Socialists warn von der Leyen on EU budget: “No to centralization’

Brussels – The barrage of attacks against the draft new EU budget continues. The front opposing Ursula von der Leyen’s centralisation plans is growing wider. In addition to local authorities, farmers, and member states, the European Parliament, has also started pushing back against the “new MFF”, including heavyweights of the pro-European majority that theoretically supports the Commission, but that in recent weeks has been shaky because of the growing tensions between the Socialists and the Populars, in addition to those between the hemicycle and the Berlaymont president.

The political climate in the European Parliament is increasingly tense, and the so-called ‘Ursula Majority‘ is paying the price, showing more and more signs of strain. In a letter dated yesterday (1 July), the Socialist group leader Iratxe García Pérez and MEPs Carla Tavares, Mohamed Chahim, and Jean-Marc Germain issued yet another warning to Ursula von der Leyen.

The issue at stake is the new EU budget for 2028-2034 – properly called the Multiannual Financial Framework (MFF) – which the president will be proposing along the model of the Recovery fund (RRF). The Commission’s formal proposal is scheduled for 16 July, while negotiations between the co-legislators (the European Parliament and the Council) are expected to start after the summer.

The Socialists “strongly” oppose the “one national plan per member state” approach, one of the main pillars of von der Leyen’s restructuring for the next seven-year budget, which would move from a plethora of EU-funded programs (currently over 530) to 27 national plans. Each chancellery would then have its own unique allowance, and disbursements would depend on the achievement of objectives, targets, and milestones, just as with the NRPs.

The S&D disagree, opposing the “payments against reforms” formula and the merger of cohesion policy with the Common Agricultural Policy (CAP), which farmers and an increasing number of member states oppose. Both spending chapters (each worth about one-third of the EU budget) must continue to follow a “bottom-up approach”. They cannot be “diluted into national plans” nor “subjected to conditionality,” according to the letter. 

In addition, the Social Democrats call for “a separate, self-standing, strong European Social Fund” with earmarked funding for key social priorities to support Brussels’ action to protect labour and socio-economic rights. In general, the center-left’s reported need is for a “much bigger and better upcoming EU multiannual budget, which should go beyond the current level of 1% of the EU-27’s Gross National Income in order to fund new priorities without cutting or redirecting means from core EU programs”.

The perplexities of the Socialists almost perfectly overlap those raised by the European People’s Party (EPP), of which von der Leyen is a member, caught in friendly fire in the aftermath of the presentation of the guidelines for the next MFF. After all, the series of ‘no’ votes from the two largest groups in the House aligns with the stance of the European Parliament.

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The S&D group is on the barricades not only against the president of the Commission but against the entire EPP, which is guilty of having sided with the extreme right in the hemicycle to undermine the Green Deal. To the point that qualified sources from the socialist camp suggest that the centre-left may pull the plug on the von der Leyen College (pulling out of the majority with Populars and Liberals) should the government of Spanish Prime Minister Pedro Sánchez fall.

Von der Leyen may also have to watch her back against a censorship motion by a party of the radical right (the Romanian AUR, a member of the ECR along with Fratelli d’Italia, and the Polish PiS) which, if it reaches a sufficient number of signatures, could end up on the plenary table as early as next week. Even if it got there, in all likelihood, there would not be the votes to pass the no-confidence motion. However, it would be an important political signal, which risks producing a break within the pro-European majority, especially within the ranks of the Socialists and Liberals, but perhaps also within the EPP itself.

Since the fall, when the first rumors about the Commission’s revolutionary plans began to circulate, the European Committee of the Regions (CoR) has sounding alarms about the 2028–2034 budget. President Kata Tüttő, who also comes from the social democratic family, branded the new von der Leyen MFF as a Big Ugly Bill, a phrase that negatively echoes Donald Trump’s “Big Beautiful Bill,” the controversial budget law recently approved by the US Senate.

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I have the bad feeling that from behind the smoke of simplification and efficiency a “Big Ugly Bill” will emerge in form of a smaller, weaker raise of shields post 2027

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– Kata Tüttő (@CoR_President) #EUBudget

“I have a bad feeling that behind the smoke screen of simplification and efficiency will emerge a ‘big, bad law’ in the form of a smaller and weaker post-2026 EU budget,” laments Tüttő. “When 14 national governments, 149 regions, and hundreds of local leaders and key actors share profound concerns about the rationale behind the definition of the proposal for the new EU budget, it is time to start a meaningful dialogue,” he added.

Nicola Zingaretti of the Italian PD speaks of the “dangerous drift” the cohesion policy reform seems to be heading towards. “The European Commission would be committing a serious mistake if it chose the path of centralization, entrusting the programming and management of funds exclusively to central governments,” the Dem delegation leader in Strasbourg said, adding that “excluding regions and municipalities means distancing the territories from decisions and compromising the fight against inequalities.”

On the sidelines of the CoR plenary in Brussels today (2 July), representatives from some 30 of the 132 regions that signed an appeal to von der Leyen to leave cohesion policy intact will meet the European Commission’s executive vice-presidents Raffaele Fitto (Cohesion and Reforms portfolio) and Roxana Mînzatu (Labour and Social Rights portfolio).