European Union institutions have started talks on the implementation of the huge Recovery package that is linked to the next Multiannual financial framework (MFF) 2021-2027. The aim is also to conclude an agreement with the European Parliament, which demands significant improvements to the plans agreed on in the last four days European Council from 17 to 21 of July.

The matter has been also touched upon during a telephone call on 29th July between European Commission President Ursula von der Leyen, European Parliament President David Sassoli and German Chancellor Angela Merkel, who chairs the rotating Presidency of the Council of the EU. The European Commission said in a statement that the three leaders had discussed the next steps in the adoption of the EU’s recovery package and the next Multiannual Financial Framework, stressing the aim to conclude this process within the end of 2020.

The MFF need to be approved by the European Parliament later this year. And this will not be an easy matter, despite the agreement by the member States leaders: during a plenary session of the European Parliament, several voices were raised against many of the priorities in the MFF, highlighting that they had their funding cut substantially, while other funds had been transferred to the pandemic Recovery plan.

A resolution warning that the long-term budget could be blocked unless improved was adopted by 465 votes in favour and 150 against.  “The Parliament will not rubber-stamp a fait accompli and is prepared to withhold its consent for the MFF until a satisfactory agreement is reached in the upcoming negotiations between Parliament and the Council,” reads a resolution adopted by the majority of MEPs. They disapprove the cuts made to future-oriented programmes and consider that they will “undermine the foundations of a sustainable and resilient recovery.”

Flagship EU programmes for climate protection, digital transition, health, youth, culture, research or border management “are at risk of an immediate drop in funding from 2020 to 2021″, and that as of 2024, the “EU budget as a whole will be below 2020 levels, jeopardising the EU’s commitments and priorities.” MEPs said they are “prepared to withhold their consent” for the long-term EU budget, the Multiannual Financial Framework (MFF) until a satisfactory agreement is reached in the upcoming negotiations between Parliament and the Council, preferably by the end of October at the latest for a smooth start of the EU programmes from 2021.

After a marathon EU summit in Brussels, on 21 July national leaders agreed to a 1,8 trillion euro, seven year budget and pandemic recovery fund. The summit deal has two major pieces: a 1,07 trillion euro regular budget plus a 750 billion euro pandemic recovery fund. But, despite the huge amount of money, many stakeholders highlighted that the cuts in some important sectors are a major disappointment and a breach of trust. The MFF finale figure is indeed lower than the expected budget (1,135 billion euro), and the two Horizon Europe and Digital Europe programs will also pay for it. In particular, the funds for the implementation of Horizon Europe program for the period 2021-2027 will be 75,9 billion euros, instead of the 100 billion originally planned. The Digital Europe Program, designed to strengthen the EU’s strategic digital capabilities, including artificial intelligence and cybersecurity, will be able to count on 6,76 billion euros for the period 2021-2027, almost 2,5 billion less than sums originally planned (they were 9,1 billion).

Generally speaking there are 7 areas of intervention that make up the structure of the European Budget 2021-2027: Single Market, Innovation and Digital; Cohesion, Resilience and Values; Natural Resources and Environment; Migration and border management; Security and Defense; Neighboring states and the world; European Public Administration. Furthermore, two areas that many countries want to preserve from severe cuts prospected were Agriculture and Cohesion Funds.

As it comes to the farming budget for 2021-2027 will amount to 344 billion euro, 20 billion euro more than what the EU executive earmarked in its proposal in July 2018, although significantly lower than the 2014-2020 budget which was 383 billion euro. The rural development support, considered as the Common Agriculture Policy’s second pillar, was put at 78 billion euro with an extra 7,5 billion euro coming from Next Generation EU, for a grand total of 85,5 billion euro.

This second pillar, according to “Euractiv”, remains the most hit by cuts, as the rural development aid fell by 12.8%, although this is still an improvement on the initial reduction of 28% included in the Commission’s draft. The adoption of MFF 2021-2017, for sure, has been characterized by an extremely long process: starting from the publication of the original proposal, the discussions on the new budget within the European Council have taken 26 months. By comparison, the negotiations in the European Council on the 2014-2020 MFF required only 20 months.