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Finland calls for moderation in EU budget and supports funding allocation for defence, competitiveness and Ukraine

Finnish Government

Government Communications Department
Publication date 16.7.2025
Type:Press release

Finland believes that the overall level of the European Commission's proposal for the EU's next multiannual financial framework for 2028-2034 is too high. Finland considers the proposed priorities to be steps in the right direction. The Government will formulate a more detailed position on the proposals in early autumn.

The European Commission published today its proposal for the EU's next multiannual financial framework for 2028-2034. As expected, the Commission is proposing a significant raise to the current overall level.

The Commission proposes a significant restructuring and simplification of the multiannual financial framework. Finland agrees with this objective and has called for allocating funds in ways that align more strongly than at present with the EU's key political priorities, such as improving Europe's defence and competitiveness.

We must remember the big picture

"The world around us has changed in unprecedented ways in recent years. Russia's invasion of Ukraine, the need to strengthen European defence, the increasing trade policy tensions, climate change, technological advances and the challenged competitiveness of the EU are immense challenges that should be tackled together," Prime Minister Petteri Orpo said.

"The EU's multiannual budget must offer the best possible tools for addressing these challenges," Prime Minister Orpo said.

"Many of the Commission's proposals are positive and align with Finland's objectives. At the same time, it is clear that we must continue to exert influence on many matters, especially, to curb the overall framework level, to safeguard funding for our agriculture and to ensure that Finland's special position as Russia's neighbour will be reflected on the allocation of EU funding," Prime Minister Orpo said.

"However, this is only the first step in a long process where Finland will continue its strong and effective efforts," Prime Minister Orpo said.

Finland's proactive efforts to exert influence on the framework content were successful

According to the Commission's proposal, stronger European defence would be financed from different sections of the financial framework, including military mobility and defence research. The Commission also proposes that the EU continue to support Ukraine at the current strong level.

The Commission proposes a new competitiveness fund to boost the EU's competitiveness. The current framework programme for research and innovation, Horizon Europe, would be tied in with the new fund to a great extent. In this respect, the Commission's proposal is to double the current budget and refocus it on defence research and bioeconomy, among other fields. The proposal would significantly raise the level of funding for home affairs and introduce a border with Russia as a particularly favourable allocation criterion.

"The EU will continue its strong support for Ukraine in the long term. It will increase funding for defence fivefold and for military mobility tenfold and double the current level of research and innovation funding. Competitiveness investments in biotechnology and bioeconomy will increase fivefold. From Finland's perspective, these are highly important priorities for EU-level funding. The manifold increase in military mobility funding, especially, will create new opportunities for Finland," Prime Minister Orpo said.

"For us in Finland, it is particularly important that our unique position as Russia's neighbour will be reflected on the allocation of funds and that our views have been heard," said Prime Minister Orpo.

Prime Minister Orpo also mentions that in future the link between EU funding and respect for the rule of law would be stronger than at present.

"Finland feels strongly about this - countries that do not respect the EU's fundamental values should not get EU funding," Prime Minister Orpo said.

Finland is critical of the overall level of the EU's multiannual budget and of new financial instruments such as the recovery instrument

The Commission proposes greater flexibility for EU financing to allow easier redirection of EU funds according changing needs and possible crises. It proposes a new crisis instrument outside the financial framework that would enable the granting of loan-based support to Member States facing special types of crises. The Commission further proposes that loans could be used to get additional funding for national plans within the financial framework.

"While the priorities are relevant, the overall level should remain moderate. That is why we are taking a critical stance on the proposed overall framework level and opposing the creation of new EU-level financial instruments, like the recovery instrument, that are financed by EU borrowing," Prime Minister Petteri Orpo said.

Common agricultural policy funding would be reformed

The Commission proposes a significant overhaul of the common agricultural policy funding and the abolishment of the current pillar structure.

"Our key message is that it must be possible to practise agriculture in a profitable way even in Finland's difficult conditions. It is very important to us that we can secure funding that affects our farmers' incomes," Prime Minister Orpo said.

"The proposal has many elements that we hold important, such as support for areas facing natural constraints, support for young farmers, voluntary coupled support and agricultural investments," Orpo said.

The proposal will be followed by a long negotiation process

The Commission presented its key proposals for the forthcoming multiannual financial framework (MFF) package on Wednesday 16 July 2025. The multiannual financial framework will determine how much EU funding will be available in 2028-2034 and how the funds will be allocated. The MFF package has also a revenue side, that is, a proposal for a system of the EU's own resources.

The Commission's proposal will be followed by a long negotiation process. Negotiations at the ministerial level will take place in the General Affairs Council, while the EU heads of state and government will agree unanimously on the package at a European Council meeting, although probably not until the first half of 2027.