The European Court of Auditors (ECA) has warned that the European Commission’s proposed overhaul of the EU’s next long-term budget does not, on its own, guarantee that European money will be spent better.
In a report published on April 27, the ECA said the planned reform of the multiannual financial framework (MFF) for 2028-2034 — worth nearly €2 trillion — introduces sweeping changes that could pose risks to sound financial management and require stronger safeguards.
The auditors said the reform, put forward by the Commission, makes significant changes to the way European funds are planned, managed and monitored. Those changes, they said, come with risks that have not been fully addressed.
REVENUE GAP A KEY CONCERN
Among the most pressing concerns raised by the ECA is the risk of a funding shortfall if the new revenue sources Brussels has proposed are not approved by member states.
The auditors warned that failure to secure those new income streams could lead to a “significant budget deficit”, which would force either an increase in national contributions or a scaling back of the budget’s overall ambitions.
The new MFF is being designed at a time when the EU is under pressure to fund defence, climate commitments, migration management and industrial competitiveness — all of which require sustained investment. A gap in revenues would put those goals under strain.
GROWING DEBT BURDEN
The ECA also raised concerns about the EU’s increasing reliance on borrowing. The reform as proposed would deepen the bloc’s indebtedness, partly through the introduction of new lending instruments.
One such instrument is a lending mechanism of up to €150 billion designed to finance investments by member states. The auditors acknowledged the appeal of such tools, though they cautioned that a structural shift towards greater borrowing carries long-term implications for the EU’s financial position that need to be carefully weighed.
The approach draws on the model used for the NextGenerationEU recovery fund launched in the wake of the pandemic, which was the first time the Commission borrowed on such a scale on behalf of the EU as a whole.
A MEGA-FUND THAT MAY BLUR PRIORITIES
Another area of concern is the Commission’s proposal to create a large, unified European fund that would merge key policy areas — including cohesion policy and agricultural support — into a single structure.
The ECA said this kind of consolidation risks forcing trade-offs between competing priorities. Cohesion funding, which is aimed at reducing regional inequalities, and agricultural support, which underpins food production across the EU, have historically been managed under distinct frameworks with their own rules and oversight mechanisms.
Merging them, the auditors suggested, could make it harder to ensure that each area meets its specific objectives.
MEMBER STATE FLEXIBILITY: FREEDOM OR FRAGMENTATION?
The reform also proposes giving member states greater flexibility to draw up their own national spending plans under the MFF. The Commission has presented this as a way to allow governments to tailor EU funds to their particular needs.
The ECA took a more cautious view. The auditors warned that increased flexibility at national level could lead to divergences in how funds are used across the bloc and weaken the coherence of EU-wide spending. It could also, they said, distort competition between member states if the playing field for investment is not kept level.
This tension — between allowing national autonomy and maintaining common standards — has long been a fault line in debates over EU budget design.
PAYING FOR RESULTS: A FLAWED MODEL?
The ECA also questioned the Commission’s proposed approach to executing the budget. The reform draws heavily on the model used for NextGenerationEU, which ties payments to the achievement of specific milestones and targets rather than simply reimbursing expenditure.
The auditors acknowledged that this results-based approach has some merit, though they said it has real limitations. In practice, they said, it is difficult to measure whether milestones truly reflect the actual benefits delivered to citizens. The system, as currently designed, does not make it easy to assess what EU money has actually achieved on the ground.
That is a significant problem for an institution whose core function is accountability. If auditors cannot clearly evaluate the outcomes of spending worth nearly €2 trillion, the question of whether that money is being well used becomes very difficult to answer.
WHAT HAPPENS NEXT
The ECA’s report is an opinion on the Commission’s legislative proposals and does not have binding force. Negotiations on the 2028-2034 MFF are expected to run through 2025 and into 2026, with agreement requiring unanimity among member states in the Council of the European Union as well as the consent of the European Parliament.
The auditors said they hoped their findings would inform those negotiations and help legislators address the risks identified before the new framework is finalised.
