EU plans to spend over €200 billion in 2027: where the money will go and how much will be allocated to Ukraine
Kyiv • UNN
The EU is considering the bloc’s budget for 2027 and support for Ukraine. The member states have still not agreed on the amount of future funding.
On October 21, the European Parliament is considering the results of the European Council summit held on October 15–16 in Brussels, as well as the European Union’s budget for 2027. Key issues include financial support for Ukraine, defense spending, the competitiveness of the European economy, and the future of the EU’s multiannual budget.
However, it is already known that, despite confirming common priorities, the member states have not yet reached a compromise on the amount of funding for the coming years.
UNN explains how everything unfolded and why the European Parliament’s budget decisions are currently extremely important for Ukraine.
The European Parliament discussed the summit’s results — which issues became key
During the plenary session in Strasbourg on October 21, MEPs returned to the issues discussed by the leaders of the 27 EU member states at the October 15–16 summit.
One of the central topics was the EU’s economic competitiveness. European leaders examined the consequences of rising energy prices, the need to support industry, reducing the administrative burden on businesses, and accelerating investment. According to European Commission President Ursula von der Leyen, European gas prices have risen by 140% since the end of February, while diesel fuel has doubled in price. Additional costs for importing fossil fuels amounted to approximately €100 billion. Against this backdrop, EU leaders called on the European Commission to consider short-term measures to contain energy prices while maintaining the strategic course toward the development of renewable energy.
The EU’s future spending was no less important an issue. The states must simultaneously finance defense, economic development, social programs, and support for Ukraine. However, some national governments are already insisting on limiting budget expenditures, resulting in heated debates.
Support for Ukraine after the summit — what decisions did the European leaders make
Following the meeting, the European Council reaffirmed its readiness to continue political, financial, economic, humanitarian, and military support for Ukraine.
Particular attention was paid to preparations for winter, the protection of energy infrastructure, and strengthening air defense following large-scale Russian attacks. EU leaders welcomed the continuation of payments under the €90 billion Ukraine support loan mechanism for 2026–2027. They also supported the decision to allocate €6.6 billion under the European Peace Facility (EPF).
However, despite these optimistic developments, Ukraine’s financial needs for 2027 remain substantial. Therefore, during the summit, President of Ukraine Volodymyr Zelenskyy appealed to European partners to provide an additional €70 billion. Following this, the European Council instructed the European Commission, together with the International Monetary Fund, to update its assessment of Ukraine’s financial and defense needs and prepare concrete financing proposals.
The EU budget for 2027 — how much money is proposed for allocation
The draft European Union budget for 2027, presented by the European Commission, provides for approximately €199.9 billion in commitment appropriations and €212 billion in payment appropriations, taking special instruments into account. Commitment appropriations determine the amount of financial commitments the EU may enter into during the year. Payments are the funds actually planned to be disbursed, including under programs from previous years.
However, the Council of the EU proposed reducing the initial draft by approximately €1 billion in commitment appropriations and €500 million in payment appropriations. Its budget position provides for €191.88 billion in commitments and €202.07 billion in payments, excluding special instruments outside the multiannual financial framework. Meanwhile, the European Parliament’s Budget Committee opposed the proposed cuts. The committee set expenditure within the main budget headings at €194 billion in commitments and €203.3 billion in payments.
MEPs also proposed increasing funding for priority programs by €1.17 billion compared with the European Commission's initial draft. These discrepancies became the basis for further budget disputes between the European Parliament and the member states.
What the European Parliament wants to allocate additional funds to
The European Parliament's Budget Committee proposes directing the largest share of additional funding to economic development, infrastructure, and scientific research. In particular, €376.7 million has been earmarked for programs related to competitiveness. Of this amount, €260.5 million is proposed for addition to the Connecting Europe Facility, which supports the development of European transport and energy networks. Another €63 million is planned for Horizon Europe, while €31.6 million is intended for the Single Market Programme.
An additional €275.1 million is proposed for social and humanitarian priorities. In particular, €96 million is earmarked for Erasmus+, €80 million for the civil protection mechanism, and €50 million for EU4Health.
An additional €182.5 million will be allocated to agriculture, environmental protection programs, and support for young farmers.
Funding for border management and migration programs is to be increased by €72.9 million, while funding for security and defense is to rise by €66.3 million, of which €20 million is earmarked for military mobility.
Another €139 million is proposed for addition to funding for foreign-policy programs, including humanitarian aid and support for the EU's eastern and southern neighbors.
EU long-term budget for 2028-2034 - why member states cannot reach agreement
The EU's long-term budget (MFF) for 2028-2034 remains a separate subject of dispute. Unlike the annual budget, it sets the bloc's main financial priorities for the next seven years.
The European Commission proposed a long-term financial plan worth approximately €1.76 trillion. However, Ireland, which holds the presidency of the Council of the EU, presented a compromise option involving a reduction in spending of approximately €141 billion, or 8%. The proposed total is approximately €1.62 trillion.
Despite the cuts, a number of countries, including Sweden, Germany, and the Netherlands, consider the financial commitments excessive. At the same time, other states advocate maintaining sufficient funding for agriculture, regional development, and social programs.
The European Parliament, for its part, criticizes the proposed restrictions. According to its representatives, taking inflation and the costs of repaying common debt into account, the new budget's real purchasing power could decline by approximately 10% compared with the current financial period.
Another problem is the lack of agreement on new sources of EU revenue. Possible options under discussion include additional levies on large digital platforms and other Europe-wide revenues. The October 15-16 summit did not ensure any significant convergence of positions, so further negotiations were entrusted to European Council President António Costa.
What the European Union's budget decisions mean for Ukraine
For Ukraine, the consequences of the European budget negotiations extend far beyond ordinary state expenditure planning. At a minimum, the stability of international budget support, defense procurement, infrastructure reconstruction, and the implementation of joint economic programs will depend on the availability of EU financial resources.
Ensuring Ukraine's financial needs for 2027 is of particular importance. It is the European institutions that must determine the sources of funding, the conditions for raising it, and possible mechanisms for distributing the financial burden among partners.
It should also be noted that the European Parliament's Budget Committee separately proposed earmarking €1.1 billion to cover the cost of borrowing under the Ukraine Loan Cooperation Mechanism.
At the same time, the EU links the timely disbursement of part of the funding to Ukraine's implementation of the agreed reforms, particularly in the area of the rule of law and its commitments under the Ukraine Plan.
When will the EU budget for 2027 be finally approved?
The review of the European Union's annual budget is now entering its final phase. Following discussions on October 20, the European Parliament's vote on budget amendments and its own position for 2027 is scheduled for October 21.
Since the positions of the European Parliament and the Council of the EU differ, the next step should be a conciliation procedure involving representatives of both institutions. The first meeting of the conciliation committee is scheduled for November 3, while the 21-day period allotted for reaching an agreement is due to end on November 16.
If a compromise is reached, the agreed budget must be approved by both sides. If the negotiations fail, the European Commission must present a new draft budget.
The EU's key financial decisions by the end of 2026 — what to expect next
By the end of the year, the European Union must resolve several strategic financial issues. The most immediate task will be approving the annual budget for 2027, on which funding for current European programs will depend. In parallel, the European Commission must determine the possibilities for additional support for Ukraine, based on updated calculations of its needs.
In November, António Costa is expected to present a new basis for negotiations on the multiannual budget.
A special European Council summit devoted to the 2028–2034 financial framework is scheduled for November 26–27. The next discussion is expected on December 17–18.
European leaders aim to reach a political agreement by the end of 2026 so that the necessary legislation can be adopted during 2027 and uninterrupted funding for programs can be ensured from January 2028. However, reaching a compromise is complicated by disputes over member states' contributions, defense spending, agricultural subsidies, and the search for additional sources of budget revenue.
Recall
Earlier, UNN reported that EU leaders had failed to reach an agreement on the long-term budget at a summit in Brussels. The countries are arguing over whether to cut spending or increase the budget.