Merz pushes for major cuts to EU's proposed €2 trillion budget

German Chancellor Friedrich Merz has called for hundreds of billions of euros in reductions to the European Commission's proposed long-term budget, arguing that the plan is unaffordable while member states are implementing domestic spending restraints.

Speaking after a meeting with European Council President Antonio Costa in Berlin, Merz noted that the Commission's proposals for the next Multiannual Financial Framework (MFF) envisage a 60% increase over the current seven-year budget period. "At a time of budget cuts in all member states, that is simply unaffordable," he said.

Germany, along with Denmark, the Netherlands, Austria, Finland, and Sweden, had already stated in August that the proposed budget of nearly €2 trillion for 2028 to 2034 should be reduced "in a balanced manner," with all spending areas contributing to the cuts.

Merz emphasized that reductions should apply across all policy areas and rejected the idea of relying on further joint EU borrowing to bridge any gap. "Excessive debt threatens our sovereignty and our capacity to act," he warned, adding that governments face the "admittedly painful task" of setting priorities.

Costa echoed the need for fiscal prudence, stating, "We cannot ask (for) more from member states. We need to create new own resources in order to protect the national budgets."

Merz also called for the bloc's next budget to shift spending towards competitiveness and defence, arguing that a "20th-century budget" could not address current challenges.

The EU's MFF requires unanimity among all 27 member states. Both Costa and Merz expressed a desire to reach an agreement by the end of 2026.