In November 2023, the European Parliament and the Council of the European Union reached an agreement on the EU budget for 2024, which is expected to assist addressing most urgent issues for the 27 EU states, as well as European neighboring countries. The article reveals some priorities in the next year budget and urgently needed revision of the multi-annual financial framework for up to 2027.
Main priorities in the 2024 annual budget
The EU-2924 budget provides key funding to the Union’s political priorities, notably to drive Europe’s ongoing economic recovery and create jobs, fostering the green and digital transitions for a secure and more resilient Europe, which plays a strong role in the world.
In this context, the EU budget will continue to support the six headline ambitions set out by the Commission’s plans, such as the European Green Deal, European digital transition, social-market economy, promoting European way of life, stronger Europe in the world and new incentive for democracy, etc.
The agreement ensures funding for the EU’s priorities for 2024 budget with the commitments of €189.4 billion, and payments of €142.6 billion. The 2024 budget will continue supporting the ongoing economic recovery while strengthening Europe’s strategic autonomy. Green and digital spending will continue to be prioritized to make Europe more resilient and fit for the future, including through NextGenerationEU, NGEU.
It has been agreed to finance the following main EU’s integration priorities:
= €16.2 billion to support neighbor states as well as international development and cooperation: i.e. the increases in the Humanitarian Aid program (€1.9 billion) to address crisis situations across the globe, including pressing needs in the EU’s neighbourhood. The funding for the Neighbourhood, Development and International Cooperation Instrument – Global Europe (€11.5 billion) focuses, e.g. on migration in the southern neighbourhood, on root causes of migration in Africa and elsewhere, as well as on funds to Moldova to carry out the necessary enlargement reforms. Another €2.1 billion will be available for the Instrument for Pre-Accession Assistance, IPA III to support reforms in the Western Balkans and other regions;
= €53.7 billion for the Common Agricultural Policy and €1.1 billion for the European Maritime, Fisheries and Aquaculture Fund; for Europe’s farmers and fishers, but also to strengthen the resilience of the agro-food and fisheries sectors and to provide necessary support for crisis management;
= €47.9 billion for regional development and cohesion to support economic, social and territorial cohesion, as well as infrastructure reforms, green transition and Union priority projects;
= €13.6 billion for research and innovation, of which €12.9 billion for Horizon Europe, the Union’s flagship research programme. This budget line also includes the financing of the European Chips Act under Horizon Europe and the Digital Europe Program;
= €4.6 billion for European strategic investments, of which €2.7 billion for the Connecting Europe Facility to improve cross-border infrastructure, €1.3 billion for the Digital Europe Programme to shape the Union’s digital future, and €348 million for InvestEU for key priorities (research and innovation, twin green and digital transition, the health sector, and strategic technologies);
= €2.3 billion for spending dedicated to space, mainly for the European Space Program, which will bring together the Union’s action in this strategic field;
= €21.9 billion for people, social cohesion, and values, €16.8 billion for the European Social Fund (ESF+), €3.8 billion Erasmus+ to create education and mobility opportunities for people, €335 million to support artists and creators around Europe, and €261 million to promote justice, rights, and values;
= €3.3 billion for the rising borrowing costs for NextGenerationEU, so-called NGEU plan;
= €2.4 billion for environment and climate action, of which €765 million for the LIFE program to support climate change mitigation and adaptation, and €1.5 billion for the Just Transition Fund to make sure that the “green transition works for all”;
= €2.2 billion for protecting EU external borders, of which €1.2 billion for the Integrated Border Management Fund and €859 million for the European Border and Coast Guard Agency;
= €1.7 billion for migration-related spending, of which €1.5 billion to support migrants and asylum-seekers in line with the EU values and priorities;
= €1.6 billion to address defense challenges, of which €638 million to support capability development and research under the European Defense Fund, €251 million to support military mobility program, €260 million for the new short-term defense instruments and €343 million to support the production of ammunition;
= €958 million to ensure the functioning of the Single Market, including €602 million for the Single Market Program and €200 million for work on anti-fraud, taxation and customs issues;
= €754 million for EU4Health program to ensure a comprehensive health response to people’s needs, as well as €240 million to the Union Civil Protection Mechanism to be able deploying operational assistance quickly in case of a crisis; and
= €733 million for security, of which €322 million for the Internal Security Fund, which will combat terrorism, radicalisation, antisemitism, organised crime and cybercrime.
More in: https://ec.europa.eu/commission/presscorner/detail/en/ip_23_5685 and https://eur-lex.europa.eu/budget/www/index-en.htm
Mid-term revision of the Multiannual Financial Framework
The Commission acknowledged that a swift agreement on the revision of the Multiannual Financial Framework, MFF is urgently needed to ensure that the EU-2024 budget will be able to respond to the continued migratory pressures and their root causes, natural disasters in the EU and in the EU’s neighbourhood and beyond, and the global competition on key critical technologies.
Besides, by revising the MFF, the EU will be able to continue providing robust support to Ukraine and to cope with the war’s consequences. The European Parliament and the Council have committed to a swift adoption of an amending budget to integrate the outcome of the MFF revision for the year 2024 in the annual budget. The Commission stands ready to make the related proposals as soon as progress has been made in the MFF negotiations.
More in: https://ec.europa.eu/commission/presscorner/detail/en/QANDA_23_5686
In June 2023, the Commission proposed to reinforce the EU’s MFF in order to continue on delivering on the most essential new tasks and objectives, via:
= the setting up of a Ukrainian “facility” with €50 billion for 2024-2027 to cater for Ukraine’s immediate needs, recovery and modernisation on its path towards the EU.
= €15 billion to help the EU states in addressing internal and external dimensions of migration, as well as covering needs arising from the global consequences of Russia’s war in Ukraine, and stronger partnerships with key third countries.
= financing Strategic Technologies for Europe Platform, STEP to promote the EU’s long-term competitiveness on critical technologies.
= catering increasing NextGenerationEU funding costs due to the unprecedented surge in interest rates.
Total addition to the original MFF of about €1,2 trillion, some €809 billion is needed –mainly from the reformed NGEU- to cover newly emerging European needs.
On its own and in its current form, the 2024 budget is not enough: apparently more needs to be done, beyond the financing of some of the urgent needs in the next year budget with expected global transformations and possible crises.