EU Budget Cut 8% to €1.6 Trillion

The European Union presidency has proposed an 8% cut to its 2028-2034 budget, reducing it to €1.6 trillion. This move is an effort to appease countries demanding major cuts, with the bulk of the reductions coming from foreign aid, competitiveness, and administrative costs.

The proposed budget cut amounts to €159 billion from the Commission's original proposal. The Irish presidency, led by Minister of State for European Affairs Thomas Byrne, proposed cutting around 8% to the bloc's total budget from 2028 to 2034.

The cuts include significant reductions in foreign aid, with a decrease of €38 billion, and competitiveness, which will be axed by €75 billion. Additionally, the EU's administrative costs will be reduced by €10 billion. On the other hand, farmers' subsidies and regional payouts, which account for half of the total budget, were shielded from cuts.

The EU Facility cushion, a rainy day fund, was also scrapped as part of the proposal. This fund allowed the European Commission to deploy cash to tackle unforeseen emergencies throughout the seven-year budget cycle.

## Why it matters The proposed budget is part of ongoing negotiations among EU leaders, with a summit scheduled for the following week. The bloc is split between frugal countries demanding cuts and a rival camp of southern and eastern states opposing reductions. The outcome of these negotiations will have significant implications for the EU's priorities and spending over the next seven years.

The proposal has been defended by Ireland's Minister of State for European Affairs Thomas Byrne as a balanced compromise between 27 countries. However, some countries have expressed disappointment and warned against disproportionate cuts to new priorities. The negotiations will continue, with EU leaders aiming to reach a consensus on the budget.