MEP Peter Agius urges fairness in EU budget funding debate

The European Parliament has called for a larger and more flexible long-term EU budget, shifting the focus to the politically sensitive question of how it will be financed.

MEPs want the next Multiannual Financial Framework (MFF) set at 1.27% of EU gross national income, while repayments tied to the post-pandemic recovery fund would sit outside the main budget limits. Should Member States agree to this, total EU expenditure could rise above €2 trillion over the period.

With spending priorities now broadly agreed, attention is turning to how the European Union will raise the funds needed to support increased investment in areas such as competitiveness, defence and security.

Against this backdrop, MEP Peter Agius has cautioned that he will oppose any measures that unfairly burden smaller member states as discussions on new revenue sources intensify.

Agius said he supports the need for a stronger EU budget but stressed that the method of financing it will be critical.

“I will vote against any measure which puts an unfair burden on Malta,” he said.

He pointed to discussions around potential new EU revenue streams, including taxes that could disproportionately affect certain sectors. In particular, he flagged concerns over a possible levy on gaming transactions, noting that while the sector  represents a modest share  of GDP in many countries,  it accounts for a significantly larger portion of Malta’s economy.

Applying uniform measures without considering such differences, he argued, risks undermining fairness between member states.

Agius also drew comparisons with the extension of the EU Emissions Trading System to shipping, which Malta has previously criticised for placing a heavier burden on island and peripheral states. Such examples, he said, show how EU-wide policies can produce uneven outcomes if geographic and economic realities are overlooked.

Beyond funding concerns, Agius welcomed elements of Parliament’s position, particularly continued support for strategic investment and key sectors. However, he reiterated the need for EU funds to remain closely aligned with citizens’ needs, warning that resources intended for sectors such as agriculture and fisheries should not be diluted or redirected.

He also highlighted transport, healthcare and youth initiatives among his priorities as negotiations progress.

With Parliament having set out its spending ambitions, the focus now shifts to member states to churn out the details. While some governments, including Germany are wary of increasing the EU’s budgetary allocation, the debate over new own resources, whether through EU-level taxes, national contributions or other mechanisms is expected to be one of the most politically sensitive aspects of the upcoming negotiations.