billion for the rising borrowing costs for NGEU, EUR 4 billion Erasmus+ to create education and mobility opportunities for people, EUR 352 million to support artists and creators around Europe, and EUR 235 million to promote justice, rights, and values;
- EUR 583 million for EU4Health to ensure a comprehensive health response to people's needs, as well as EUR 203 million to the Union Civil Protection Mechanism (rescEU) to be able deploy operational assistance quickly in case of a crisis;
Heading 3 - Natural resources and the environment: EUR 57.2 billion (of which market-related expenditure and direct payments: EUR 40.5 billion)
- EUR 53.8 billion for the Common Agricultural Policy and EUR 0.9 billion for the European Maritime Affairs, Fisheries and Aquaculture Fund, for European farmers and fishermen, but also to strengthen the resilience of the agri-food and fisheries sectors and to provide the necessary opportunities for crisis management;
- EUR 2.4 billion for the environment and climate action, including EUR 771 million for the LIFE programme to support climate change mitigation and adaptation, and EUR 1.5 billion for the Just Transition Fund;
Heading 4 - Migration and border management: EUR 4.7 billion
- EUR 2.1 billion for migration-related spending within the EU, of which mainly EUR 1.9 billion to support migrants and asylum-seekers in line with our values and priorities;
- EUR 2.7 billion for protecting borders, of which mainly EUR 1.4 billion for the Integrated Border Management Fund (IBMF), and EUR 997 million (total EU contribution) for the European Border and Coast Guard Agency (Frontex);
Heading 5 - Security and defence: EUR 2.6 billion
- EUR 1.8 billion to meet defence challenges, including EUR 1.4 million to support capability development and research under the European Defence Fund (EDF), EUR 244.5 million to support military mobility;
- EUR 784 million for security, including EUR 334 million for the Internal Security Fund (ISF), which will combat terrorism, radicalisation, organised crime and cybercrime.
Heading 6 - Neighbourhood and the world: EUR 16.3 billion
- EUR 16.3 billion to support partners and interests in the world, of which, among others, EUR 10.9 billion under the Neighbourhood, Development and International Cooperation Instrument — Global Europe (NDICI — Global Europe), EUR 2.2 billion for the Instrument for Pre-Accession Assistance (IPA III) and EUR 0.5 billion for the Growth Facility for the Western Balkans, as well as EUR 1.9 billion for Humanitarian Aid (HUMA).
Heading 7 - European public administration: EUR 12.6 billion
Thematic special instruments: EUR 6.6 billion
The 'thematic special instruments' include the Solidarity and Emergency Aid Reserve, the European Globalisation adjustment Fund for redundant workers (EGF), the Brexit adjustment reserve and the Ukraine Facility. A further EUR 4.3 billion will be available in grants under the Ukraine Facility complemented by EUR 10.9 billion in loans.