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Long-term EU budget - 16.05.2021

Understanding the EU’s 1.8-trillion-euro spending plans
Are you confused by all the talk of billions of euros the EU is planning to spend? Do you know where we are in the negotiation and adoption of the new European programmes for 2021-2027? If so, read on to find out more about the state-of-play, next steps and what these spending plans mean for local government.

The European Commission, the European Parliament and the Council have now agreed on the next budgetary programmes for 2021-2027. These will finance actions in various areas, including research and innovation, the digital and green transitions, equality, human rights, structural and investment funds, mobility and much more.

EU spending for the next six years amounts to €1.8 trillion. This is made up of the regular EU budget with the Multiannual Financial Framework (MFF, €1.07 trillion) and the temporary post-COVID recovery fund NextGenerationEU (€750 billion to be spent by 2023) which itself includes the Recovery and Resilience Facility (RRF, with €360 billion in loans to EU countries and €312.5 billion in grants).

There are a number of new priorities for the 2021-2027 period:
  • 30% of all funding to fight climate change
  • 20% of NextGenerationEU funding for the digital transformation
  • Specific attention to biodiversity protection and gender-related issues

New spending in areas like research and infrastructure mean that the Common Agricultural Policy (CAP), once the biggest EU spending area by far, has fallen to 30.9% of the budget from almost 60% in the 1980s. Economic, social and territorial cohesion spending, which directly benefits local and regional governments, has remained roughly stable at 30.4%.

You can find more information and figures here.

Unfortunately, as shown in our joint study with the Committee of the Regions, local and regional governments and their associations were largely excluded from the drafting of national recovery plans.

What are the next steps?

The modalities of programming are now being finetuned and work programmes developed. The European Commission will release more information for each programme in due course, but all should be running by autumn.

Here are the political agreements for the various programmes:
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