German Chancellor Friedrich Merz, alongside leaders from five EU countries, is demanding significant reductions to the proposed 2028-2034 EU budget, citing its financial impracticality amid calls for economic realism.

German Chancellor Friedrich Merz has joined forces with heads of government from Denmark, Finland, the Netherlands, Austria, and Sweden to oppose the European Commission’s proposed budget for 2028-2034. The Commission had suggested a substantial increase of up to 60% over the current EU financial framework, but Merz and his counterparts argue that the proposal is economically unfeasible given the need for fiscal consolidation.

During a confidential meeting in Berlin, Merz and the group agreed to push for cuts amounting to several hundred billion euros across all sectors of the budget. Citing their countries’ contributions to 40% of the EU budget and 70% of bilateral aid to Ukraine, Merz emphasized the need for a realistic and reformed approach. He stated, ‘We are not stingy, but such drastic increases simply don’t fit the times we’re living in.’ The coalition aims to present a unified stance during the October budget talks in Brussels.

The contested budget proposal, totaling 1.76 trillion euros (adjusted to 2025 prices), includes increased funding for areas like defense, agriculture, regional development, and the Erasmus exchange program. Merz and his allies argue the focus should shift to promoting EU competitiveness and modernizing industrial policy to address 21st-century challenges. They aim to finalize negotiations by the end of the year to meet the January 2028 deadline for implementing the new financial framework.