On the proposal for a regulation of the European Parliament and of the Council amending Regulations (EU) 2021/1058 and (EU) 2021/1056 as regards specific measures to address strategic challenges in the context of the mid-term review

BUDGETARY ASSESSMENT

for the Committee on Regional Development on the proposal for the proposal for a regulation of the European Parliament and of the Council amending Regulations (EU) 2021/1058 and (EU) 2021/1056 as regards specific measures to address strategic challenges in the context of the mid-term review

(COM(2025)0123 – C100063/2025 – 2025/0084(COD))

The Committee on Budgets has carried out a budgetary assessment of the proposal under Rule 58 of the Rules of Procedure and has reached the following conclusions:

The Committee on Budgets,

A. whereas the proposal does not modify existing budgetary commitments and remains within the limits of the overall allocations for the period 2021-2027 and is therefore budgetary neutral;

B. whereas the combined effect of an exceptional one-off 30 % pre-financing and 100 % co-financing on new EU priorities, additional one-off pre-financing of 4.5 % (9.5 % for NUTS 2 regions that have borders with Russia, Belarus or Ukraine) for programmes that reallocate at least 15 % of their resources to the new priorities leads to a partial frontloading of estimated payment appropriations of EUR 3,6 billion in 2026, followed by lower payments in 2027;

Conclusions of the budgetary assessment

1. Determines that the proposal is compatible with the MFF Regulation; notes that the proposed measures are voluntary and do not involve any top-up of the initial allocation available to Member States;

2. Considers that the proposal is compatible with the budgetary principles laid down in the Financial Regulation; notes, however, that the pre-financing paid in 2026 will be counted as payments made in 2025 for the purposes of calculating the amounts to be decommitted;

3. Notes that the Commission does not expect any implications for the budget for 2025; expects the Commission to take into account the current proposal and the updated payment needs for ERDF and Cohesion Fund in the budgetary procedure for 2026 following the actual re-programming by Member States and to keep the European Parliament informed in a timely manner about the evolution of the mid-term review in the Member States;

Recommendations as regards budget implementation

4. Notes that the proposal provides further flexibility and introduces incentives to Member States in the context of the mid-term review of cohesion policy to address strategic challenges the EU is facing by redirecting resources to new EU priorities notably strengthening the defence capabilities, including their value chain, and overall competitiveness of European companies; regrets that cohesion policy is again used as a flexibility response tool and maintains that this approach risks undermining its longer-term policy and investment objectives; regrets that the Commission did not perform an impact assessment of the changes; acknowledges that the proposal offers a pragmatic yet unsatisfactory way forward for dealing with insufficient budgetary flexibility and response capacity in the EU budget;

5. Recalls that the next MFF should ensure the existence of sufficient budgetary reserves to respond to new challenges faced by the EU, including climate disasters, military conflicts on European soil, or any developments that could significantly affect the Union; underlines that the combined effect of a minimum of 15 % of resources to be re-allocated and the lifting of the 20 % ceiling for transfer towards STEP objectives can negatively impact the achievements of targets initially set due to discontinuity of matching objectives with resources;

6. Notes that payments to 2021-2027 cohesion policy programmes were on a very low level in the first years of implementation leading to an increase of payment needs towards the later years; recalls that this actual payment cycle does not coincide with the more linear payment profile set out in the MFF Regulation and that this situation results in a risk of exceeding payment ceilings in the later years; considers that the frontloading of payments towards 2026 could alleviate the pressure on payments;

7. Recalls that the regulation of STEP and amending regulation of RESTORE in 2024 were accompanied by a frontloading of payment appropriations in the budgets for 2024 and for 2025; is concerned, in respect to the payment ceiling, about the large uncertainty on the volume of payment claims in 2026;

8. Recalls that 100 % co-financing without additional resources leads to a lower total amount of financial support through the programme;

9. Requests the Commission to provide for traceable information in form of timely reports on transfers to make the impact of the mid-term review clearly identifiable for the budgetary authority;

10. Believes that the proposal could create potentially a loophole allowing the release of European funds blocked due to rule-of-law breaches; calls on the Commission to maintain consistency in applying conditionality across all EU funding streams, and to, accordingly, reject any reallocation of blocked Cohesion Policy funds when it circumvents the rule-of-law-related requirements established in the Common Provisions Regulation;

11. Considers that the effectiveness of the threshold of 15 % re-allocation should be reassessed to ensure sufficient flexibility in order meet the main objectives of the proposal; notes that the proposed condition of the reallocation of at least 15 % of the funds to new priorities may be too high, given the advanced stage of implementation of the MFF;

12. Highlights the importance to prevent double financing and calls on the Member States and the Commission to ensure that support for the new types of investment is in addition to support under other Union programmes, including the EDF, EDIP and SAFE.

AMENDMENT

As part of its budgetary assessment, the Committee on Budgets also submits the following amendment to the proposal:

Amendment 1

Proposal for a regulation

Recital [18] a (new)

Or. en