This was supposed to be an EU summit about the EU’s long-term budget. But things are never easy for EU leaders, and world events have a nasty habit of making their way onto the itinerary.

That meant this European Council had a lot more on the agenda than the last handful of summits, at least: Energy, migration, enlargement, Ukraine, and more besides were covered — and very little, if anything, was decided.

Have FOMO because you weren’t there? Don’t worry, we’ve got you covered. Here’s POLITICO’s rapid roundup of what we learned at the European Council.

1) Energy stole the show right out of the gate

The summit’s first major clash came Thursday morning, with EU leaders split over whether to delay ETS2, the bloc’s second phase of carbon pricing, to address high energy prices, triggering a three-hour-long standoff.

Italy and Greece joined the Visegrád Four — Czechia, Hungary, Poland and Slovakia — in calling for a delay, a push rejected by the majority of countries.

The debate dragged on, delaying lunch (spare a thought for our hungry leaders!) and leading to the cancellation of a press conference on Thursday night.

2) Budget negotiations are a marathon…

Negotiations on the bloc’s next long-term budget were expected to be one of the summit’s most contentious topics. But they were a nothingburger, with most leaders repeating positions they have held for months. The summit brought them no closer to a breakthrough.

Many countries, of course, want a smaller budget, with Swedish Prime Minister Ulf Kristersson telling reporters that his country is “not an ATM for the EU.”

Belgian Prime Minister Bart De Wever, meanwhile, said he had no choice but to be frugal at the European level, arguing he is used to tightening his belt at home because his wife is Dutch. Think of Bart next time your Dutch friends ask you to pay them back for that coffee.

3) … and a sprint

European Council President António Costa is still aiming to get a budget deal before the end of the year, according to two EU officials. He announced that leaders will hold a special summit at the end of November to try and make progress (and there’s a December summit too). But that timing leaves them up against the clock to reach a deal by year’s end.

See you all back here on Nov. 26!

4) EU leaders may need to bring extra luggage next time

If leaders do hope to agree on the EU’s long-term budget this year, they should prepare for long negotiations in November and December.

German Chancellor Friedrich Merz suggested the pre-Christmas summit could last longer than the scheduled two days. “For the December summit, we should pack a few more shirts than usual,” he said. Gulp!

5) Your next holiday to Cyprus might be a little easier

Cypriot President Nikos Christodoulides told reporters he hopes EU leaders will discuss his country’s bid to join the Schengen travel zone at the December summit.

“All technical preparations have already been completed, and we hope that the matter will be discussed by the relevant council in December so that the final political decisions can be made,” he said.

6) Rose-colored glasses have come off when it comes to Costa

European Council President António Costa drew the ire of some leaders over his handling of negotiations to curb high energy prices, which had become a “mess,” three EU diplomats told POLITICO, with another two diplomats saying that leaders were fuming at Costa for allowing talks to go off the rails.

7) Drink (a little) less beer to help Ukraine

Ahead of the summit, Latvian Prime Minister Andris Kulbergs told reporters that supporting Ukraine costs each European the equivalent of one beer a year.

“That one beer is just a cost [for EU citizens]. There, it’s a cost of life. We drink less, their lives are saved,” he said. “Simple as that.”

He didn’t say whether he meant a beer bought in Stockholm or Prague. As anyone in Belgium knows, not all beers are created equal — or cost the same.

8) The EU Parliament wants you to know it matters too

The European Parliament’s two lead negotiators on the EU budget made the rounds of the press room to make sure journalists heard their views. Siegfried Mureșan (of the European People’s Party) and Carla Tavares (Socialists and Democrats) both stressed that the Parliament’s position is important.

Meanwhile, European Parliament President Roberta Metsola joined leaders for the first part of the summit. Metsola said she had made it clear to them that “the Parliament is not a rubber-stamp and never will be.”

9) Talking China (without mentioning China)

Leaders discussed trade imbalances (read: China) over lunch on Thursday and welcomed the deal the European Commission struck with China last week to curb imports of Chinese hybrid vehicles. Czech PM Andrej Babiš even went so far as to call the deal “fantastic.”

POLITICO scooped that the European Commission is expected to work on trade measures tackling imports of chemicals and industrial machinery in an effort to protect European industry from unfair Chinese competition.

10) New bromance brewing

Hungarian PM Peter Magyar posted a late-night selfie with Dutch PM Rob Jetten on social media after day one of the summit. The two were all smiles and “tired, but not sad”, as Magyar put it in his tweet.

In reaction to the tweet, Jetten told reporters, “We are more or less of the same generation and a tad more direct and pragmatic than some colleagues in the European Council, so there’s a click.”

We started at 7:30 this morning in Brussels. The second shift begins after 10 PM, with Dutch Prime Minister Rob Jetten @MinPres.
Tired, but not sad. pic.twitter.com/dmtSMbqG4m

— Magyar Péter (Ne féljetek) (@magyarpeterMP) October 15, 2026

11) Back to the castle

António Costa announced that another competitiveness summit at Alden Biesen castle in the Belgian countryside will take place in February 2027, three EU diplomats told POLITICO.

Leaders already visited the castle earlier this year, and they clearly loved the Belgian countryside so much they want to return (or Costa is forcing them to go).

12) Still reeling from Ceuta

Ahead of Friday’s talks, 16 EU leaders met to discuss migration over breakfast (before discussing migration over lunch with everyone else).

According to one EU diplomat, leaders broadly agreed that the EU should be able to suspend asylum applications when faced with a sudden influx of migrants that may have been engineered on purpose. But would that mean the EU will implement pushbacks (which are banned under EU law)?

13) Denmark, Italy and Poland want to be tougher on migration

The three leaders joined forces to argue that migration is a concern for many EU citizens and is contributing to rising crime rates. That caused a delay to an already shockingly long summit.

14) There were some agreements

Italy’s Giorgia Meloni and Spain’s Pedro Sánchez found some time on the sidelines of the summit to chat about Rome’s restrictions on Spanish nationals sparked by the Ceuta crisis.

Plus, France and Germany said they had struck a deal to favor European-made cars under the Industrial Accelerator Act in exchange for weakening a 2035 vehicle emissions target, ending months of wrangling between the bloc’s two biggest economies.

15) EU leaders get the good stuff to eat

Thursday’s lunch menu featured a “full-flavored vegetable jus.” Not a little flavor, not a medium amount of flavor, but the full flavor. Then on Friday there was a “rich jus”. There was also a Champagne sauce. Only the best for our leaders!

16) The same can’t be said for reporters

Some POLITICO journalists lamented the lack of vegetarian options at the Council canteen. Pray for us.

17) No harsh words from EU to Zelenskyy

At a press conference on Friday afternoon, Volodymyr Zelenskyy was asked whether EU leaders had expressed annoyance at his recent tone toward U.S. President Donald Trump. The question followed reports that some capitals were frustrated with him and worried he was further riling the White House.

But it was all love from Zelenskyy, who said there had been no harsh words during his time in the summit room. “I heard from my European colleagues support and only support, and I’m grateful for this,” he said.

18) No hugs for Fico

As Zelenskyy entered the European Council building, he was seen hugging and kissing fellow leaders — with one exception: Slovakia’s Prime Minister Robert Fico received no hug. That may well have been because Slovakia is preparing to revive a dormant cooperation forum with Moscow.

19) 20M Ukrainians could flee to Europe if Russia wins war

Zelenskyy issued a stark warning to Europe: if Russia wins the war, as many as 20 million Ukrainians could be forced to flee to Europe. Over 4 million Ukrainians already live in EU countries under temporary protection status, according to Eurostat. 

20) EU leaders have forgotten about Britain … or have they?

There was plenty of talk across the Channel this week about the U.K. potentially rejoining the bloc, but the subject did not come up at the summit, even with an EU-U.K. summit due next month. EU leaders have more pressing issues on their minds.

Still, some had things to say about the U.K.’s relationship with the EU. Foreign policy chief Kaja Kallas said “all our friends are welcome to join,” naming Britain alongside Canada, Norway and Iceland as partners seeking closer ties.

Latvian Prime Minister Andris Kulbergs suggested the U.K. “should come back to the family,” although he also said that Russia “had its hands on Brexit.”

21) At POLITICO, we save the best for last

Covering European Councils often involves a lot of waiting around, but during this summit conditions were a little tougher because of a phantom farter among reporters waiting for Zelenskyy’s press conference. POLITICO went viral in Brussels’ diplomatic and journalistic circles for reporting the hard facts on our live blog.

While this summit’s agenda was packed, in the end not many concrete decisions were taken. Some might say the summit was a load of hot air.

BRUSSELS — EU leaders will go back to the drawing board in November as they race to finalize a deal on the bloc’s next seven-year budget by the end of the year.

During the first day of a two-day summit in Brussels on Thursday, European Council President António Costa announced he was convening an additional gathering on Nov. 26 in a bid to overcome disagreements and lay the ground for a final deal in December. To bring the sides closer to an agreement, he will present new budget figures before the meeting, according to an EU official, who was granted anonymity to discuss the confidential planning.

Costa is pressing leaders to finalize negotiations by the end of the year — before elections in France, Italy and Poland in 2027 threaten to derail the talks.

In a speech to the leaders, Costa warned that going past the end-of-year deadline will delay EU payments to farmers and researchers past Jan. 1, 2028, when the new budget is scheduled to come into force.

If leaders fail to reach a deal in December, the electoral calendar might push an agreement to May or even October 2027, Costa warned leaders in his concluding remarks, according to two EU diplomats briefed on the discussions.

Pressure on governments

Costa’s plan received a major boost on Thursday from French President Emmanuel Macron, who told fellow leaders that he won’t have a political mandate to sign a deal close to the French presidential elections in April 2027.

This is a major reversal for France, which has previously been unwilling to commit to the end-of-year deadline.

Macron’s words put more pressure on governments to advance the talks over the coming weeks — although some cast doubt on his good intentions.

“There are so many elections next year. [French far-right leader Marine] Le Pen herself [said] it’s undemocratic if we were now to agree,” said one EU diplomat.

Just hours before the leaders’ gathering, Le Pen renewed calls to halve France’s contributions to the EU budget if she wins the presidential elections next year.

She said that rushing the budget agreement before the French elections would be “a democratic scandal.”

The new frugal

Costa is stuck between messy domestic politics across Europe and hardening stances among the EU’s 27 leaders.

The so-called frugal EU countries pushing for major budget cuts — Germany, Netherlands, Austria, Sweden, Denmark and Finland — have publicly said that an Irish proposal envisioning €159 billion cuts doesn’t go far enough.

On Thursday, the six hardliners were joined by Belgian Prime Minister Bart De Wever, who joked in a press conference after the summit that “I’m married to a Dutch person so I’m very frugal also in my personal life.”

However, behind closed doors the budget hardliners employed a more conciliatory tone.

German Chancellor Friedrich Merz — the unofficial leader of the frugal camp — said that the Irish proposal has achieved progress despite reductions still being needed, said two EU diplomats briefed on the discussions.

He pointed to EU payouts to poorer regions, as opposed to farmer’s subsidies, as an avenue for cuts.

On the other side of the spectrum, Spanish Socialist Prime Minister Pedro Sánchez — who will try to cling on to power in an election on Nov. 29 — insisted that the budget is way too small.

“It is a distribution of misery,” he told fellow leaders during the discussions, according to the diplomats. He was joined by Italy’s right-wing Prime Minister Giorgia Meloni — an ideological foe on most issues, but an ally of sorts in the budget battle. She insisted that no further cuts to the budget will be accepted.

To bring sides together closer to a deal, Costa promised to advance progress on EU-wide taxes, or own resources, to finance the next seven-year budget and reduce national contributions.  

He will explore the European Parliament’s proposed taxes on crypto firms, online gambling and tech giants as well as a Greek idea to funnel future national sales of 6G mobile spectrum to the EU budget.

But given the level of opposition, getting EU countries to agree to any of these options will no be no mean feat.

“It is time to be realistic and work on what is plausible and reasonable, instead of wishful thinking,” said another EU diplomat.

BRUSSELS — Ukrainian President Volodymyr Zelenskyy will make a direct pitch to European leaders for more help on Friday, amid a crisis of faith among allies over Donald Trump’s latest steps favoring Russia. 

At the second day of an EU summit in Brussels, Zelenskyy joins European prime ministers and presidents as they discuss Ukraine’s need for more weapons and cash, with concern growing that Kyiv faces a shortfall of billions of euros next year. 

The reality of the threat to European security from the four-year-long war penetrated the summit bubble after air drones hit two ships in or near Romanian waters, prompting emergency talks with NATO.

“We all in Europe want this war to end,” Zelenskyy said on social media as he arrived in the Belgian capital on Thursday. “And for that, signals of strength are needed — more real pressure on Russia and more defense support for Ukraine.”

It is especially important, Zelenskyy said, to “act together to protect lives.” But unity among European leaders is in short supply at a meeting already riddled with tensions. 

EU governments are pitted against each other in their own fraught negotiations over how much money to commit to the 27-country bloc’s budget. With populists surging, discontent raging and elections scheduled in major power centers across the continent, under-pressure leaders are a long way from approaching a deal.

That’s the combustible mix of financial discussions the U.S. president waded into.

Trump’s decision to open up American markets to previously banned Russian diesel — intended to ease price pressures in the U.S. — risks tilting the balance of an expensive war in Russia’s favor, three European officials warned. Putin’s war chest can now swell from additional fossil fuel exports, while Ukraine struggles for cash. 

As they arrived for the first day of the marathon two-day gathering on Thursday, EU national leaders began informally discussing options for how to help redress the balance. That discussion should to be picked up again around the summit table on Friday.

Russian assets

One idea rapidly rising back up the agenda is the fraught question of whether, or how, to make use of some hundreds of billions of euros of frozen Russian financial assets held in European banks. 

The bulk of these rest with the Euroclear depository in Brussels. A previous attempt to grab the funds and send them directly to Kyiv was blocked by the Belgian government ― and other countries less prominently ― over concerns it would be exposed to legal action. 

But Sweden, Finland and Germany want to take another look at the assets. The European Commission is to come up with a new detailed assessment of Ukraine’s funding needs and an options paper on how to help, including the use of assets, according to officials from these countries. 

As the summit began, German Chancellor Friedrich Merz said he had been urging his counterparts to “do everything we can to help Ukraine get through the winter and continue to support it next year as well.” 

“We will also have to increase funding once again in order to provide Ukraine with truly long-term assistance,” he said. “I remain firmly convinced that we are not only defending Ukraine’s territorial integrity, but also the political order of Europe, which is truly under pressure from Russia in every respect.” 

A German official earlier suggested that of the available options to help Ukraine, including a loan and direct grants from national governments, using the assets was the most viable way forward and should be “discussed.”

A U.S. proposal to unfreeze some of the Russian assets and transfer them to a U.S.-controlled entity so Washington could use them as leverage in peace talks with Moscow also attracted strong criticism.

Merz told reporters that the assets had been frozen in Europe and “should remain frozen in Europe … That is our business, and we will decide on it.”

‘Try again’

Finland’s Prime Minister Petteri Orpo told POLITICO as the summit began: “The best solution would be that we will have a solution on how to use frozen assets … We have to try again.” 

Sweden is also backing the move to re-examine options on using the assets to help Ukraine’s future funding needs. “Doing nothing is not an option,” Swedish EU Affairs Minister Jessica Rosencrantz told POLITICO. “The Commission is looking into different financial options, and we need to get them on the table quite soon,” she said. 

Leaders at this week’s summit should “be really honest that Ukraine needs increased financing” and that the EU “must really step up,” she added.

Zelenskyy met Belgian Prime Minister Bart De Wever, the main opponent to a deal on assets, for talks on Thursday and thanked him for his country’s support so far.

Speaking to reporters after the first day of the summit, De Wever said the assets should be looked at as part of a future peace agreement. “Are there people on this planet who maybe dream of doing it differently this time and operationalizing those assets earlier for certain purposes? The answer to that question is: Yes there are,” he said. “Are they in this building? They are. Are there outside this building? Yes there are. Do I want to talk about it? No, I don’t.”

For Finland’s Orpo, Trump’s “terrible deal” with Putin on diesel, and the apparent U.S.-imposed limits on Starlink technology to help Ukraine counter Russian attacks, are hard to understand.

“My message to [Trump] is that we are allies,” Orpo said in an interview. “We are in NATO. And what is the biggest threat against NATO? It’s Russia — and that is why there is no logic. I don’t have answers. I have many questions.” He said Trump may be focusing on winning votes ahead of next month’s midterm elections in the U.S. but he should remember that his real allies lie in Europe and he should not “trust” Putin. 

Election anxiety

Finland holds its election next year at the same time as what could be a seismic contest in France. Far-right leader Marine Le Pen is leading the polls for the French presidency and wants to cut aid to Ukraine and slash the EU’s budget. 

French President Emmanuel Macron, who is constitutionally barred from standing next year, warned EU leaders that they must get a deal on the bloc’s next budget by December, otherwise it will be too late. 

But the 27 leaders remain split and show no signs of bridging the gap between “frugal” countries like Germany, Sweden and the Netherlands, who want to limit the settlement, and others such as Italy and Romania, who are on the side of bigger pots of cash for regional development and farming. 

European Council President António Costa also sees the urgency. He believes a deal before the end of the year is not only necessary but achievable, according to two EU officials.

Costa, who is taking over the negotiations from Ireland in its role at the helm of the rotating presidency of the Council of the EU, believes failing to secure a deal by December would push the entire budget negotiating process beyond the electoral cycle. That would potentially delay a deal until October next year — perilously close to the new EU budget taking effect in January 2028. 

In an effort to make progress on the budget talks, EU leaders will return to Brussels for an extra summit next month.

Camille Gijs, Hanne Cokelaere and Gregorio Sorgi contributed reporting.

BRUSSELS ― António Costa is supposed to be the dealmaker who brings European leaders together. Increasingly, his efforts are going unrewarded.

At a summit of the bloc’s national leaders on Thursday, Costa — who, unlike most of the EU’s current big beasts, is a Socialist — suffered his most stinging criticism since taking the role of European Council president nearly two years ago. The ire centered on his handling of unrelated negotiations over curbing energy prices and the EU’s next seven-year budget.

Governments were looking for both debates to show signs of progress at the two-day gathering, which was scheduled to continue on Friday. What they got was, at best, stalemate ― at worst, mounting division. And a day of talking that dragged on for 14 hours with little to show for it.

The longer budget negotiations last, the “more difficulties we will have,” Finnish Prime Minister Petteri Orpo told POLITICO. “So we have to work to find a solution this year. I understand very well that it is difficult. A huge challenge.”

The stakes could barely be higher. The EU is desperate to ease the cost of living crisis and get a deal on the budget before national elections next year make finding an agreement much tougher. Disunity between the bloc’s 27 members looks even starker when Donald Trump makes moves to take Russia’s side in the Ukraine war, the economy is struggling to match the might of China and anti-EU nationalists get closer to power in Europe’s biggest capitals.

All 16 diplomats and officials who POLITICO spoke to for this article were granted anonymity to allow them to speak on a sensitive issue. They were all either in the summit room on Thursday or were immediately briefed by leaders who were. While most were critical of Costa, others spoke more positively.

Costa’s spokesperson declined to comment.

Bogged down

Costa, a former Portuguese prime minister, is appointed by leaders to chair their summits and corral them into agreement. As Brussels Playbook reported on Thursday, EU officials judge he’s entering a defining period of his presidency, racing against time to overcome huge divisions on the budget. He is widely expected to push for reappointment for a second two-and-a-half-year term next year, officials said.

Thursday’s summit was dominated by discussions unraveling on the second phase of the bloc’s carbon pricing regime, known as ETS2.

The showdown over the Emissions Trading System — both the current one, and the second iteration which is already legislated and will put a carbon price on heating and transport from 2028 — became so bogged down it forced Costa to cancel the summit’s planned press conference and delay further talks until after dinner, because they had become a “mess,” three EU diplomats told POLITICO.

With German Chancellor Friedrich Merz incensed by what Berlin saw as his Italian counterpart Giorgia Meloni’s intransigence, fiery negotiations pitted a coalition made up of Germany, Spain, France, Portugal, the Nordics and the Netherlands against a stubborn bloc of Italy with Hungary, Czechia, Slovakia and Poland (known as the Visegrád Four). Rome and the V4 group wanted the EU to postpone ETS2 because of the burden it would place on energy bills, according to five diplomats.

Leaders were fuming at Costa for allowing talks to go off the rails, two EU diplomats from different member countries said. While the pre-summit conclusions didn’t point to any rethink of ETS2, the countries tried to unpick the legislation in the summit room, leaving Costa flustered, one of them said.

Costa “wants to have conclusions ready from [pre-summit meetings of ambassadors] and not to open them during EUCO,” the diplomat said. “He is not a fan of drafting on the spot.”

Another said there was “huge frustration,” calling the tug-of-war over the wording of the energy policy “insane chaos.”

“They just went on with Italian drafts and disregarded texts that were handed in before by others, seemingly not understanding the political nuances of the whole ETS discussion,” they added.

Another accused Costa of “losing control of the room,” saying he had failed to keep track of proposed amendments and present them to EU leaders in time for the discussions. As a result, leaders were left debating without them, contributing to negotiations going on past midnight.

One diplomat and one EU official separately compared Costa with his immediate predecessors, Charles Michel ― who governments frequently criticized for a lack of dealmaking know-how ― and Donald Tusk, who enjoyed broad support throughout his term in office.

Costa performed “worse than Charles Michel” on Thursday, the diplomat said. The official said “there is frustration that things are not being dealt with a bit more Tusk-style.”

Honest broker

The annoyance went beyond the energy debate. While governments weren’t expecting a breakthrough on the EU budget on Thursday, they have started raising questions about Costa’s handling of that topic too.

Costa is determined to secure an agreement by the end of the year. In his job, the Council president must act as a honest broker and facilitate a deal among 27 governments.

Northern EU countries are worried he’s favoring southern countries, according to a further four EU diplomats.

One EU diplomat accused Costa of being two-faced and not acting as an honest broker in the budget negotiations.

Another diplomat, from a country that wants the budget to be smaller, said: “Costa personally and politically belongs to the other camp.”

“There is some skepticism on how he will take the process further from here,” they said. The so-called frugal countries are calling on Costa to propose further cuts ahead of a special EU summit on the budget that was confirmed Thursday for Nov. 26.

‘Superb deal maker’

Many governments still believe Costa may succeed over the long term. Even those who acknowledge that his honeymoon is over ― a period when he was roundly praised for being a safe pair of hands and avoiding diplomatic faux-pas ― retain faith in him.

Belgian Prime Minister Bart De Wever defended Costa as “capable” and “shrewd” after the first day of the summit — praising the Council president for largely avoiding drafting on the day, unlike Michel.

Costa “avoids negotiation about the wording on the table which happened all the time under his predecessor and which annoyed the hell out of everybody because then you are here until three o’clock to discuss about syllables, commas and words that the next morning you cannot see the difference anymore,” De Wever said. “You don’t even know anymore what you are negotiating about.”

Other diplomats said the disarray wasn’t Costa’s fault, and blamed the leaders who tried to unpick the energy legislation, notably Meloni. “He did not want to reopen the conclusions, it was the V4 and Italy who did so,” one said. “I don’t see what he could have done differently.”

Another EU official defended the sheer difficulty of the task faced by the Council president. “Discussing drafting at leaders’ level is not the most straightforward thing in general.” On energy, the official said leaders wanted to have “proper consideration” of the different proposals by countries, which had “opposing interests.”

One of the diplomats more critical of his political leanings on the budget said Costa was “impeccable” in his behavior. “He’s a superb deal maker.”

The next few weeks will show how true that turns out to be.

Hanne Cokelaere, Camille Gijs, Sebastian Starcevic, Gerardo Fortuna and Hans von der Burchard contributed to this article.

BRUSSELS — French president Emmanuel Macron warned fellow EU leaders they need to get a deal on the bloc’s seven-year budget by the end of the year because it’ll be too politically difficult after that, four European diplomats said.

His words rachet up the pressure on the EU to overcome their significant differences over the coming weeks.

During a closed-door discussion on Thursday evening, Macron said he wouldn’t have a political mandate to sign a deal close to the French presidential elections in April 2027, the diplomats, all briefed on the conversation, said.

Macron “said that, starting from January, there will be no political room” for concluding an agreement, one of the diplomats said.

The EU’s 27 governments are divided over the total size of the 2028-2034 budget. Leaders gathering in Brussels are discussing the Irish plan, which envisions cuts of €159 billion in current prices to the Commission’s nearly €2 trillion proposal. 

European Council President António Costa is pushing leaders to finalize negotiations during a summit in December — before elections in France, Italy and Poland in 2027 threaten to derail the talks — but some governments and EU officials have said such a timeframe is very unrealistic.

One EU diplomat dismissed Macron’s intervention as a threat to support Costa on the December deadline. “EU would be ungovernable if we were to take into account all the local elections,” they added.

French far-right leader Marine Le Pen, who is leading the polls to replace Macron, pledged to halve France’s contributions to the EU budget if she comes to power.

During a press conference in Brussels on Wednesday, Le Pen accused the EU of speeding up talks to prevent France’s next leader to have a say.

Several leaders are unwilling to commit to the end-of-year deadline, fearing that time pressure will undermine their leverage in the negotiations.

“We will not sign an agreement that is not beneficial to us just to meet a deadline,” Italian Prime Minister Giorgia Meloni told the country’s parliament on Wednesday. “We will sign an agreement only when it is right for Italy.”

Une rude bataille s’engage pour faire adopter le prochain budget de l’Union européenne. Non seulement les 27 pays sont divisés sur son montant et sur ses priorités mais plusieurs élections nationales compliquent l’équation politique. En amont du sommet du Conseil européen de jeudi et vendredi, Marine Le Pen s’est d’ailleurs rendue à Bruxelles pour mettre en garde contre la conclusion d’un accord avant le scrutin français. Que se joue-t-il réellement avec ces discussions ? La demande du RN de repousser l’adoption du budget est-elle justifiée ? Marine Le Pen propose-t-elle une sortie déguisée de l’UE en voulant couper dans la contribution française ? Anthony Lattier en discute avec Marion Solletty et Giorgio Leali, journalistes à POLITICO.

EU leaders meet today for their first chance to beef about the budget face to face.

On the show, Zoya Sheftalovich and Sarah Wheaton dive deeper into why leaders look increasingly unlikely to reach an agreement on the EU’s next money pot by December. Plus, Zoya obtained a document revealing deepening relations between Russia and Slovakia. Will that be a cause for concern around the Council table?

Next up, Zoya spoke with Defense Commissioner Andrius Kubilius on stage yesterday. His main message? Europe should boost its defense capabilities and stop relying so heavily on U.S. military support.

And finally, ECB President Christine Lagarde plugged her upcoming memoir at a press conference … is she allowed to do that? 

If you have a question or comment, don’t hesitate! message us on our WhatsApp here or at +32 491 05 06 29.

Articles mentioned in this episode:

• “How to watch the EU leaders’ summit like a pro.”
• “Slovakia deepening ties with Russia, document shows.”
• “Lagarde’s book plug raises questions about ECB ethics standards.”
• “Weakened Macron and Merz sink hopes of a quick EU budget deal.”

Die Berliner Landespolitik manövriert sich erst in eine Sackgasse und will nun doch daraus rausfinden. Wegen des Streits um antisemitische Strömungen in der Linkspartei stehen die Sondierungsgespräche mit SPD und Grünen auf der Kippe, werden aber heute fortgesetzt. Wie sich das rot-grün-rote Bündnis gegen den Widerstand von SPD und Grünen im Bund retten will, zeigt Maximilian Stascheit auf.

Auch die Bundes-SPD kämpft mit schlechten Umfragewerten und internem Frust vor dem anstehenden Parteitag im Dezember. Im 200-Sekunden-Interview erklärt der nordrhein-westfälische SPD-Fraktionschef Jochen Ott, warum seine Partei eine neue Vision braucht und wie der Weg aus der Krise aussehen soll.

Beim EU-Gipfel in Brüssel steht Europa derweil vor einem massiven Realitätscheck in der Ukraine-Politik. Die US-Unterstützung bröckelt spürbar. POLITICO-Experte Hans von der Burchard ordnet ein, welche Forderungen Wolodymyr Selenskyj morgen mitbringt und warum der Streit um den EU-Haushalt weitere Hilfen zu blockieren droht.

Das Berlin Playbook als Podcast gibt es jeden Morgen ab 5 Uhr. Rixa Fürsen, Maximilian Stascheit und das POLITICO-Team liefern Politik zum Hören – kompakt, international, hintergründig.

Für alle Hauptstadt-Profis: Der Berlin Playbook-Newsletter bietet jeden Morgen die wichtigsten Themen und Einordnungen. Jetzt kostenlos abonnieren.

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BRUSSELS — The EU border agency Frontex is suspending a support program for deported migrants after its budget for the year ran out earlier than anticipated, emails seen by POLITICO show. 

The border agency paused new applications for reintegration support under its program on Oct. 2 after estimating that costs had “reached a level that does no longer ensure full financial coverage,” according to an email sent by Executive Director Hans Leijtens to staff on that date.

The program, which has operated since 2022, offers financial assistance, healthcare, vocational training and counseling to people who are returned to their home countries after being refused the right to stay in the EU. Reintegration support forms part of the EU’s plan to boost returns of unsuccessful asylum-seekers.

The suspension comes as the EU seeks to step up deportations from the bloc — a leading pillar of EU migration policy, and the object of new legislation adopted earlier this month — and weeks before the European Commission is expected to propose expanding the mandate of the border agency, including its role in returns and reintegration.

Frontex cannot resume the program without additional cash. The agency asked the Commission for more funds, but is waiting for clarity on the EU budget for 2027, and the next seven-year budget starting in 2028, the emails said.

“There is no point in talking about a more ambitious European return policy without also talking about the resources needed to deliver it,” Frontex spokesperson Chris Borowski told POLITICO. “Ambition and funding have to go hand in hand.”

Borowski confirmed that the agency had suspended new cases, but stressed that individuals already been accepted into the program wouldn’t be affected and that Frontex would also continue to offer EU countries “other forms of assistance” on returns, such as operational and technical support.

“Returns do not end when a plane lands. Helping people rebuild their lives after returning to their home countries is an important part of making migration management work. It takes planning, people and money,” he said.

With 2,368 new cases per month on average, the agency took on significantly more migrants seeking reintegration support than it expected. Cases in September were 63% higher than Frontex’s target, according to Leijtens’ email to staff. In the first half of this year, the agency took on around 75% more cases than it did in the same period last year.

In previous years, Frontex was able to assign additional funds from other parts of its budget, the email says — signaling the agency has had to search to find the cash to keep the program running in the past.

“Frontex does not have the necessary appropriations to cover the needs further as MFF allocations did not consider that Frontex would be expected to take over EURP funding at the scale we have seen today,” Leijtens wrote, referring to Multiannual Financial Framework, the EU’s seven-year budget.

The agency has raised the issue with the Commission but “no further commitments could be made onwards,” according to the email.

The program’s suspension raises questions about the future of the bloc’s migration approach. Reintegration is “the key ingredient” to making the EU’s returns strategy work, Lukas Gehrke, the director of the U.N.’s migration organization’s global office in Brussels, told POLITICO.

Forced returns are expensive and come with a higher risk of human rights infringements, whereas reintegration support boosts voluntary returns, reduces people’s propensity to attempt to reach the EU again, and tends to ease cooperation with the country to which they return, he argued.

“That means every euro spent on return with reintegration is a euro spent in a more sustainable way,” Gehrke said.

‘Do not argue or defend the EU policy’

In emailed guidance on how to communicate the suspension to migrants who applied for support, seen by POLITICO, staff were told to “acknowledge the institutional problem” with reintegration program funding “so the returnee does not feel personally targeted or punished.”

Counselors should be transparent, validate migrants’ disappointment, wait for their emotions to pass and shift the conversation to what they could still do upon their return, the guidance read, advising: “Do not argue or defend the EU policy.”

Potential returnees “may feel deceived, leading to anger, despondency, or complete withdrawal from the return process,” it also warned.

Expanding the agency’s Frontex mandate featured in the Commission’s five-point plan to address sudden mass movements of people, in the aftermath of migration crisis in the Spanish exclave of Ceuta. Besides stepping up the agency’s role in returns and reintegration, the plan also noted an intention to charge Frontex with monitoring the bloc’s external borders and add capacity to quickly deploy forces in the event of an emergency.

“The Commission will propose that Frontex becomes a genuinely European capability with the scale, tools and agility to support Member States wherever and whenever needed,” Commission President Ursula von der Leyen wrote in a letter to EU leaders ahead of a summit on Thursday and Friday, where migration is likely to be a flashpoint.

The plans have already raised concerns that the border agency’s mandate is being expanded more quickly than its resources.

Strengthening the border agency’s emergency response capacities, for example, comes with a tradeoff as staff that can be deployed on a moment’s notice cannot be deployed elsewhere, Leijtens, Frontex’s executive director, said at an event earlier this month.  “If they’re in Narva in Estonia, you can’t use them in Italy right now.”

Zoya Sheftalovich contributed to this report.

BRUSSELS ― Political pressure is leaving Emmanuel Macron and Friedrich Merz poorly placed to break the deadlock over the EU’s next seven-year budget.

As EU leaders gather for a two-day summit in Brussels from Thursday, the heads of the bloc’s two largest countries hold the keys to breaking the impasse between capitals that has persisted for months, as a Germany-led group advocating a smaller budget clashes with those like France which are resisting reductions.

“Delays and persisting divisions in the Council [representing EU governments] are worrying,” said Siegfried Mureșan, co-leading the European Parliament’s work on the MFF, the multiannual financial framework. “The EU budget can only be built through compromise … The faster we adopt the budget, the faster we can implement it and become more competitive, safer, help farmers and researchers and protect our borders and cyberspace.”

Sealing agreement on the EU’s long-term central budget, worth approximately €2 trillion, is the biggest challenge over the next few months facing leaders, all of whom must sign up to the final numbers. While it isn’t just up to Macron and Merz, getting the chiefs of the bloc’s two most powerful countries to overcome their differences would be a massive step in making all the pieces of the jigsaw slot into place.

But with Macron soon to leave office and Merz under severe pressure domestically, officials and diplomats in Brussels, Paris, and Berlin are playing down hopes of a Franco-German breakthrough this week.

“If the French and German leaders come hand in hand, I think that could change the game,” an EU diplomat, granted anonymity to speak frankly, said. “You need [Italian Prime Minister Giorgia] Meloni and [Polish Prime Minister Donald] Tusk, but it starts with Merz and Macron.”

While Merz and Macron may talk bilaterally during the summit, according to an Elysée official, there were no firm plans for a more formal sit-down, two EU diplomats said, adding they were expecting them to use the two-day meeting to hash out positions.

Domestic political weakness makes both leaders less likely to yield ground, three EU diplomats said.

Backfiring

For the French president, who leaves office next year, the fear is that making big concessions — like accepting cuts demanded by Berlin — could be weaponized by presidential candidates vying to replace him.

“Macron should not appear too conciliatory” in budget talks, said an ally of the French president. “It would backfire in the presidential campaign.”

Indeed, Macron may be wary of striking a deal that could lead to attacks from far-right leader Marine Le Pen or far-left rival Jean-Luc Mélenchon, both of whom argue that France receives too little value for its contributions to the EU pot.

During a press conference in Brussels on Wednesday evening, Le Pen accused negotiators of speeding up talks as “an attempt to stifle future democratic choices before they even take place” — effectively warning Macron against locking in an agreement before France’s April presidential election and votes in other major EU countries, such as Spain, which goes to the polls next month, and Italy, which is due to hold a poll next year.

“All this is not serious,” Le Pen told reporters on the 26th floor of The Hotel in Brussels.

It’s complicated

Merz faces similar political pressures.

Following humiliating state election defeats to the far-right Alternative for Germany party, the Chancellor is wary of concessions that could be framed as sending more taxpayer money to Brussels. Berlin prefers no deal at all to one that increases the overall budget, Merz said.

But Paris and Berlin’s positions may not be as far apart as public statements suggest.

“It’s complicated because France and Germany both need to step outside of their comfort zone,” said the Macron ally. “But it will end with a deal between France and Germany,”

France’s Europe minister Benjamin Haddad told reporters on Tuesday that discussions should focus on raising money via taxes, or “own resources” as they’re known in the EU —such as online gambling levies—rather than “massive cuts.”

However, Paris also wants to “stabilize national contributions” ― in other words, keep its own payments level.

Berlin was “open to examine new own resources, but we are more skeptical than the French that it will generate enough money,” a German official said.

France is betting that when push comes to shove, Merz will give in to pressure from other countries — and German captains of industry — to abandon his demands for far-reaching cuts.

“I see that there is also a real debate in Germany as well on the fact of having a position that would only be focused on cuts to the detriment of future policies,” an Elysée official said Wednesday. This week, Germany’s industrial lobby BDI and top industry groups urged their government to defend a more ambitious EU budget.

Macron and Merz showed unity earlier this month by jointly urging the European Commission to toughen its stance on China. But they still struggle to agree on another major deal—first reported by POLITICO in July—where Berlin accepts stronger “Made in Europe” rules in exchange for France backing relaxed car emission targets and the 2035 combustion engine ban.

EU Industry chief Stéphane Séjourné told POLITICO on Tuesday he supported the deal to finalize both files. Macron recently called the agreement “imminent,” suggesting progress depended on German coalition talks. But their failure to present an agreement at this week’s Paris car show confirms Paris and Berlin still disagree on terms, with the Elysée confirming negotiations remain ongoing.

BRUSSELS — Far-right leader Marine Le Pen pledged to turn the European Commission into a “secretariat” in the service of its member countries as part of her plan to slash the size and power of the European Union should she win France’s presidential election next year. 

“Over the past 10 years, France has seen the implementation of a European vision that is the exact opposite of the one I will champion,” Le Pen told reporters at a press conference in Brussels after a meeting with fellow European far-right leaders. “They wanted a powerful Europe. We got a powerless Europe. They wanted European sovereignty. All we’ve gotten is the dilution of national sovereignty.” 

Asked by POLITICO what downsizing the EU would look like in practice, the front-runner in the race to replace term-limited President Emmanuel Macron next year said the EU should pare back its operations in areas it has expanded in recent years such as foreign policy, security and public health.

Le Pen also promised to “stop” the bloc’s Green Deal, which she claimed was harming economic growth, and eliminate institutions like the European Committee of the Regions and the European Economic and Social Committee. 

“I’m not fooled by what the European Commission wants to do. The European Commission wants to turn itself into a state; we do not. And so we will stand in its way,” Le Pen said. 

Though Le Pen has abandoned her calls for France to leave the European Union, she remains deeply skeptical of the bloc and its ambition. 

She and her National Rally party last week said they would unilaterally slash France’s annual contribution to the EU budget by €11.1 billion as early as next year if Le Pen wins the presidency. 

Le Pen frames the move as necessary to help fix France’s disastrous public finances — she is proposing €140 billion in savings by 2032 — but her critics say such a move would set up a dramatic showdown with Brussels that could end with France leaving the bloc. 

Le Pen is in Brussels the day before EU leaders meet for key discussions over the bloc’s next seven-year budget, which Council President António Costa had hoped to get finalized before elections in France, Italy and Poland in 2027 that could derail the talks. 

But EU countries have weakened their commitment to wrap up negotiations by year-end amid a major split between frugal countries such as Germany, which want to further shrink the budget, and countries like France that support more EU spending.  

Le Pen once again reiterated her accusations that Brussels’ attempt to speed up budget talks — which would prevent France’s next government from having a say in the matter — is “a democratic scandal.” 

This developing story has been updated.

EU leaders returned Friday for their second day of marathon talks, with a discussion on migration set to descend into a showdown over whether to push for tougher controls.

Before those talks, Denmark called for new, tougher language linking migration to crime.

Earlier, Ukrainian President Volodymyr Zelenskyy made a direct pitch for more help amid a crisis of faith among allies over Donald Trump’s latest steps favoring Russia.

Leaders are expected to turn to the question of how to protect the bloc from Russian hybrid attacks, maritime security and the Middle East.

On Thursday, a three-hour argument over taxing car emissions derailed Antonio Costa’s carefully laid plans to tackle the biggest challenges facing the bloc: fixing its economy and sorting out its spending priorities, drawing ire from some diplomats.

As leaders piled into their motorcades around midnight after 14 hours of talks, they seemed as far away as ever on negotiations over the bloc’s next long-term budget — with the next serious round of talks slipping to November.  

The European Commission’s bid to make the EU’s billions more responsive to the unknown crises of the future might also make them more prone to misuse, the EU’s top spending watchdog warned.

European Court of Auditors President Tony Murphy said key pillars of the Commission’s plan to overhaul the EU’s long-term budget would muddy the view for those in charge of making sure public money is spent as intended.

“It’s more difficult for us to follow the money,” Murphy said. “You’re saying to the member state, here’s a whole lot of money, and you make sure everything is okay. It’s sort of a self-policing.”

The warning comes as EU leaders continue fighting over the price tag for the EU’s post-2027 budget in Brussels this week — and as the auditors document an increase in misspending of taxpayer funds.

Yet separate from the budget’s bottom line is the debate over how that money gets divided. As a spending cycle marked by the pandemic, wars and climate-fueled disruption comes to a close, the Commission wants to make the next seven-year budget more agile by assigning about half of it — almost a trillion euros over seven years — to a single pot of money that countries can spend on objectives ranging from migration to agriculture and regional development.

Those agriculture and regional development funds — often delivered in the form of subsidies to farms and local projects — have long been vulnerable to fraud and misuse.

According to Murphy, giving capitals more leeway to shift spending would make spending even harder to track.

“There will be some flexibility, but at what cost?” he said in an interview. More of the oversight will depend on the checks each country has already put in place.

As it stands, misspending of the EU budget was on the rise last year, with errors affecting transactions for an estimated €5 billion according to the ECA’s latest report.

In the next EU budget, it might not be possible to even estimate such a number, Murphy warned, as each country’s auditors have different roles and ways of doing things. His head of cabinet, Wolfgang Stolz, added during the interview: “Year after year we have found that the work of these auditing authorities is not fully reliable.”

In a statement, the Commission defended its proposal, underlining that “key principles” of the current control system will remain in place. National authorities are “well-functioning,” the statement contended, but added that the Commission would maintain the right to ask capitals to “amend the plan or introduce correction mechanisms if needed.”

‘Mixed bag’

One of the Commission’s proposed innovations is putting the Common Agricultural Policy — historically a standalone budget line — into a behemoth umbrella fund known as the National and Regional Partnership Plans.

Murphy stressed that he’s not advocating for any model over the other. But as EU money increasingly merges with national budgets, it will be harder for Brussels to monitor where its money actually goes. The CAP is simpler to audit when “it’s not mixed up in this mixed bag,” Murphy said.

Headlines about farm subsidies paying for fake pastures in Greece and cash meant to support rural tourism in Slovakia instead going to luxury villas for the rich offer lurid illustrations of the challenge of policing these funds under the current system.

And the model for the new spending system — the EU’s post-Covid recovery fund — doesn’t bode well, Murphy said. While it became easier for countries to direct the funds where they were needed, the spending also became more opaque. The new national plans were designed using the same blueprint.

Under the current budget system, the ECA can physically visit a farm that receives EU funds. However, under the Covid recovery fund, the EU publishes only the top 100 beneficiaries each year.

“It’s not very transparent. I mean, where is the EU money actually ending up? That’s what matters,” Murphy said. “You have a fund where there are different policy areas with completely different objectives and timeframes, different delivery mechanisms and less predictability.”

PARIS — Conservative presidential candidate Bruno Retailleau said France should seek a rebate on its contribution to the EU budget ahead of a key European summit in Brussels this week.

France pays more in to the EU budget than it gets out, but it is struggling to reduce a severe budget deficit.

“It’s crazy,” Retailleau, the leader of the conservative party Les Républicains, said at POLITICO’s Competitiveness Summit in Paris. “Why should we contribute more when we know how dire our public finances are?”

European leaders are meeting in Brussels on Thursday and Friday to discuss the bloc’s long-term budget, the Multiannual Financial Framework, which is pitting the so-called frugal countries against those who want a bigger EU budget. France sits in neither camp.

Retailleau singled out structural funds — money that is invested in poorer European regions — as an area where savings could be made.

“We’ve given billions to countries so they would catch up with us. Well they have, and in a couple of years they’ll probably have a higher standard of living. Sorry, but stop,” he said.

However, Retailleau, who is trailing center-right presidential candidate Edouard Philippe and far-right front-runner Marine Le Pen in the polls, did not put a figure on the rebate he would demand if he came to power. Le Pen, who is the front-runner ahead of next year’s presidential election, and her party have proposed slashing France’s yearly contribution by €11.1 billion as early as next year.

Retailleau said he would seek “a negotiation,” rather than unilaterally impose a lower contribution, as Le Pen says she would do.

“I’m not going to behave like Marine Le Pen, I’m pro-European,” said Retailleau.

Retailleau argued that France’s defense and nuclear deterrence investments should also be included in the country’s contribution calculation, because the concept of forward deterrence benefits France’s European neighbors.

PARIS — French center-right presidential candidate Edouard Philippe accused his far-right rival Marine Le Pen of trying to force a Frexit in disguise with her euroskeptic campaign promises.

“There is something in Marine Le Pen’s proposals that has the potential to blow Europe up, or let’s say to crack it open,” Philippe said at POLITICO’s Paris Competitiveness Summit on Tuesday.

The former prime minister — who is currently the best-placed centrist candidate to challenge the front-running Le Pen, according to recent polls — said Le Pen’s plan to unilaterally demand a drastic cut to France’s contribution to the EU budget was akin to “saying you want out of Europe” without openly advocating for leaving the bloc. Le Pen had previously called for a referendum in France on leaving the EU but dropped the proposal after her crushing defeat to Emmanuel Macron in the 2017 presidential election. Her party, the National Rally, now says it wants to change the EU from within.

Philippe, a fiscal conservative who has been pitching himself as the voice of reason in a campaign dominated by populist rivals, also slammed budget plans Le Pen unveiled last week as “grotesque,” accusing her of pitching “fantasy” savings.

Le Pen’s fiscal plans have faced serious scrutiny since being presented, with many observers saying they either lack key details or overestimate savings on major proposals like immigration. Progressive think tank Terra Nova wrote in a note out Tuesday that Le Pen’s budget presentation was “riddled with errors and contradictions” as well as “botched estimates.”

“She isn’t even able to estimate the cost of the pension reform she is proposing,” Philippe said.

Le Pen said in August that her plan to bring France’s legal retirement age back down to 62 for most workers would cost €9 billion a year, and last week she said she would lay out at a later stage how she intends to fund her flagship pledge. However, the Institut Montaigne, a fiscally conservative think tank, estimated the proposal would cost €34.7 billion a year.

Philippe is hoping to convince voters that his fiscally conservative agenda is the right path in a country burdened by a ballooning public debt and a budget deficit still above 5% of gross domestic product, in breach of EU rules.

Philippe said France needed to get its finances back on track to regain credibility on the European stage after a “loss of influence” over the past few years.

Though he currently leads a crowded field of centrist candidates, Philippe’s campaign has struggled in recent weeks to gain momentum — and far-left candidate Jean-Luc Mélenchon is now challenging the former PM for second place in the polls. France’s presidential election goes to a runoff if no candidate receives more than 50% of the vote, and Le Pen’s strong poll numbers all but guarantee her a spot in the second round.

Tough on China

The former prime minister pitched a pragmatic European agenda with less regulatory burden, more focus on investment and a tougher approach to China.

Philippe had some harsh criticism for an already embattled flagship measure of the EU’s green deal, saying the 2035 combustion engine ban has been “disastrous.”

There was “a great naiveté toward China,” which ultimately benefited from Europe’s push on electric vehicles, Philippe said.

“We need to much better protect our market,” he added. “If one wants access to the European market, one has to manufacture in Europe. If a carmaker doesn’t manufacture here, then we have to slap high tariffs.”

The EU is in the process of drawing up new “Made in Europe” rules that would favor European producers over those outside the bloc, in response to trade practices by competitors like China and the United States.

Shortly before Philippe took the stage, European Commissioner for Industry Stéphane Séjourné said at the POLITICO event that a Franco-German deal trading stronger protections on the definition of Made in Europe in exchange for a loosening of combustion engine rules should be finalized “in the next few hours or in the next few days.”

On artificial intelligence, Philippe aligned himself with Macron, advocating for European sovereignty in the field and the need to regulate what he described as “an instrument of power.”

“What I see is an AI world making money for the U.S. with European savings and European data, and that bugs me,” he said.

Germany has rejected Ireland’s proposal for the EU’s next seven-year budget, despite €159 billion in cuts. And it’s not alone: Governments are divided over where the cuts should fall, while the European Parliament is threatening to block the deal.

Zoya Sheftalovich and Nick Vinocur unpack the backlash and what it means for this week’s EU leaders’ summit.

Plus, Zoya interviews Migration Commissioner Magnus Brunner about Europe’s efforts to curb irregular migration and plans to tighten restrictions on Russian visitors and former soldiers.

And why the influencers expected at this week’s EU summit won’t be showing up after all.

Questions? Comments? Let us know on our WhatsApp here or at +32 491 05 06 29.

BRUSSELS — Europe will lose out because of €159 billion in cuts to the bloc’s next long-term budget, the European Commission has warned days before EU leaders gather in Brussels for talks on the bloc’s future spending plans.

In an unusual attack, the Commission told governments that scrapping billions from several rainy-day funds will leave Europe less equipped to deal with crises during the next seven-year budget cycle, said four EU diplomats briefed on the talks, granted anonymity to speak freely about confidential discussions.

The Commission’s top budget official, Stéphanie Riso, delivered the warning to the EU’s 27 ambassadors during a closed-door meeting on Sunday, a day after the Irish presidency of the Council of the EU, which is steering the talks, proposed cutting around 8% from the bloc’s total budget from 2028 to 2034.

The Commission is “very concerned about cuts to flexibility,” said one of the EU diplomats.

As a result of the changes, “we will have no ways left to help farmers and regions when crises hit, because of climate change or geopolitical tensions,” they added.

EU ambassadors gathered to discuss the Irish plan, which envisages cuts of €159 billion in current prices from the Commission’s nearly €2 trillion proposal. Of that amount, €38 billion was cut from foreign aid, €75 billion was axed from competitiveness, and at least €22 billion was slashed from rainy-day funds.

But even those reductions were criticized as insufficient by a German-led group of states pushing for cuts of several hundred billion. During the closed-door meeting, a rival bloc of 17 countries, known as the Friends of Cohesion, welcomed the fact that the Irish presidency had spared agriculture and regional payments from cuts.  

EU governments are racing to finalize a deal on the budget among themselves by the end of the year — before elections in France, Italy and Poland that threaten to disrupt the negotiations.

A leaders’ summit on Thursday and Friday will give early signals as to whether the end-of-year deadline is achievable — or whether leaders should start preparing contingency plans.

One EU diplomat said the pressure is now on those leaders: “What could make a difference is if Friedrich Merz and Emmanuel Macron show up, hand-in-hand, and say we live in a new world.”

Cuts to the future

The Commission warned that cuts such as those put forward by Ireland will shrink the next budget — excluding repayments to post-Covid debt — below the current one.

The cuts overwhelmingly affect EU-wide priorities such as competitiveness, defense and foreign aid while leaving traditional policies untouched such as agriculture and regional payouts, which make up almost half the budget.

The changes undermine the Commission’s proposal, which envisaged more flexibility and steered hundreds of billions of euros toward new priorities.

In a further setback for the Commission, Ireland also downsized — or even scrapped — several financial cushions to shelter EU countries from unforeseen events such as natural disasters or public health emergencies.

The EU executive argues these changes will make spending in the next budget more rigid than in the current one — and potentially warrant a midterm review of the budget further down the line.

However, Ireland’s Europe Minister Thomas Byrne disputed this claim in a press conference on Saturday, saying the budget proposal “offers increased flexibility … in response to the clear call from member states for a simplified and more flexible, modern [budget].”

Another source of tension in the next budget came from Ireland’s watering down the link between EU payouts and economic reforms.

The Commission has repeatedly defended using regular budget payments as a carrot to nudge governments to undertake reforms that will make them more competitive.

However, Ireland’s ambassador to the EU, Aingeal O’Donoghue, said during the meeting that the new text will not link EU cash disbursements and “fiscal reforms,” according to one of the diplomats.

BRUSSELS — Germany and its allies rebuffed Ireland’s plan to downsize the bloc’s next seven-year budget, arguing that the proposed cuts are not enough.

On Saturday, the Irish presidency of the Council of the EU, which is steering the talks, proposed cutting around 8% from the bloc’s total budget from 2028 to 2034 in a bid to assuage a German-led camp demanding reductions of several hundred billions euros.

But Dublin’s hopes of facilitating a deal were immediately dashed by German Chancellor Friedrich Merz, one the key players in the negotiations as his country contributes to approximately one-quarter of the bloc’s common budget.

“We are still a long way from an agreement. The amount of the new proposal is not a basis for an agreement. The EU budget must be affordable for those who bear the brunt of the financing,” Merz wrote in a statement on Saturday.

Germany leads a group of six “frugal” countries — Sweden, Denmark, the Netherlands, Finland and Austria — which contribute 40% of the Union’s common budget.

Most frugal countries criticized Ireland’s proposed €159 billion in cuts in current prices from the Commission’s nearly €2 trillion proposal, saying they were insufficient.

Sweden’s Europe minister Jessica Rosencrantz described the negotiating document, or negobox, on X as a “wildly unaffordable increase,” as the overall amount would still be higher than the current budget.

Austrian Europe Minister Claudia Bauer echoed that criticism, saying that the new budget remained “miles away from an Austrian yes.”

Tensions will come to a head during a summit of EU leaders next Thursday and Friday, where they will discuss the negobox.

EU governments are racing to reach a budget deal among themselves by the end of the year — before elections in France, Italy and Poland in 2027 threaten to derail negotiations.

But Dutch Finance Minister Eelco Heinen warned on Saturday that “at this rate, there will be no deal by the end of the year.”

Ireland’s Minister of State for European Affairs Thomas Byrne, who leads the negotiations, dismissed criticism and described the proposal as a balanced compromise.

“The negotiating box acts to bridge the many differences between the Member states,” Byrne told reporters on Saturday.

Divided Union

The EU is split between frugal countries pushing for cuts across the board and a rival camp of southern and eastern states, the Friends of Cohesion, opposing reductions to farmers’ subsidies and regional payouts known as cohesion policy.

These areas account for almost half of the total budget and are politically sensitive because of pressure from farmers’ lobbies and regions.

In a concession to the 17 Friends of Cohesion, Ireland left the agriculture and regional budgets untouched and focused cuts on other priorities such as competitiveness, defense and development aid.

“There was a strong support for heading one [agriculture and cohesion] from almost all of the member states, including some of the countries who would be considered to be net contributors” to the budget, Byrne told reporters.

Reactions to the negobox from the Friends of Cohesion were more conciliatory than those of their frugal peers.

“It’s an excellent starting point to have recovered the money for the CAP [Common Agricultural Policy], but we’re still not satisfied,” said Italy’s Agriculture Minister Francesco Lollobrigida.

Poland’s Europe minister Ignacy Niemczycki welcomed the fact that his country “continues to receive the largest allocation,” but noted that the “change in the overall size of the budget does not match the EU’s ambitions.”

The frugals were also are disappointed that the cuts disproportionately target innovative policies such as defense and competitiveness, which they favor.

“They’re cutting the future to protect the past,” said one EU diplomat from the frugal camp.

LUXEMBOURG — EU finance ministers struck a compromise to beef up the bloc’s markets watchdog Friday, but the deal exposed divisions over national control and exemptions that critics say favor the biggest member countries.

Most finance ministers backed the Council’s position on MISP, a package of bills to integrate and police financial markets. At its heart is a plan to give the EU’s securities regulator powers to oversee major financial players — a flagship bid to make Europe a stronger investment hub, where European companies can seek investors without traveling to Wall Street.

But capitals stopped short of handing the future watchdog too much autonomy, triggering a hard rebuke from the European Commission.

“We deeply regret that the compromise now on the table falls significantly short of the level of ambition needed,” Finance Commissioner Maria Luís Albuquerque told ministers during Friday’s public Ecofin debate in Luxembourg. “We need [the European Securities and Markets Authority] to become an effective supervisor. The current compromise text would not allow for that.”

France spearheaded a last-minute push over dinner Thursday to strengthen the watchdog’s executive powers. Paris took issue with a rule that would allow nine national supervisors to force the watchdog’s executive board to submit draft decisions for further scrutiny before they’re adopted. The Irish EU presidency tweaked the rule overnight to limit national supervisors’ ability to delay decisions and preserve the watchdog’s power to act in emergencies, according to a compromise document obtained by POLITICO.

That was enough for France and most other countries. But not for the Commission, nor European Central Bank President Christine Lagarde, who was equally critical of the Council compromise. Beyond the governance concerns, Albuquerque took aim at supervisory carve-outs that the Irish introduced to accommodate Germany’s push to exclude its stock exchange, Deutsche Börse, from EU oversight.

The carve-out club

The carve-out shields stock exchanges from direct EU supervision unless they meet certain thresholds for trading activity and cross-border reach. Spain’s stock exchange, Bolsas y Mercados Españoles, would also benefit from the carve-outs, triggering criticism from smaller EU countries that accused the waiver of granting the bloc’s largest nations preferential treatment.

Belgium was particularly critical because its Brussels-based securities depository Euroclear is expected to come under direct EU oversight and face supervisory fees, while some major stock exchanges could remain under national oversight. Belgian Prime Minister Bart De Wever will take the issue to EU leaders at the end of next week.

“We cannot support the carve-outs. The package includes as many ins as there are outs,” Belgian Finance Minister Jan Jambon said during Friday’s public debate. “I think Germany has won in certain cases.”

As a peace offering, Berlin backed a review clause that would allow the Commission to revisit the carve-outs two years after the supervisory rules start applying. Any changes would require new legislation, however.

“The carve-out is temporary,” Dutch Finance Minister Eelco Heinen, who backed the deal, told journalists Thursday. “If that exchange were to grow, it would also fall under [EU supervision]. This is also intended to ensure that Dutch companies or pan-European companies such as Euronext are not put at a disadvantage.”

Friday’s deal puts pressure on MEPs to agree Parliament’s position so negotiations on a final text can begin. The Commission hopes future legislative negotiations will provide a second chance to improve the text, which also threatens to increase pressure on the EU budget.

Under the compromise, the EU budget would shoulder 60% of the cost of ESMA’s activities not covered by industry fees, with national supervisors paying the remaining 40%.

“The Commission cannot accept a significant increase in the EU budget contribution in light of the difficult discussion at [the Multiannual Financial Framework],” Albuquerque said amid a bitter budget battle that threatens to shave hundreds of billions of euros off the proposed €2 trillion cash pot. “I sincerely hope that the European Parliament will be more ambitious.”

BRUSSELS ― EU governments expect the proposed size of the bloc’s next seven-year budget to be slashed by €100 billion to €200 billion from the previous plan announced in June, 12 EU diplomats told POLITICO.

Ireland, which holds the presidency of the Council of the EU and is steering the talks, will unveil the proposal on Saturday, setting the scene for fraught discussions among EU leaders at their summit next week.

The bloc is split between so-called frugal countries — Germany, Austria, the Netherlands and others — that want to slash several hundred billion euros from the nearly €2 trillion proposal on the table, and a rival coalition of southern and eastern countries, the Friends of Cohesion, that opposes the cuts.

Dublin is expected to cut the budget by between €100 billion and €200 billion as a goodwill gesture to the German camp, the diplomats said. However, the Irish plan to shield agriculture and regional spending from major cuts as a concession to the Friends of Cohesion.

At next week’s summit, EU leaders will react to the latest numbers, known as the “negobox” because it gives governments something to negotiate on, and signal early whether an agreement is possible by the end of the year.

Governments are rushing to secure a deal among themselves before national elections in France, Poland and Italy in 2027 threaten to derail the negotiations.

As a neutral broker in the discussions, Ireland hasn’t publicly disclosed its intentions on the negotiating document. 

Dublin’s European Affairs Minister of State Thomas Byrne told the European Parliament earlier this week that EU member countries have made “substantial progress” toward an agreement. But he warned: “we cannot satisfy everybody.”

Germany and its allies criticized the previous Cyprus Council presidency for cutting only €32 billion in the last negobox in June.

Ireland’s looming cuts

The frugals’ calls for budget savings have ignited fears among the Friends of Cohesion. 

The 17 countries — including heavyweights Italy, Spain and Poland — issued a joint statement last week opposing cuts to agriculture and cohesion. 

In a concession to this camp, Ireland is expected to propose budget savings in other policy areas. Governments are bracing for major reductions to the Global Europe fund, the EU’s €200 billion pot of development aid and external relations cash, and the €410 billion European Competitiveness Fund to boost the bloc’s industrial capacity. 

Cuts to administrative costs, with €118 billion earmarked for the EU’s institutions and staff, are also popular among EU governments, though they will yield fewer savings.

However, frugals have warned against shielding agriculture and cohesion from a smaller budget. They argue instead that more money should be steered away from traditional priorities towards new challenges such as defense and competitiveness.

“We are very concerned that Ireland would decide to smash funding for research and external action, which is a major issue for development, our economic interests and migration,” said one EU diplomat, granted anonymity like others in this article to speak frankly about their expectations for the sensitive negotiations.

Tax game

Another sensitive issue is EU-wide taxes — known as “own resources” — to finance the budget and reduce national contributions.

In 2025, the European Commission proposed five new levies that are expected to generate €66 billion per year. During negotiations, governments opposed levies that would overwhelmingly affect their economies.

Several European governments lobbied Ireland to remove a corporate tax, known as CORE, that is unpopular across the bloc. But Dublin is expected to refrain from doing so, and keep the Commission’s five levies in the negobox.

To make CORE more palatable, Dublin might exempt small and medium enterprises from the scope of the levy. It could also make tweaks to a tobacco levy that is opposed by many.

Instead, the European Parliament’s proposed taxes on digital levies, online gambling and crypto firms are expected to be left out entirely from the negobox.  

An EU diplomat criticized these incremental changes as “disappointing and minimal.”