Von der Leyen is investing major political capital in radically reforming the EU’s budget, currently worth €1.2 trillion, for the 2028-2034 cycle.
The plan to steer billions in EU funding away from agriculture and regional spending and toward defense and innovation, however, is sending shockwaves through Brussels and across national capitals.
Months of simmering tensions inside the Berlaymont are now at a boiling point ahead of the Commission’s presentation of its budget proposal on July 16.
Von der Leyen supports overhauling a set of criteria ― known as the Berlin formula ― that allocates a major share of the cohesion cash to underdeveloped regions across the bloc, two EU officials and two EU diplomats told POLITICO.
“The first question is: Will [the Berlin formula] be kept or not?” Jan Olbrycht, a former MEP now serving as an advisor to budget commissioner Piotr Serafin, said during a public event last week. “My answer for today is ‘I don’t know’, and I’m not sure it will be kept like this.”
Changing the rules could result in the Commission handing the money directly to national governments, which would have more leeway over how to allocate the funding to regions. Critics view this as problematic, as it could reinforce existing disparities within individual countries and sideline regions from the process.
