City leaders in the Eurocities network are concerned that the European Commission’s proposals for the next seven-year EU budget could lead to the increased centralisation of EU funds and risk further side-lining cities.
The EU budget proposals for 2028-2034, announced by the Commission yesterday, include 27 National and Regional Partnership Plans which are intended to include cohesion funding and agricultural subsidies. The Commission says these plans will simplify the budget and reduce imbalances across the EU.
However, city leaders state that without a robust multi-level governance, and clear earmarking for sustainable urban development, the EU risks repeating the mistakes of the Recovery and Resilience Facility, when EU funds have been centrally managed at national level, hindering cities’ efforts to achieve EU policy objectives.
Local and regional governments understand what is needed on the ground and enjoy the highest levels of public trust. EU funding could be used far more effectively if it were co-designed and implemented in genuine partnership with cities.
It is also unclear how city governments can continue to access EU funds if national governments fail to comply with the EU’s Rule of Law or implement policy reforms.
We call on the EU institutions to work alongside city leaders to ensure that the final budget agreement truly serves the Europe’s future
Overall, for city leaders, the current structure of the budget proposals lacks the robust governance needed to ensure that local governments are empowered to implement the EU’s policy objectives.
“While it is positive that the EU has taken steps to simplify the next seven-year EU budget, the European Commission’s proposals do not give cities guarantees that they will receive the effective support they need to deliver a just, sustainable and prosperous future for the people of Europe,” says Jevgeni Ossinovski, Mayor of Tallinn and Eurocities Shadow Commissioner for the EU Budget.
“We call on the EU institutions to build on the European Commission’s proposal, working alongside city leaders to ensure that the final budget agreement truly serves Europe’s future.”
On a more positive note…
Cities welcome the ambitious proposals for the European Competitiveness Fund and FP10 Regulations (Research and Innovation). They call for the EU to ensure that cities, as testbeds of innovation, are closely involved in their delivery.
In relation to addressing social disparities, the Commission proposes that 14% of national and regional plans focus on social priorities, with €50 billion earmarked for the Social Climate Fund. It is also promising that the European Competitiveness Fund includes a strong emphasis on boosting workers’ skills.
The Commission’s proposal is broadly positive on climate and environmental action, with a number of planned measures, including a larger budget for investment in energy infrastructure and grids in the Connecting Europe Facility, and an average target of 35% for green transition spending across the entire budget. There are also dedicated policy windows on the clean transition and industrial decarbonisation, and on resilience in the FP10 (Horizon Europe) and the new Competitiveness Fund.
Although housing is not explicitly mentioned, it is encouraging to see the possibility to support and finance social and affordable housing through tailored regional or national plans that reflect local needs.
Through the new Agora EU programme, cities also welcome the proposal to double the culture budget and commend the efforts made to achieve this goal.
We believe we are still far from a budget that fully addresses our needs, namely the housing crisis
“We the cities stand ready to be part of the negotiations for the MFF, following yesterday’s proposal by the European Commission,” says Jaume Collboni, Vice President of Eurocities and Mayor of Barcelona. “We believe we are still far from a budget that fully addresses our needs, namely the housing crisis. We will build upon the crucial work of mayors in the Mayors4Housing Alliance to ensure that bold action in housing for cities is reflected in the EU budget.
“We will also work for the inclusion of mandatory urban chapters in the 27 national and regional plans and cohesion funding that is specifically for city governments. If the EU is to show the first-ever EU Policy Agenda for Cities is not just a political gesture, they must ensure that the budget gives cities the dedicated resources they need to bring a real change.”
EU ambitions and local delivery: Bridging the gap
Ahead of the announcement of the proposals for the post-2027 EU budget, city leaders stated that multilevel governance must be strengthened to better tailor EU policies to cities’ specific needs. They also called for a renewed Cohesion Policy to remain at the core of the EU’s investment strategy, with the inclusion of a dedicated urban chapter in all national and regional plans and for at least 15% earmarking for urban priorities.
However, the proposals for the National and Regional Partnership Plans have not included these guarantees, leaving cities uncertain about their future role and access.
As the focus turns to negotiations between the EU institutions, city leaders call for the European Council and the European Parliament to make essential adjustments to the Commission’s budget proposals:
Ensuring multi-level governance and access to EU funds
City leaders are calling for reforms and investments to be defined through a multilevel governance approach. There must be safeguards in the National and Regional Partnerships Plans to ensure mandatory cooperation with local governments in the design and implementation of the plan.
The EU institutions must take urgent action to ensure that city governments are not penalised due to the mistakes of their national governments
The inclusion of a territorial chapter in national and regional plans is a welcome step. However, it must explicitly include an urban dimension and be established as a mandatory requirement, not merely an option left to the discretion of central governments. Additionally, there must be a clear and enforceable safeguarding mechanism to ensure that local and regional authorities can directly access EU funds, especially in cases where national governments delay or restrict disbursements.
“The EU institutions must take urgent action to ensure that city governments are not penalised due to the mistakes of their national governments, says Aleksandra Dulkiewicz, Mayor of Gdansk and Eurocities Shadow Commissioner for the EU Budget. “This not only risks stalling local efforts for stronger cities, more inclusive communities, smarter services, and stronger local economies, but also poses a serious threat to democratic governance in Europe.
“Side-lining local governments undermines the principle of multilevel democracy and weakens the direct connection between EU investment and citizens’ everyday lives.”
Recognising cities’ key role for EU competitiveness
City leaders welcome the ambitious proposals for the European Competitiveness Fund and FP10 Regulations, designed to close the EU’s innovation and productivity gap, which is key to addressing imbalances between European cities and regions. It is also a positive step that the FP10 will continue supporting the EU Missions until 2030.
However, cities make it clear that innovation and competitiveness take place locally through public-private partnerships, infrastructure development and job creation. While the Commission’s proposals mention local governments, for instance for clean transition and industrial decarbonisation policies in particular for energy, transport and buildings, city leaders are calling for clear cooperation with cities.
The new Competitiveness Fund and FP10 must formally involve cities in shaping priorities and decisions
They also ask the EU institutions to involve local governments as partners in setting priorities and delivering on the ECF and FP10, as well as strengthening place-based innovation.
“Competitiveness starts in cities,” says Jevgeni Ossinovski. “Whether through public-private partnerships, research ecosystems or skills development, local governments are at the core of Europe’s innovation capacity. To close the EU’s productivity gap and deliver real impact on the ground, the new Competitiveness Fund and FP10 must formally involve cities in shaping priorities and decisions. Without a clear territorial approach, these tools risk missing their mark.”
