Opinion on the guidelines for the 2027 budget – Section III

24.2.2026

Mr Johan Van Overtveldt

Chair

Committee on Budgets

BRUSSELS

Subject: Opinion on the guidelines for the 2027 budget – Section III (2025/2246(BUI))

Dear Mr Chair,

Under the procedure referred to above, the Committee on Budgetary Control has been asked to submit an opinion to your committee. At its meeting of 24 February 2026, the committee decided to send the opinion in the form of a letter.

Yours sincerely,

Andreas Schwab Daniel Freund

CONT Chair CONT Member

Rapporteur for the Commission Discharge 2024

OPINION

1. Reaffirms its strong commitment to the fundamental principles and values enshrined in the Treaty on European Union and the Treaty on the Functioning of the European Union;

2. Recalls that respect for the rule of law and fundamental rights is an essential prerequisite for the sound financial management and effective use of EU funds; highlights, therefore, the importance of ensuring, in line with the applicable EU legal framework, including the Rule of Law Conditionality Regulation, that access to EU funds is linked to respect for the rule of law; stresses that this is crucial for safeguarding citizens’ trust in the EU and for ensuring that EU funding delivers tangible benefits across all Member States in an effective and results-oriented manner;

3. Notes with serious concern that shortcomings affecting the rule of law, anti-corruption frameworks and institutional checks and balances in some Member States pose risks to the protection of the financial interests of the EU and the sound management of EU funds; recalls that the Commission has a wide range of instruments at its disposal to address such risks and protect the EU budget; stresses that these instruments should be used in a coherent, consistent and transparent manner; underlines, therefore, the importance of clear benchmarks, verifiable implementation steps and effective monitoring when applying measures under the Rule of Law Conditionality Regulation, the Common Provisions Regulation and the RRF Regulation, as well as any other EU funding instruments, in order to ensure legal certainty and alignment with the Commission’s annual Rule of Law reports;

4. Emphasises that EU funds must be used in full compliance with EU values and must not support activities that undermine democracy and the rule of law; stresses, moreover, the importance of guaranteeing adequate and predictable EU funding to all relevant stakeholders that play a crucial role in safeguarding and promoting the rule of law, democracy and fundamental rights, in accordance with clear eligibility criteria and oversight mechanisms;

5. Recalls that the EU budget should be implemented in line with the principle of transparency; stresses that budgetary control, safeguards and transparency requirements must be applied in a neutral, proportionate and evidence-based way and that effective scrutiny requires the application of equivalent standards to all beneficiaries;

6. Stresses that the sound and timely implementation of the budget contributes to efficiently and effectively addressing the needs and challenges faced by the EU and its citizens in different policy areas, as well as the EU’s global responsibilities; warns that implementing the budget under time pressure may lead to an increase in errors and irregularities, in particular where complex eligibility rules and multi-layered delivery systems apply;

7. Recalls that while existing flexibility arrangements have enabled the EU to respond to emerging priorities, several flexibility instruments were depleted in the early years of the current multiannual financial framework (MFF); reiterates that a certain level of flexibility in the EU budget is necessary to address potential new challenges and crises where EU action could provide added value, while also preserving budgetary discipline; underlines that the flexibility framework is overly complex, lacking a clearly defined and transparent sequence for activating margins below the ceilings and special instruments above them; notes, furthermore, that multiple flexibility tools overlap with one another and with the thematic programmes targeting the same needs, resulting in unnecessary complexity in financial management and decision-making; notes that the headroom in the EU budget is increasingly being used to provide guarantees for the funding to respond to crises, via loans backed by the headroom, and is concerned about the long-term impact of EU commitments on the sustainability of the headroom;

8. Stresses the need to protect the EU budget from any misuse, particularly fraud and corruption, and calls on the Commission to continue to be vigilant and proactive in current and future cases where a lack of respect for EU values and the rule of law affect or threaten to affect the EU’s financial interests; underlines the importance of strengthening the EU anti-fraud architecture and the need to provide increased resources for the European Anti-Fraud Office (OLAF), the European Public Prosecutor’s Office (EPPO), the European Union Agency for Criminal Justice Cooperation (Eurojust) and the European Union Agency for Law Enforcement Cooperation (Europol) in the fight against fraud and corruption and to strengthen the role of these bodies in this regard; stresses the need for effective coordination and cooperation between all these institutions as well as adequate budgets to effectively fulfil their missions;

9. Stresses the need for the Commission to remain vigilant with regard to potential conflicts of interest and to ensure that robust, verifiable safeguards are in place to prevent EU funds from benefiting private interests, whether directly or indirectly; underlines that EU funding should only be disbursed where conflicts of interest are effectively and demonstrably resolved, in line with the relevant legal framework; recalls that effective prevention requires not only ex ante declarations but also continuous monitoring, verification and enforcement throughout the life cycle of EU-funded projects;

10. Notes that while the digital transformation is indispensable to increasing the efficiency, control and transparency of the EU budget, this shift has also heightened the risk of cyber-fraud affecting the financial interests of the EU; calls on the Commission to allocate sufficient funds to strengthen EU digital infrastructure and research and development, while ensuring that investments in cybersecurity are impactful and contribute to the overall protection of the EU’s financial interests, including through secure and interoperable data-mining systems;

11. Notes that while outstanding commitments have decreased compared to the record high levels at the end of 2023 (EUR 543 billion), at the end of 2024 outstanding commitments amounted to EUR 507.4 billion, of which EUR 166.3 billion related to NextGenerationEU (NGEU) grant funding; takes note of the Commission’s latest estimate for the level of outstanding commitments expected at end of 2027 (EUR 339 billion); considers that the risk of decommitments, and the related reduction of EU added value for the EU budget, remains high; calls for improvements in the forecasting of decommitments;

12. Notes with concern that the exposure of the EU’s budget continued to increase in 2024, reflecting the growing volume of borrowing operations and associated guarantees; underlines that this trend underscores the importance of a robust system to ensure that the EU can meet its debt obligations under all circumstances; further notes that the Commission’s proposal for a financial support package for Ukraine for 2026–2027 would introduce a EUR 90 billion EU support loan for Ukraine though the Ukraine Support Loan instrument, financed through common EU borrowing on the capital markets and backed by the EU budget headroom; notes, moreover, that the EU budget will cover the related debt service costs, including funding, issuance, liquidity management and associated administrative costs;

13. Reiterates the need for sustainable and resilient revenue for the EU budget that matches the expenditure side; reiterates its long-standing call for the introduction of new, genuine own resources, not only for NGEU debt repayment but also to finance the EU’s policies; welcomes, in this respect, the Commission’s MFF proposal of July 2025 and efforts to identify new own resources, as well as the calibrations to traditional own resources it has put forward; supports the broader basket approach proposed by the Commission and calls on the Council to swiftly reach an agreement on a basket of new own resources of at least EUR 60 billion per year in order to provide long-term budgetary certainty;

14. Recalls the importance of protecting the EU’s own resources from any fraudulent irregularity; stresses the need to ensure the timely implementation of the EU customs reform, taking into consideration the pertinent recommendations made by the European Court of Auditors in its annual reports concerning the 2024 financial year; considers it imperative to strengthen operational cooperation between the EPPO, OLAF, the customs and tax authorities of the Member States and European law enforcement authorities to detect, prevent and correct fraud affecting EU revenue;

15. Notes that the overall error rate fell from 5.6 % in 2023 to 3.6 % in 2024; stresses, however, that this decrease should be interpreted with caution, as it may not necessarily reflect an improvement in the effectiveness of control systems but could also be influenced by contextual factors such as the end of COVID-19 related emergency spending, a comparatively low level of budgetary implementation in 2024 and the early stage of implementation of the 2021-2027 MFF; notes significant variations in error rates across different budget headings, with some areas reporting error rates below the materiality threshold of 2 %, while the error rate for the heading ‘Cohesion, resilience and values’, though less than the 9.3 % error rate estimated for 2023, remains considerably above the materiality threshold at 5.7 %; is concerned about the persistent shortcomings observed by the European Court of Auditors in the work of certain national audit authorities, as reflected in the weaknesses identified in the assurance packages, with a residual error rate above the materiality threshold in assurance packages that account for more than 60 % of the total value of assurance packages audited in 2024; stresses that recurring weaknesses in the prevention and detection of irregularities at Member State level indicate that managing authorities do not effectively prevent or detect irregularities in expenditure declared by beneficiaries, thereby reducing the extent to which the Commission can rely on their work; calls on the Commission to take action to address the systemic issue of non-detection of errors at Member State level in cohesion policy spending, through a proportionate and risk-based combination of preventive measures, including targeted capacity-building, reinforced supervisory action and when necessary, suspensions or financial corrections in the cases of persistent systemic weaknesses;

16. Is deeply concerned that the European Court of Auditors issued a qualified opinion on the legality and regularity of the Recovery and Resilience Facility (RRF) expenditure in 2024 for the third consecutive year, following similar conclusions in 2022 and 2023, and that it estimates the minimum financial impact of its findings to be above the materiality threshold; expresses concern that the European Court of Auditors found 6 out of 28 RRF payments made in 2024 were impacted by quantitative issues, with 5 of these payments being affected by material errors, calling into question the reliability of the control framework at this stage of implementation; notes that by the end of 2024, payments under the RRF amounted to EUR 197.5 billion out of EUR 358.9 billion in committed grants, leaving up to EUR 161.4 billion still to be disbursed by the end of 2026; notes that this substantial volume of outstanding payments, concentrated in the final two years of the instrument, increases the risk of implementation bottlenecks and further delays, particularly in Member States facing structural capacity constraints; stresses that the timely absorption of the remaining RRF grants will depend on the quality and maturity of reforms and investments, the stability of national governance systems, and the Commission’s ability to process a high volume of payment requests efficiently within a compressed timeframe; calls on the Commission to support the Member States’ authorities in the implementation of funds, in particular where additional administrative capacity is needed, to stimulate absorption and reduce the occurrence of errors; calls on the Commission to transparently inform Parliament about the progress of implementation and absorption of funds and to provide Parliament with regular, structured and comparable updates on RRF implementation, including on corrections and recoveries;

17. Recalls the EU’s commitments to advancing climate and environmental objectives, in line with the Paris Agreement and the European Green Deal; notes that the Commission tracks EU spending on climate- and biodiversity-related activities by means of dedicated methodologies; encourages the Commission to allocate sufficient funds and resources so that the EU can fully deliver on its international commitments on the climate and environment, in line with the related targets and ambitions set out in the 2020 Interinstitutional Agreement.

ANNEX: DECLARATION OF INPUT

The rapporteur for opinion declares under his exclusive responsibility that he did not include in his opinion input from interest representatives falling within the scope of the Interinstitutional Agreement on a mandatory transparency register, or from representatives of public authorities of third countries, including their diplomatic missions and embassies, to be listed in this Annex pursuant to Article 8 of Annex I to the Rules of Procedure.