Two Europes, One Budget: How the EU’s Next Trillion Redraws Power

Winners and Losers

The geography of the budget tells its own story. Germany, France, and the Netherlands remain the EU’s biggest net contributors — Germany alone pays in about €21 billion more than it receives, roughly 0.6 percent of its national income. On the other side, Poland, Romania, and Hungary continue as top net beneficiaries: Poland draws nearly €13 billion, Romania around €6 billion, and Hungary roughly €4 billion, equal to more than 3 percent of its GDP.

But where the money goes next matters more than who gets it. Large portions of future cohesion envelopes will now be “performance-based,” meaning funds can be withheld if reforms stall or governance metrics slip. In theory, that rewards efficiency. In practice, it gives Brussels new discretion — and quietly sidelines regions where politics are already strained.

“Flexibility must not mean political discretion,” Poland’s regional development ministry warned in an October statement responding to the draft framework.

The Commission’s Logic

The Commission argues that Europe cannot keep its twentieth-century balance sheet in a twenty-first-century security environment. A July 2025 communication framed the proposal as a “strategic reallocation,” saying that “cohesion is no longer only about bridges and roads, but about resilience.”

Officials point to Russia’s invasion of Ukraine, climate shocks, and Europe’s race for industrial sovereignty. Cohesion, they insist, must evolve or become irrelevant.

Critics Push Back

Budget analysts across the bloc call this less reform than retreat. CaixaBank Research described the 2028–2034 plan as “a political rather than an economic realignment,” warning that military and migration spending “risk displacing Europe’s integrative core.”

At IW Köln, economist Berthold Busch noted that cohesion’s stabilizing role “could erode precisely in those member states where EU legitimacy already rests on fiscal support.”

The European Court of Auditors, in its 2025 report, also flagged the shift, questioning how “performance-based” targets will be measured and whether they could deepen inequalities among regions.

And in Strasbourg, several MEPs from the Budget Committee accused the Commission of “creating two classes of Europe — one that builds factories and one that guards borders.”

Even among pro-integration voices, discomfort is visible. “Defence and migration are real priorities,” said Greek MEP Eleni Karamidou, “but the Union’s soul was built on convergence, not conditionality.”