Carla Tavares is one of the voices most directly involved in negotiating the next Multiannual Financial Framework. A Portuguese socialist MEP and co-rapporteur for the European Parliament on the EU budget, she is handling one of the legislature’s most delicate debates: how to finance a Europe that aims to strengthen competitiveness, security and strategic autonomy without draining traditional policies such as cohesion, agriculture or the European Social Fund. This interview is complemented by the one with the other MFF rapporteur in the European Parliament, the EPP’s Siegfried Mureșan.
When the Commission’s proposal arrived, Parliament did not hesitate to criticize it. Tavares explained to me that the problem lies both in the size of the budget and in the political architecture underpinning it: a significant share of the funds would remain unallocated and could be distributed over the seven years of the framework at the Commission’s discretion. In Parliament’s view, that flexibility shifts power away from the budgetary authority and towards the EU executive, leaving too little room for citizens, municipalities and regions.
The underlying disagreement cuts across almost all the major European dossiers. The conversation covers new own resources, common debt, the common agricultural policy, the role of regions and the debate between cohesion and competitiveness. Tavares rejects that false opposition and argues that both must move forward together. The negotiation also comes against a busy electoral calendar in several member states and with a more fragmented European Parliament. The outcome will not only decide how much money the EU has, but what political capacity it retains to act.
Marc López Plana speaks with Carla Tavares about the negotiation of the next European budget. Photo: Agenda Pública
What is the role of the European Parliament and what were your first impressions of the Multiannual Financial Framework proposal received from the European Commission?
We received the Commission’s proposal in July 2025, and Parliament’s first reaction was very critical for several reasons.
First, the overall size of the budget is a major concern. The Commission proposed a budget equivalent to 1.15% of EU GNI, plus an additional 0.11% linked to the repayment of NextGenerationEU debt. In practice, this is more or less the same level as the current Multiannual Financial Framework.
At the same time, the proposal does not adequately address the needs of the outermost regions, which are extremely important for countries such as Spain, Portugal and France. The Commission also merged the common agricultural policy and cohesion policy, reduced the European Social Fund and, in our view, failed to provide sufficient resources for new priorities such as competitiveness, security and defence.
Another key issue for Parliament is the role of citizens, municipalities and regions. In the Commission proposal, that dimension is largely absent.
“We agree that flexibility is necessary, but the flexibility proposed by the Commission is, essentially, flexibility for the Commission itself”
We agree that flexibility is necessary, but the flexibility proposed by the Commission is, essentially, flexibility for the Commission itself. Around 25% of the funds remain unallocated and can be distributed over the seven-year period at the Commission’s discretion. Parliament does not believe this is the right starting point for the next Multiannual Financial Framework.
What we see in the proposal is, in essence, an architecture similar to that of the Recovery and Resilience Facility. The European Court of Auditors itself has criticised several aspects of that model.
As a result, Parliament began working internally to build a majority position and prepare for the negotiations. Over the past nine months, we worked closely with all the relevant committees and with the pro-European political groups, particularly the Greens and Renew Europe, whose shadow rapporteurs played an important role.
Last month, we voted first in the Budget Committee, in Brussels, and then in plenary, in Strasbourg.
Parliament’s proposal introduces several important changes. First, on the overall size of the budget, we propose increasing it to 1.27% of EU GNI, in addition to the NextGenerationEU repayments. This would represent roughly an additional €169 billion. We allocated this increase across Headings 1, 2 and 3, without shifting resources from one to another.
We also propose strengthening Parliament’s role as the budgetary and democratic oversight authority, while reinforcing the role of citizens and local actors.
Our proposal includes increases for cohesion policy, agriculture, the European Social Fund and the Competitiveness Fund. We also propose strengthening programmes such as LIFE and EU4Health, with around €10 billion more for health policy. The Commission proposal also includes new own resources, and this is now one of the central debates. Today, for example, Parliament is debating online gambling taxation in plenary.
The basic reality is simple: it is impossible to do more with less. Europe faces new challenges, and Parliament believes this is the key issue at this stage.
Tavares argues in the European Parliament for the need to strengthen the Union’s own resources. Photo: European Parliament
What about common debt? Recently, Friedrich Merz argued that a permanent common European debt mechanism is impossible. Could common debt still be a way to increase the EU’s financial capacity?
Parliament’s position leaves the door open to common debt instruments, particularly in areas such as security and defence. However, our priority is first to advance the discussion on new own resources. Before moving towards additional debt, we need to seriously address the revenue side.
The Commission proposal already includes several ideas in this area, and Parliament believes the Council must reopen the discussion on own resources. We know this has been politically difficult since 2020, but it is unavoidable.
Parliament has proposed several new ideas, including digital taxes on online platforms and companies, taxes linked to online gambling, crypto-assets, and mechanisms connected to revenues from the Carbon Border Adjustment Mechanism and the emissions trading system.
“Common debt must remain an option. But first we need to exhaust the possibilities around new own resources”
The Commission also proposed taxes linked to cars and tobacco, although we know these will face strong resistance in the Council because unanimity is required. So yes, Parliament believes common debt must remain an option. But first we need to exhaust the possibilities around new own resources.
Is there broad agreement among the pro-European majority —S&D, EPP, Renew and the Greens— on these new resources?
Yes. If you look at the voting results over the past months, it is clear that the two rapporteurs worked closely with the Greens and Renew throughout the process. Among these four pro-European political groups there is broad alignment on the need for new own resources.
We all understand that without new own resources, the EU’s traditional policies will face cuts. It will be impossible to properly finance competitiveness, security and defence while also protecting policies such as cohesion, agriculture and the European Social Fund.
The Portuguese MEP takes part in the budget debate on cohesion, competitiveness and agriculture. Photo: European Parliament
There is currently a major debate in Brussels: cohesion or competitiveness?
In reality, cohesion and competitiveness are two sides of the same coin. I was a mayor for many years, and I strongly believe you cannot have cohesion without competitiveness, and you cannot have competitiveness without cohesion.
Of course, cohesion policy must evolve and modernise in order to respond to new challenges. But eliminating or weakening it would be a serious mistake.
In many countries, increased competitiveness was only possible because cohesion policies created the conditions for it. Germany is a clear example.
So, for Parliament, the idea of opposing cohesion and competitiveness simply makes no sense.
And what about the future of the common agricultural policy?
Parliament is strongly committed to protecting agriculture and the CAP in the next Multiannual Financial Framework. At the same time, agriculture must become more connected to competitiveness and food security. Today, food security has become a strategic issue for all member states.
That means modernising agriculture and giving farmers the tools they need to adapt. Europe must reduce its dependencies on external actors, including the United States and others. Strategic autonomy also means food autonomy.
This is why Parliament proposes increasing support for agriculture in the next budget. The letter sent during the summer by the leaders of the EPP, S&D, Renew and the Greens to President Von der Leyen was very important in this regard, especially concerning national and regional plans. The Commission’s response on agriculture was significant, particularly after the debates surrounding Mercosur.
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Another important issue is the role of regions in managing EU funds. Countries such as Spain, Germany, Italy and Portugal are worried about a possible renationalisation of the budget following the Recovery and Resilience Facility model.
Parliament’s position on this issue is extremely clear. Interestingly, within the REGI Committee there was almost complete unanimity —from the radical right to the radical left— on the importance of regions.
Over the past months, Parliament worked very closely with the European Committee of the Regions, which helped build a strong institutional position. Municipalities and regional authorities across Europe were deeply involved.
Parliament will find it very difficult to give its consent to the next Multiannual Financial Framework if the role of regions and municipalities is not clearly guaranteed.
“We do not support replicating the governance model of the Recovery and Resilience Facility”
We do not support replicating the governance model of the Recovery and Resilience Facility. The European Court of Auditors has repeatedly criticised that model, particularly the lack of territorial proximity and local participation.
As a former mayor, I worked extensively with both the Multiannual Financial Framework and the Recovery and Resilience Facility. The mechanism was essential during the crisis, but implementation often excluded local and regional authorities. And now, when we examine implementation rates, it is clear that something did not work properly.
In my country, involving municipalities and regions from the beginning would have significantly improved implementation.
In 2027 there will be major elections in Europe: Spain, France, Italy, Poland. Are you concerned this could complicate the negotiations?
Yes. Parliament is very concerned about the electoral calendar. Elections always complicate negotiations because governments become more cautious and political uncertainty increases.
That is why Parliament wants the negotiations to begin as soon as possible. We are now waiting for the Council’s negotiating box with the figures, which we expect around June.
There is still a great deal of informal work to be done before the formal negotiations begin, but time is running short.
The combination of elections and a new Multiannual Financial Framework architecture makes the process even more difficult.
More broadly, relations between the EPP and S&D seem more difficult in this legislature.
On the Multiannual Financial Framework, cooperation has actually been very good. Working with Siegfried Mureșan from the EPP has not always been easy internally for either of us, but we both understand the importance of defending Europe’s broader interests.
In other committees, the situation can be more complicated. On some files, the EPP is clearly closer to the radical right than to S&D.
“We need to constantly build bridges and seek consensus among pro-European forces”
But Parliament increasingly reflects the political fragmentation we see in our member states. In Portugal, for example, politics has changed dramatically in recent years. That means we need to constantly build bridges and seek consensus among pro-European forces. Sometimes it is difficult, and sometimes compromises are imperfect, but without majorities nothing is possible.
The regional elections in Germany later this year could also significantly affect Merz and the CDU, which would have consequences for the whole EU.
Absolutely. The political situation inside Parliament is increasingly complex.
But personalities also matter. Working with moderate colleagues makes a huge difference.
Of course there are tensions and disagreements, but in the end we continue working together because we understand what is at stake for Europe.
Thank you very much.
