The European Commission’s proposals for the future EU budget: the place of CLLD/LEADER

As expected, on 16 July 2025, the European Commission published its long awaited proposals for the Multiannual Financial Framework (MFF) for the 2028-2034 period.

Overall, the new budget envelop is € 1 985 billion, not dissimilar to the current period 2021-2027 (€1 074 billion in 2018 prices supplemented by the Recovery and Resilience Fund of € 750 billion). But the new proposal significantly simplifies the EU budget structure, consolidating seven current headings into three main headings:

1. Support to Member States via National and Regional Partnership Plans (NRPs), where the CAP, Cohesion Policy, and programmes like LEADER will be bundled.
2. Support to Beneficiaries and Businesses under a Competitiveness heading.
3. Support to Partners under the Global Europe heading.

The largest part of the MFF budget (€ 1 062 billion) will be programmed by Member States through National and Regional Partnership Plans (one per Member State) covering economic, social and territorial cohesion, agriculture, rural and maritime prosperity and security. It will comprise the current funding under Cohesion Policy, the Home Policy and the CAP. Such integration is expected to facilitate the planning process and make it more aligned with EU’s common priorities. Enhanced flexibility will allow policies to be adapted to regional and local needs and will leave scope for reaction to unexpected events or disasters. A widespread use of simplified costs and results-based payments will be applied to speed up and simplify delivery.

A hot debate now kicks off on the Commission’s proposals to be followed by formal negotiations with the European Parliament and European Council. We will be presenting contributions from various organisations and experts on how local development is shaping up within the framework of these proposals and challenges arising for CLLD/LEADER.

ELARD: LEADER recognised, but not guaranteed

In an early reaction to the Commission’s proposals ELARD highlighted that in the presentation of the proposals Commissioner Hansen was reassuring about the future of LEADER. But ELARD has commented that “LEADER might be recognised and included in the next framework, but it might be up to Member States to decide whether to use it or not!! Indeed, there is no ring-fenced budget for LEADER-CLLD in the current structure – neither in the official announcements nor in the leaked legislative drafts, that we had a chance to read. This is alarming. Without mandatory earmarking, Member States could choose not to implement LEADER at all. Even with positive mentions, rural development risks disappearing into a vast, undifferentiated pool of national priorities”.

A New Era for Rural Europe: What the 2028–2034 EU Budget Means for Local Development and rural areas

In its initial presentation of the Commission’s proposals, AEIDL highlighted several topics. Its Key Takeaways for Local and Regional Development are:

At the heart of the new MFF are National and Regional Partnership Plans (NRPPs), which consolidate nearly all EU funding streams into a single, coherent strategy per Member State. This simplification—from over 540 programming documents to just 27 NRPPs and one Interreg Plan—marks a significant shift toward tailored, place-based investment.

Implications:

• Simplified Access: Local authorities and beneficiaries will navigate fewer bureaucratic hurdles, thanks to harmonised rules and a single funding instrument. Ms Von der Leyen gave the example of the difficulty to build a single kindergarten due to the panoply of no less than 50 EU local development instruments available.
• Strategic Flexibility: it is claimed that NRPPs allow Member States to structure plans according to their own administrative and constitutional setups, ensuring that regional and local needs are prioritised. The devil will be on the detail (the draft Regulations, still to be published) about whether the partnership principle, community led, bottom-up local development is just optional.
• Rule of Law Conditionality: Funding is contingent on compliance with EU rule of law and fundamental rights, reinforcing accountability and transparency.

An overview of the Commission’s EU budget proposal and the challenges ahead

In this wide-ranging article, Serafín Pazos-Vidal analyses the new EU budget proposal for 2028-2034 and concludes by highlighting the main challenges for CLLD and lower levels of governance in Member States:

“… to conclude with a governance perspective, the main challenge is political and (co)governance. The new national plans in the new budget represent a decisive step in centralizing decisions regarding European funds (and, therefore, many Member States discretionary investments) in the ministries, namely the Ministry of Finance which is the one that separately negotiates the MFF.

Likewise, the many ministries that for the first time tasted the benefits of European funds thanks to the Recovery Plan will want to continue doing so, relegating the autonomous regions to executive bodies for initiatives designed from the Central government, even within their own sphere of competence.  We have seen this already in federal states such as Germany with the present CAP Strategic Plans and is particularly concerning for Members States with a weak culture of multilevel governance such as Spain.

While the partnership principle is nominally in place (as has been extended to a variety social actors)  following the calls from the European Community of Practice on Partnership this remains pro-forma as most decisions will remain even more decisively in hands of national ministries than at present.

Similarly, with respect to LEADER, while the various calls among the Local Develoment community have bene successful, it nominally remains under the successor of the present CAP Pillar I (i.e. DG AGRI), the fact is that most of what is now Pillar II, is primarily at the discretion of Member States to programme and earmark funds within their NRPPs for non-farm expenditure. Let’ s recall that according to the Commission at present not 5% but 8% of CAP is spent beyond agriculture. Pending the legislative work of MEPs and Council starting in September there is at present no guarantee of an earmark for rural (or indeed urban development).

Last but not least, the current period saw a minor victory in the first-ever definition of depopulation as demographic decline across Europe and not just as low density to benefit sparsely populated areas in Nordic countries. Unsurprisingly, the hard-fought ERDF definition to target funds to those areas was also erased in the new Regulations, despite the fact that in the 9^th Cohesion Report the Commission came up with a more suitable definition to a problem affecting large swathes of the European territory.”

Turning budgets into impact: Europe’s next cohesion challenge

In October 2025 Spatial Foresight published a commentary by Kaisa Lähteenmäki-Smith & Kai Böhme on the European Commission’s proposal for the post-2027 MFF in which it stressed that:

“The Commission’s MFF proposal introduces structural changes — National and Regional Partnership (NRP) Plans, large strategic funds and a significantly enlarged crisis/resilience instrument — that materially increase the potential for mission-oriented, cross-sectoral and resilience/wellbeing focused policy. But realising that potential depends on how the Commission and Member States translate the new instruments into Plan requirements, governance arrangements, outcome metrics and adaptive financing tools. The proposal provides the architecture; implementation choices will decide whether the EU actually spends for impact and wellbeing, rather than just re-labelling inputs.

All these changes are intended to make the MFF more effective in addressing the above challenges. This calls for discussing the MFF proposal in the context of impact-based policy design and delivery. Along these lines of thinking, there are a number of potential scenarios for utilising the structural enablers underlying the EU budget proposal”.

The authors sketched out the first scenario called “Partnership Plans as a vehicle for impact-driven EU policy”. From a positive perspective they commented that …

“… the NRP Plans could provide an apt opportunity and turning point towards more impact-based policymaking. In order to pass Europe’s stress test, the NRP Plans must function as ‘impact compacts’, which are time-bounded, multi-actor agreements that bind ministries, regions, cities, agencies and social partners to a small set of shared outcomes (e.g. reducing excess mortality in underperforming regions, decarbonising heating for low-income households and halving skills mismatches in areas undergoing industrial transition). They would:

• Align EU, national and regional trajectories on wellbeing, sustainability, and resilience. This is the main rationale and “why” behind investments.
• Sequence reforms and investments across policy fields (transport, energy, health, social policy and research and innovation), replacing one-off projects with coherent, mission-style portfolios. Lessons from integrated policy approaches in various parts of the EU and beyond demonstrate the advantages and limitations of this coordinated approach.
• Provide a single mechanism for monitoring of outcomes trajectories – not just financial absorption – at meaningful territorial scales.
• Build the basis for anticipatory governance by embedding foresight, risk scanning and adaptive reallocations.
• Ensure a rigorously place-based approach, with co-design and implementation by regional and local stakeholders who are best placed to understand the territorial conditions”.

The full commentary is available HERE.