EU increases annual budget by almost 2%

By 418 votes in favour and 185 against, the European Parliament approved the EU’s 2025 budget on Wednesday, set at approximately €199.44 billion, representing a 1.78% increase compared to 2024. Strasbourg managed to secure over €230 million more than the European Commission’s initial mid-year proposal for the next fiscal year, directing part of this increase towards key research, development, and innovation programmes. Beneficiaries include Horizon Europe, LIFE, and the Citizenship, Equality, Rights and Values (CERV) programme, which collectively receive an additional €31 million.

Specifically, Horizon Europe, the EU’s primary funding programme for research, will see an increase of €25 million compared to Brussels’ original plan. Of this, €7.5 million is allocated to the European Innovation Council (EIC), aimed at supporting start-ups and disruptive projects, while €2.5 million is directed to the Marie Skłodowska-Curie Actions, focused on researcher training. Meanwhile, the LIFE programme, dedicated to environmental sustainability, will benefit from an additional €5 million, and CERV, promoting fundamental rights and equality, will receive an extra €1 million.

Susana Garayoa, Director of Institutional Relations at Zabala Innovation in Brussels, highlighted the importance of these increases. “Consolidating these funds is essential to ensuring Europe maintains its global competitiveness in innovation and sustainability. Horizon Europe, in particular, has become a strategic tool to foster disruptive technological advancements and support innovative businesses,” she said.

Increases in other key areas

The budget also includes boosts in priority areas such as the free movement of workers, coordination of social security systems, and training for workers’ organisations. Additionally, more funding has been allocated to the EU Civil Protection Mechanism, a vital tool for responding to emergencies and natural disasters.

In migration and border management, the agreement reached between the European Parliament and the EU Council has allowed for increased resources for border management, military mobility, and humanitarian aid—areas that were hotly debated during budget negotiations.

Extra funds for disaster management also stand out. Notably, €3 billion in advance payment credits have been allocated to support regions affected by natural disasters, including the severe flooding that caused significant damage in Spain following the dana storm. This measure aims to ease the financial burden on the most affected countries and ensure a swift response.

Next Generation funding and safeguarding Erasmus+

Another highlight of the budget agreement is funding to cover costs associated with EURI, the mechanism managing the debt increase from the Next Generation EU programme. This initiative, designed to spur economic recovery post-pandemic, has significantly raised the EU’s financial costs due to rising interest rates. However, MEPs have ensured that covering these costs will not impact key programmes such as Erasmus+, a cornerstone of educational mobility and European integration.

“The preservation of Erasmus+ in this context sends a clear signal of the EU’s commitment to future generations, as the programme promotes not only academic mobility but also talent and training for future professionals in sectors critical to EU competitiveness, as highlighted by Enrico Letta and Mario Draghi in their reports,” Garayoa stated.

A budget framed within the 2021-2027 horizon

The budget approved by the European Parliament on Wednesday, during the same plenary session that endorsed the new European Commission, is the fifth of the seven within the EU’s 2021-2027 multiannual financial framework (MFF). This framework sets long-term spending priorities, ensuring financial stability and strategic planning in key areas such as the green transition, digitalisation, and economic resilience.

Initially proposed by the European Commission in July, the budget underwent several negotiation rounds before final approval by qualified majority in the EU Council on 25 November. According to Garayoa, these negotiations reflect “the complexity of balancing member states’ needs with Europe’s strategic objectives.”

Despite the challenges, Garayoa considers the final budget a reflection of Europe’s current priorities. “The focus on R&D&I, sustainability, and social cohesion demonstrates the EU’s commitment to a balanced, knowledge-driven development model. It is a step in the right direction to tackle the global challenges Europe faces,” she concludes.