Written by Magdalena Sapała,
If you are looking for a comprehensive source of information, analysis and infographics on the preparation of the EU’s post-2020 multiannual financial plan, you are in the right place. This blog post will lead you through a collection of publications, prepared by researchers at the European Parliamentary Research Service, covering the proposals on the EU multiannual financial framework for 2021-2027 and own resources as well as all proposed sector-specific acts for new and continued programmes and funds.
Who decides about the next MFF?
The future multiannual financial framework (MFF) is high on the EU agenda once more. With the current MFF for 2014-2020 entering its final stretch, the EU has started preparing the post-2020 plan. The MFF sets the annual limits on EU commitments in different policy areas and on overall annual payments (expenditure side of the budget). It must cover at least five years. In practice, in most cases its duration has been set at seven years. This multiannual plan of spending is usually negotiated as a package, together with proposals for own resources (revenue side of the budget) and for new and continued programmes and funds.
Formally, these elements are adopted in different legislative procedures, with different roles for the European Parliament, the Council and the Commission. While the Parliament’s consent is necessary before the Council can adopt the MFF Regulation (Article 312 TFEU), it is only consulted by the Council before adopting the Own Resources Decision (Article 311 TFEU). The sectoral regulations in turn are agreed under the ordinary legislative procedure, with the Parliament acting on an equal footing with the Council (Articles 289 and 294 TFEU). In addition, although, according to the Treaties, the European Council ‘shall define the general political directions and priorities’ of the Union, and ‘it shall not exercise legislative functions’, experience of the last MFF negotiations shows that it plays a decisive role in taking decisions, including on the figures and on many detailed aspects of the spending programmes.
What has been done so far?
On 2 May 2018, the Commission presented a package of legislative proposals on the 2021-2027 MFF, on own resources to finance the EU budget and on linking the EU budget with the rule of law. The proposals were followed by a series of further legislative proposals for new and continued spending programmes and funds under the next MFF.
On 14 November 2018, the European Parliament adopted its negotiating mandate including the expectations on the post-2020 MFF and the reform of own resources. The document formed the basis for the Parliament’s mandates for legislative negotiations leading to the adoption of the EU spending programmes and funds (sectoral regulations). The parliamentary committees have been considering the negotiating mandates for 35 sectoral regulations proposed by the Commission since July 2018. Some of these were already approved in plenary, and negotiations with the Council were begun before the end of the parliamentary term. Following the May 2019 European elections, the Parliament re-established the MFF negotiating team, confirmed its determination to reach an agreement as soon as possible, and urged the Council to immediately intensify the interinstitutional talks.
The MFF package has also been examined by the Council under the direction of successive presidencies (Bulgarian, Austrian, Romanian and Finnish), mostly in the framework of the Ad Hoc Working Party on the MFF, the General Affairs Council and in sectoral working groups. The topic was also discussed by the Heads of State and Governments at the summit in June 2019. The results of the discussions so far are presented in the progress report and draft negotiating box.
Despite these efforts, a year and a half after the European Commission presented the MFF proposal, it has not proved possible to strike a deal. In a communication ahead of the European Council meeting on 17-18 October, the Commission urged Member States to speed up this work. Reaching an agreement before the end of 2019 would allow the new programmes to start on 1 January 2021, and avoid the delays that seriously hindered the implementation of previous financial frameworks.
The context of the negotiations
The preparation of the next MFF is taking place amid a broader debate on the future of Europe. The new political priorities, set out by the Member States in the Bratislava Declaration in September 2016 and the Rome Declaration in March 2017, must be translated into concrete measures, which require financial means. Therefore, one of the key questions of the debate is how to ensure the financing of the EU’s new priorities in the areas of security and defence, protection of external borders, asylum and migration policy, and climate policy. While new financial needs emerge, existing, long-standing budgetary priorities remain relevant, and some have even gained in importance. Increased resources are needed for instance for EU programmes for youth, and research and innovation. In addition, the future MFF will be the EU’s first ‘post-Brexit’ financial plan and has to take the financial consequences of the United Kingdom’s withdrawal into account.
Furthermore, the discussion on the next MFF is an opportunity to reform EU finances and re-emphasise some of the underpinning principles upon which they are built. The future EU budget, as often pointed out by the European Commission, must focus on the European added value to a greater extent, meaning that pooling resources at European level delivers results that spending at national level cannot. It has to be focused on delivering European public goods, designed and implemented with a view to enhanced performance, efficiency, agility and simplification. The other issues include extending existing links between the EU budget and the EU’s economic governance framework, as well as links between the disbursement of EU funds and respect for the rule of law.
Changes are also needed on the revenue side of the EU budget. There is broad consensus that the current own resources system needs to be reformed. It is seen as complex and opaque and encouraging Member States to focus on securing ‘fair return’, from the EU budget, rather than thinking strategically about how best to finance European public goods. However, while there is no shortage of ideas for alternative own resources that would radically simplify the system and endow the EU budget with greater financial autonomy, achieving significant reform has proven notoriously difficult.
Key EPRS publications
Publications on the proposal for the 2021-2027 MFF and Own Resources
- M. PARRY, M. SAPALA, Post-2020 MFF and own resources: Ahead of the Commission’s proposal
- A. DOBREVA, Multiannual Financial Framework 2021-2027: Commission’s proposal. Initial comparison with the current MFF
- M. PARRY, M. SAPALA, 2021-2027 multiannual financial framework and new own resources. Analysis of the Commission’s proposal
- Alessandro D’ALFONSO, Own resources of the European Union: Reforming the EU’s financing system
- Alessandro D’ALFONSO, Multiannual financial framework 2021-2027: Interim report on the Commission proposals
- Rafał MAŃKO, Protecting the EU budget against generalised rule of law deficiencies
- Magdalena SAPAŁA, Cohesion funds, values and economic and monetary union in the 2021-2027 MFF
- A. D’ALFONSO, A. DELIVORIAS, M. SAPALA, M. SZCZEPANSKI, I. ZACHARIADIS, Economic and budgetary outlook for the EU 2019
- A. D’ALFONSO, Multiannual Financial Framework for the years 2021-2027: The future of EU finances
- Legislative train schedule on the 2021-2027 MFF
- Legislative train schedule on the system of own resources after 2020
- M. PARRY, EU policies – Delivering for citizens: Future financing of EU policies
- A. D’ALFONSO, Post-2020 EU budget
- A. D’ALFONSO, Mainstreaming of climate action in the EU budget: Impact of a political objective
Publications on the sector-specific proposals (new and continued programmes and funds)
- A. WIDUTO, European Regional Development Fund and Cohesion Fund 2021-2027
- V. MARGARAS, Common Provisions regulation. New rules for cohesion policy for 2021-2027
- A. WIDUTO, Reform Support Programme 2021-2027
- F. SCHOLAERT, European Maritime and Fisheries Fund 2021-2027
- Magdalena PASIKOWSKA-SCHNASS, Creative Europe programme 2021-2027
- Cemal KARAKAS, Horizon Europe: Framework programme for research and innovation 2021–2027
- Marketa PAPE, Connecting Europe Facility 2021-2027: Financing key EU infrastructure networks
- Beatrix IMMENKAMP, A new neighbourhood, development and international cooperation instrument: Proposal for a new regulation
- Laura PUCCIO, Reform of the European Globalisation Adjustment Fund
- Marcin SZCZEPAŃSKI, Digital Europe programme. Funding digital transformation beyond 2020
- Dessislava YOUGOVA, LIFE programme for 2021-2027: Financing environmental and climate objectives
- Marie LECERF, European Social Fund Plus (ESF+) 2021-2027
- Marcin SZCZEPAŃSKI, Supporting the single market beyond 2020
- Cemal KARAKAS, EU space programme
- Denise CHIRCOP, Erasmus 2021-2027: The Union programme for education, training, youth and sport
- Vivienne HALLEUX, European territorial cooperation (Interreg) 2021-2027
- Rachele ROSSI, CAP horizontal regulation. Financing, management and monitoring of the common agricultural policy for 2021-2027
- Christiaan VAN LIEROP, Mechanism to resolve legal and administrative obstacles in a cross-border context
- Velina LILYANOVA, Martin SVÁŠEK, Instrument for Pre-accession Assistance (IPA III)
- Vera VIKOLAINEN, Establishing a programme for the environment and climate action (LIFE)
- Cemal KARAKAS, European Defence Fund: Multiannual financial framework 2021-2027
- Patrick KELLY and James MCELDOWNEY, CAP strategic plans
- Eric PICHON, A new association of the Overseas Countries and Territories (including Greenland) with the European Union
- Christian SCHEINERT, European Investment Stabilisation Function (EISF)
- M. SVASEK, EU anti-fraud programme 2021-2027
- A. DELIVORIAS, I. ZACHARIADIS, The InvestEU programme Continuing EFSI in the next MFF
- Beatrix IMMENKAMP, Nuclear Safety outside the EU
Initial appraisals of European Commission impact assessments accompanying the MFF proposals
- Esther KRAMER, European Regional Development Fund, Cohesion Fund, a cross-border mechanism and Interreg. Initial Appraisal of a European Commission Impact Assessment
- Ulla-Mari TUOMINEN, European Social Fund Plus and European Globalisation Adjustment Fund
- Katharina EISELE, Launching the Digital Europe programme
- Vadim KONONENKO, Establishing the Neighbourhood, Development and International Cooperation Instrument
- Stefano VETTORAZZI, Establishing the Connecting Europe Facility 2021-2027
- Vadim KONONENKO, Establishing the European Defence Fund
- Ulla-Mari TUOMINEN, Establishing the InvestEU programme
- Esther KRAMER, Reform Support Programme
- Katharina EISELE, Promoting the Rights and Values, Justice, and Creative Europe programmes
- Vera VIKOLAINEN, Establishing the European space programme
- Hubert DALLI, The Horizon Europe framework programme for research and innovation 2021-2027
- Mari TUOMINEN, Establishing the single market programme
- Hubert DALLI, The migration, borders and security cluster of the 2021-2027 MFF
- Vadim KONONENKO, Establishing the ‘Customs’ programme 2021-2027
- Esther KRAMER, Establishing a European Investment Stabilisation Function
- Laura ZANDERSONE, European Maritime and Fisheries Fund 2021-20
- Vera VIKOLAINEN, Modernising and simplifying the common agricultural policy
- Vera VIKOLAINEN, Establishing a programme for the environment and climate action (LIFE)
- Laura ZANDERSONE, Erasmus 2021-2027