German leader Friedrich Merz has formed a six nation alliance demanding deep cuts to the European Union's proposed 2 trillion euro multiannual budget.
Merz hosted leaders from Germany, the Netherlands, Denmark, Austria, Finland, and Sweden in Berlin to forge a joint stance ahead of negotiations in Brussels. The group of self-styled frugal nations agreed to demand reductions of several hundred billion euros from the long term spending plan put forward by the European Commission for the 2028 to 2034 period.
Germany had already requested a cut of around 400 billion euros from the proposal in June. The formation of the new six nation coalition signals that Berlin does not intend to back down easily as it attempts to turn its domestic fiscal stance into the shared negotiating position of key EU powers.
The six member states argued that the European budget must remain financially sustainable at a time when national governments are enforcing difficult fiscal policies at home. They stated that available EU funds should be redirected toward strategic priorities such as defense, competitiveness, migration, and European sovereignty, while firmly rejecting any new joint EU borrowing to finance the budget.
The EU multiannual budget, known as the Multiannual Financial Framework, sets seven year spending limits across all policy areas for the 27 member bloc. Proposed by the European Commission, the executive arm of the EU, the budget requires unanimous agreement among member states and approval from the European Parliament to take effect.
Struggle over European spending priorities
The position of the frugal bloc sets up a direct clash with another group of EU member states that is pushing for a larger European budget. Opposing nations are seeking to safeguard funding for cohesion policy, which supports poorer regions, alongside traditional spending programs such as agriculture.
The upcoming negotiations in Brussels will determine both the overall size of the budget and the specific areas where European funds will be directed. Talks are set to cover defense financing, economic competitiveness, agricultural policy, regional cohesion, and potential new sources of revenue for the EU.
