Mega-Funds, Mega-Problems – What Could the EU’s New Budget Plan Mean for Central Europe?
HIIA Analysis – Written by Pál Attila Illés & Ágnes Vass
The European Commission’s new budget proposal for the 2028–2034 period would bring a radical change to cohesion policy: the long-standing separate funds—including cohesion, agricultural, fisheries, and social subsidies—would be merged into a single “mega-fund.” According to the Commission, this would result in simplification and a more efficient allocation of resources, while critics argue that it could spark fierce competition among different stakeholders—primarily farmers, municipalities, and regions—for funding. The change would fundamentally affect the long-established model in which local authorities had a say in the planning and use of resources. In a centralized, top-down system, the role of member states and regions would be significantly reduced, potentially leading to a serious democratic deficit. Although the proposal includes a safety net for the poorest regions, support for the intermediate categories would grow precarious. This means that the less developed—though not the poorest—areas could easily be sidelined. The essence of the reform is a strong centralization that amplifies political battles over EU resource allocation while weakening the autonomy of the regions. A key issue in the negotiations will be whether safeguards can be built into the system to ensure a predictable and fair distribution of cohesion funds, or whether the new model will indeed become an arena for “competition over the common pot,” putting Central European regions at a disadvantage in several ways.
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