‘Unacceptable’: Von der Leyen’s €2 Trillion EU Budget Blasted By Germany Amid Botched Rollout

In a huge embarrassment for EU leadership, the day following European Commission chief Ursula von der Leyen having presented an ambitious some 2 trillion euro, seven-year EU budget in Brussels, the government of Germany has made clear its firm rejection, calling the plan “unacceptable”. 

“A comprehensive increase in the EU budget is unacceptable at a time when all member states are making considerable efforts to consolidate their national budgets,” said Stefan Kornelius, spokesperson for Chancellor Friedrich Merz’s government in Berlin late Wednesday. “We will therefore not be able to accept the Commission’s proposal.”

The Commission proposed a central EU budget of €1.816 trillion (excluding COVID-19 borrowing repayments), for the period from 2028 to 2034, which marks a massive increase over the current running budget which was formalized in 2021. “Germany, as the EU’s biggest contributor, would be on the hook for about a quarter of that spending,” Bloomberg underscores.

Von der Leyen hailed that this marks “a budget for a new era that reflects Europe’s ambitions” – and further she described “the most ambitious EU budget ever: more strategic, flexible, and transparent. We are investing more in our independence and in our capacity to respond,” according to the statement.

The European Commission has proposed three new taxes, specifically on electronic waste, tobacco products, and high-revenue companies – in an effort repay the EU’s post-Covid debt, which would require an estimated €25-€30 billion annually.

“We do not support the additional corporate taxation put forward by the Commission,” the German Chancellor’s spokesperson continued from Berlin.

Instead, Berlin is calling for the bloc to stick to the Commission’s existing reform agenda and maintaining a focus on strategic priorities within the EU budget. “This direction is the right one to strengthen Europe for the future,” he added.

German conservative leader Merz has all along been consistent on this. “We need to realign the priorities within the EU budget,” Merz said in late June. “New responsibilities should not automatically lead to more spending… and that’s the real challenge we now face.”

FT describes a horribly botched rollout, with members fed up with von der Leyen’s secretive pressure tactics:

Ursula von der Leyen’s plan for the EU’s biggest ever budget has sparked uproar inside the European Commission, with colleagues warning the president’s ultra-centralized style has already compromised the €2tn cash call.

Prepared for months and largely kept secret from von der Leyen’s team of commissioners, the draft 2028-2034 budget plan prompted rare internal pushback that forced significant concessions in the hours before publication.

The revolt has underscored the long-bubbling resentment at her “rubber stamp” approach towards the commission after years of walled-off decision-making that critics say has made Brussels inflexible and prone to mis-steps.

“I have never seen it this bad,” said one senior diplomat from an EU member state who has worked on the past three budget negotiations. “Nobody knew what they were getting or what they were paying until the last minute.”

As expected, the earliest pushback on Wednesday came from Hungary, with Prime Minister Viktor Orban stating on X, “A shocking new EU budget leak reveals a dangerous gamble: Ukraine would get a massive funding boost, while European farmers lose out. This plan risks sidelining rural Europe and threatening families across the continent. Brussels must not abandon Europe’s farmers to bankroll Ukraine.”

Countries like Hungary, as well as Slovakia and Poland – or other conservative/nationalist leaning populations, won’t be comfortable with more ‘rule of law’ strings attached to funding as well:

Another headline-making novelty in von der Leyen’s proposal is her strong focus on the rule of law. Her first mandate saw her executive freeze billions in EU funds for Hungary and Poland over their democratic backsliding and continued legal breaches.

The freezing, however, only covered a share of the allocated funds to the wayward countries, fuelling criticism that the Commission was carelessly allowing taxpayers’ money to flow despite violations of EU law and fundamental rights.

The disputes left a mark on von der Leyen: she now intends to make all funds, from farming subsidies to social policy, conditional on the respect for the rule of law.

“The rule of law is a must for all funding from the EU budget,” she said on Wednesday.

“We will ensure responsible spending and full accountability, with very strong safeguards, and the right incentives. This serves the citizens.”

So clearly, there are plenty of roadblocks possible, given new proposal must be approved unanimously by all 27 EU member states and passed by the European Parliament in negotiations which would likely unfold over two years.

The budget for 2028-2034 must be approved by the end of 2027- and a lot can happen between now and then, particularly regarding the Russia-Ukraine war. The European Commission plans to include a whopping €100 billion in funding for Ukraine as part of this new budget.

Certainly President Trump has voiced wanting to see peace break out long before then, but these efforts haven’t amounted to anything so far. Hungary and Slovakia will have much to say too.