Unbundling aid to Kyiv from the multi-year budget. Orbán cheers the European Commission’s ‘Plan B’

Brussels – ‘Uncoupling’ financial support for Ukraine from the multi-year budget: the idea is gaining ground in Brussels as a ‘plan B’ to break the deadlock, created by Hungarian Prime Minister Viktor Orbán during the last European summit on December 15 and 16, on the multi-year budget review. It was such an impasse that European Council President Charles Michel was forced to convene an extraordinary European Council on Feb. 1 to reach an agreement.

Support for Ukraine, migration and external size, the Strategic Technologies for Europe platform, the NextGenerationEU recovery fund, interest payments, special instruments, new own resources and elements that reduce the impact on national budgets: this is the compromise package (‘negobox’) put on the table by Michel for review. In essence, the EU budget increase would reach 64.6 billion euros, including 33 billion in loans and 10.6 billion in grants from resources in the existing framework.

Michel pledged to maintain resources for Ukraine at 50 billion euros (including 17 billion euros in grants and 33 billion euros in loans); 2 billion for migration and border management; and 7.6 billion for the neighborhood and the world; 1.5 billion for the European Defense Fund under the new Step instrument (Strategic Technology Platform for Europe); another 2 billion for the Flexibility Instrument; and finally 1.5 billion for the Solidarity and Aid Reserve.

Orban has held the entire resource package hostage, saying he opposes the new €50 billion financial instrument for Kiev. One possible solution – which emerged as early as during the December negotiations – would be to release the 50 billion in support for Ukraine in a separate instrument and leave only the coverage of EU priorities to the budget review. This could also overcome the obstacle of unanimity required for the green light on financial matters, paving the way for a 26-way agreement on the new instrument for Kyiv.

“It’s good to see that the EU Commission is preparing a plan B for the 1st of February, according to which financial support given to #Ukraine could be managed outside the EU-budget. This is a good decision! The Commission’s plan B is the Hungarian plan A!” the Hungarian prime minister said in a post on X today, confirming that the hypothesis is more than concrete. The European Commission itself is working on an “operational solution” to reach a political agreement, as President Ursula von der Leyen confirmed at a press conference presenting the priorities of the Belgian presidency at the helm of the EU.