Germany and Frugal EU Nations Demand Major Cuts to 2028-2034 EU Budget Proposal

Germany, alongside five other fiscally conservative EU member states — Denmark, Finland, Sweden, Austria, and the Netherlands — has collectively called for significant reductions to the European Union's proposed nearly two trillion euro budget for the 2028-2034 period. Chancellor Friedrich Merz (CDU), representing Germany, criticized the European Commission’s current draft, which anticipates a budget increase of up to 60%, labeling it "simply unaffordable" amidst ongoing budget consolidation efforts across member countries.

The group, often referred to as the "Frugal" countries, demands a decrease of several hundred billion euros from the plan, emphasizing the importance of a balanced reduction rather than indiscriminate cuts. Their priorities for EU spending concentrate on security, defense, competitiveness, migration, and sovereignty, advocating that all spending areas contribute to necessary savings. They also oppose the issuance of new joint EU debt, arguing this is not a viable solution to the bloc’s fiscal challenges.

Together, the six nations finance roughly 40% of the EU budget and provide 70% of bilateral aid from EU countries to Ukraine, underscoring their influential role in financing the Union. Merz has stressed the need to modernize the budget to tackle 21st-century challenges while maintaining sustainability. In addition to reducing expenditure, the coalition calls for a reform of the EU budget’s architecture, including measures to link funding to adherence to the rule of law and European values, and for limiting administrative staff growth within EU institutions.

However, this position faces opposition from over 15 member states, including Italy, Spain, and Poland, who defend the current budget size and favor preserving existing funding programs. Critics within the EU, such as MEP Rasmus Andresen, have described Merz’s stance as potentially destructive to EU unity and suggested exploring alternative revenue sources and compromises.

Upcoming negotiations will intensify at the EU summit scheduled for October, with Ireland — holding the EU Council presidency — expected to present revised proposals. The principal aim is to reach an agreement on the financial framework before the end of 2026, navigating between the frugality demanded by these six nations and the investment ambitions of others.