COMMISSION STAFF WORKING DOCUMENT Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Long-term forecast of future inflows and outflows of the EU budget (2025-2029)
Date: 2024-06-26
Institutions: Directorate-General for Budget, European Commission
Subjects: EU budget, EU expenditure, Member States' contribution, budget policy, budgetary resources, long-term forecast, multiannual financial framework, own resources

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 26.6.2024  SWD(2024) 163 final  COMMISSION STAFF WORKING DOCUMENT           Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Long-term forecast of future inflows and outflows of the EU budget (2025-2029) {COM(2024) 276 final}  
 
 
Table of Contents 

1. INTRODUCTION .......................................................................................................................................................................................................................... 3 

2. FORECAST ASSUMPTIONS BY MAIN SPENDING ELEMENTS ................................................................................................................. 3 

2.1. 2014-2020 European Structural and Investment (ESI) Funds and 2021-2027 cohesion policy funds .................. 3 

2.2. Rural Development ......................................................................................................................................................................................................... 4 

2.3. Direct payments and market measures under the Common Agricultural Policy..................................................................... 4 

2.4. Other programmes and funds ................................................................................................................................................................................. 4 

2.5. Administration .................................................................................................................................................................................................................... 5 

2.6. Special Instruments ........................................................................................................................................................................................................ 5 

3. ASSUMPTIONS FOR FORECASTING REVENUE .................................................................................................................................................. 6 

3.1. Applicable legislation ..................................................................................................................................................................................................... 6 

3.2. Traditional own resources .......................................................................................................................................................................................... 6 

3.3. National contributions ................................................................................................................................................................................................... 6 

3.4. Other revenue .................................................................................................................................................................................................................... 7 

2 

 
 
 
 
 
1.  Introduction 

This  document  accompanies  the  report  from  the  Commission  on  the  long-term  forecast  of  future  inflows  and 
outflows of the EU budget over 2025-2029 and provides additional technical information on the assumptions used 
for establishing the forecast results.  

2.  Forecast assumptions by main spending 

elements  

2.1.  2014-2020 European Structural and Investment (ESI) Funds and 

2021-2027 cohesion policy funds  

The completion of the legislative process for the Common Provisions Regulation and all linked sectoral  basic acts, 
and the priority given by Member States to the  implementation of the Recovery and Resilience Facility (RRF) – for 
which the timespan for commitments and payments is shorter than for cohesion policy –  delayed the adoption of 
2021-2027  operational  programmes.  In  2021,  the  first  year of  implementation,  not  a  single  national  programme 
was  adopted  and  100%  of  the  commitment  appropriations  allocated  for  cohesion  policy  were  reprogrammed  in 
equal proportions to the years 2022 to 2025 in accordance with Article 7 of the MFF Regulationi. 

The forecast for the 2021-2027 cohesion policy funds follows the profile of submission of interim payment claims 
as a share of the overall envelope observed in 2014-2020 programming period with certain adjustments. Firstly, the 
re-programming  under  Article  7  of  the  MFF  Regulation  would  lead  to  a  full  year  delay  compared  to  the  previous 
period implementation pace. Furthermore, the payments planned in the budget 2024 and the draft budget 2025 are 
considered  in  the  forecast,  confirming  the  delay  in  implementation  compared  to  the  programmes  2014-2020. 
According  to  the  central  scenario  considered  in  this  forecast,  Member  States  are  expected  to  speed  up 
implementation  in  2026  and  reach  the  historical  profile  in  2027,  followed  by  full  cruising  speed  afterwards.  This 
includes the effect of STEP, including EUR 5.9 billion from NextGenerationEU under the Just Transition Fund. 

It  is  assumed  that  Member  States  will  use  all  the  available  administrative  possibilities  to  avoid  decommitments 
given the more elevated risks than in the past. Therefore, it is assumed that from 2025 Member States will submit 
payment  claims  by  the  end  of  the  year  that  would  reduce  the  amount  of  decommitments  to  one  fifth  of  the 
projected results following each of the scenarios. The remaining amounts representing four fifths of the projected 
decommitments  would  give  rise  to  recoveries  as  internal  assigned  revenue  in  the  following  year  and  used  as 
payment appropriations equally in this same year and the following one. Excluding this administrative possibility of 
over-submitting payment claims would multiply the decommitments by five.  

The forecast for payments in relation to the 2014-2020 programming period is based on the information provided 
by  Member  States  in  January  2024  forecasts.  The  payments  in  2025  reflect  the  draft  budget  proposal.  For  the 
subsequent  years,  a  key  determining  factor  for  implementation  are  the  proposed  measures  accelerating 
implementation  and  facilitating  full  absorption,  under  the  CARE,  FAST-CARE  and  SAFE  initiatives  as  well  as  the 
earlier  Coronavirus Response  Investment  Initiatives (CRII  and CRII+).  The  end  of  the  last  accounting  year  is on  30 
June 2024 and the final application for an interim payment should be submitted by 31 July 2025 following STEP. 
Closure payments are expected to be limited afterwards. 

 
 
2.2.  Rural Development 

The  submission  of  payment  claims  of  the  European  Agricultural  Fund  for  Rural  Development  under  the  new  CAP 
started in 2023, the first year of implementation, one year earlier than the historical implementation profile of the 
2014-2022 period. The EAFRD pre-financing under the new CAP applied to 2023-2027 envelopes started in 2023. 
The  payment  pattern  for  the  period  2025-2029  is  based  on  the  historical  data  adapted  to  a  shorter  period 
compared to the previous programmes and to the N+2 automatic de-commitment rule.  

As regards the forecast for the completion of the 2014-2022 programmes, in 2025 the level of payments is smaller 
than  in  last  year’s  forecast.  Closure  and a  small  share  of  interim  payments  are  expected  in  2026,  respecting  the 
applicable N+3 de-commitment rule. 

Even if all EAFRD commitments over 2014-2022 correspond to the previous programming period, this forecast splits 
the payments related to commitments prior to and after 2020 to differentiate payments according to the relevant 
MFF periods and ceilings. To that end, the forecast assumes that as of 2024 all payments would be counted against 
budgetary commitments made in 2021-2022. 

2.3.   Direct payments and market measures under the Common 

Agricultural Policy 

Most  of  the  appropriations  for  the  European  Agricultural  Guarantee  Fund  (EAGF)  are  non-differentiated,  i.e.,  both 
commitments and payments match in the same annual budget. The bulk of appropriations are direct payments to 
farmers, which are usually reimbursed to Member States during the first months of the following budget year. The 
commitments  on  which  the  payment  forecast  is  based  aligns  with  the  financial  programming  accompanying  the 
draft  budget  for  2025.  Member  States  communicatedii  the  transfers  between  pillars  of  the  Common  Agricultural 
policy, which resulted in a net transfer of EUR 3.7 billion from pillar I (EAGF) to pillar II (EAFRD) in the period 2025-
2027, which was considered for the payment estimations. 

2.4.  Other programmes and funds 

For all other spending items (e.g., research and innovation, large scale infrastructure projects, internal and external 
policies), the forecasts for payments on the commitments authorised in the current financial framework are based 
on the draft budget for 2025 and the accompanying payment schedules of the individual budget lines, as provided 
in Working Document XIII accompanying the Draft Budget. The expected average pattern of implementation for the 
next two commitment tranches (2023 and 2024) is extrapolated to the commitments for the years 2025 to 2029. 

These  commitments  are  expected  to  follow  the  financial  programming  accompanying  the  draft  budget  for  2025 
including, where relevant, the additional top-ups stemming from the programme specific adjustment mechanism of 
Article  5  of  the  MFF  Regulation.  For  Horizon  Europe,  the  European  Parliament  and  the  Council  agreed  to  make 
available again over the MFF period an amount of EUR 500 millioniii in 2018 prices in appropriations resulting from 
total  or  partial  non-implementation  of  research  programmes,  in  accordance  with  Article  15(3)  of  the  Financial 
Regulation.  In  the  context  of  the  mid-term  revision,  this  amount  has  been  increased  by  EUR 100 millioniv  in  2018 
prices. 

As  for  Heading  6  -  Neighbourhood  and  the  World,  the  war  in  Ukraine  is  associated  with  a  greater  level  of 
uncertainty.  The  mid-term  revision  of  the  MFF  has  provided  substantial,  additional  firepower  to  address  external 
action,  both  within  heading  6  and  in  the  form  of  the  Ukraine  Facility,  financed  for  its  non-repayable  support 
component by a new special instrument – the Ukraine Reserve. In 2021-23, there has been positive progress on the 
programming  of  the  external  action  instruments  and  the  kick-off  of  implementation.  Yet,  it  is  still  premature  to 

 
 
assess  fully  the  long-term  budgetary  effects  of  the  novel  architecture  of  the  instruments  (mostly  the 
Neighbourhood, Development and International Cooperation Instrument  - Global Europe) in respect of the potential 
re-use of de-commitments, carry-over provisions and of the mobilisation of the emerging challenges and priorities 
cushion post-2024, notably given the substantial changes brought on by the mid-term revision. At this stage, no de-
commitments  for  the  programmes  having  the  possibility  to  re-use  them  are  forecast  since  the  effect  over  time 
would be neutral.  

The  forecast  for  payments  completing  activities before  2021  is  based  on  the  experience  from  past  programming 
periods and the latest project information. 

2.5.  Administration 

Administrative  expenditure  (Heading  7)  is  implemented  as  non-differentiated  appropriations,  i.e.,  commitments 
match  payments  in  the  same  annual  budget.  The  forecast  translates  the  financial  programming  of  commitment 
appropriations into payments. 

Most of the EU-funded decentralised agencies (all of which are outside Heading 7) follows the same approach. 

All administrative expenditure, and in particular under Heading 7, is and will be under pressure in 2024-2025 and 
going forward due to persistently high levels of inflation, even with strict reprioritisation. 

2.6.  Special Instruments 

Special instruments fall under two categories: 

- 

Thematic  instruments  –  providing  support  in  unforeseen  events  such  as  natural  disasters,  mass 
redundancies, humanitarian, and other crises. Due to their nature, forecasting over a longer time horizon is 
not possible, with the exception of the Brexit Adjustment Reserve for which expenditure is programmed over 
2021-2023 and in 2025, in line with the relevant basic actv, and taking into account the mid-term revision 
of the MFF. The present report thus includes the expenditure planned in the draft budget for 2025. 

-  Non-thematic instruments – allocating additional amounts for specific MFF programmes subject to specific 
conditions.  Their  mobilisation  and  the  subsequent  payment  needs  cannot  be  forecast.  For  the  Flexibility 
Instrument,  the  payments  stemming  from  past  mobilisations  are  included  in  the  overall  payment  as 
provided in the Communication on the technical adjustment of the MFF for 2025. 

The expenditure covered by the mobilisation of special instruments is counted in addition to the MFF ceilings and is 
excluded for the purpose of establishing the margins for commitments and payments. 

The  Ukraine  Reserve  may  be  mobilised  for  the  sole  purpose  of  financing  expenditure  under  the  Ukraine  Facility. 
Since the Ukraine Facility is subject to  decisions by the European Parliament and Council in the framework of the 
annual budgetary procedure, no forecast is provided beyond the amounts proposed in the draft budget for 2025. 

The EURI Instrument may be mobilised by the European Parliament and the Council in the framework of the annual 
budgetary  procedure  subject  to  the  conditions  laid  out  in  the  MFF  Regulation.  Given  the  substantial  uncertainty 
related to the actual annual disbursement profiles, as well as to decisions to mobilise the instrument on an annual 
basis, no forecast is provided. 

 
 
 
 
3.  Assumptions for forecasting revenue 

3.1.  Applicable legislation 

The  revenue  forecast  presented  in  this  report  is  based  on  the  parameters  of  the  Own  Resources  Decision  2020vi, 
effective since 1 January 2021, for all years of the reporting period (2025-2029). The revenue projections are based 
on the Commission spring 2024 economic forecast and long-term growth projections.1 

3.2.  Traditional own resources 

Customs  duties  are  projected  to  grow  over  the  period  2026-2029  at  the  same  rate  as  nominal  Gross  National 
Income (GNI) of each Member State starting from the level of gross customs duties projected  for the Draft Budget 
2025. 25% of the customs duties will be retained by Member States as collection costs. 

3.3.  National contributions 

National contributions have for a long time included the  GNI-based own resource and the Value Added Tax (VAT)-
based  own  resource.  The  Own  Resources  Decision  2020  introduced  a  new  own  resource  based  on  non-recycled 
plastic packaging waste. The parameters for the own resources specified in the Own Resources Decision determine 
the Member States’ share in the total amount of national contributions that is needed to balance the EU budget. 

Revenue from the VAT-based own resource is projected starting from the VAT bases of the individual Member States 
included in the Draft Budget 2025. The VAT bases are projected to grow over the period 2026-2029 at the same 
rate as GNI in current prices, capped at 50% of GNI. A uniform call rate of 0.30% applies. 

The plastics own resource is projected starting from non-recycled plastic packing waste included in the Draft Budget 
2025. The corresponding  plastic packaging  waste is projected to grow at the  same  rate as GNI in  constant  prices 
over 2026-2029. Recycling rates are projected to converge linearly towards the EU recycling target of 55%, which 
must  be  achieved  by  2030.  The  increase  of  recycling  rates  is  capped  at  1  percentage  points  per  year,  and  the 
recycling rate of Member States having already reached or surpassed the target is kept constant over the forecast 
period. A uniform call rate of EUR 0.80 per kilogram applies to the weight of non-recycled plastic packaging waste, 
i.e.  the difference between the forecast plastic packaging waste and the recycled part. For some Member States, the 
resulting contribution is reduced by a fixed annual lump sum. 

The  GNI-based  own  resource  for  the  EU-27  is  calculated  as  the  remaining  difference  between  all  other  own 
resources and other revenue on the one hand and the forecast expenditure on the other. 

1 European Commission (2024), European Economic Forecast, Spring 2024, European Economy, Institutional Paper, 
286. 

 
 
 
3.4.   Other revenue 

Other revenue of the EU budget traditionally includes staff contributions, revenue accruing from the administrative 
operation  of  the  institutions,  contributions  and  refunds  in  connection  with  Union  agreements  and  programmes, 
interest on late payments and fines, revenue from borrowing and lending operations, and miscellaneous revenue  – 
as well as surpluses from previous years. Given their inherent volatility, most of  these components are difficult to 
forecast.  Therefore,  the  amount  included  in  the  Draft  Budget  2025  (i.e.,  EUR 3 billion)  is  assumed  to  remain 
nominally constant over the forecast period. 

Since  2021,  in  addition  to  the  above-mentioned  items,  other  revenue  of  the  EU  budget  includes  the  United 
Kingdom’s contribution related to outstanding commitments (RAL) for which the United Kingdom is liable, pension 
obligations and other components of the financial settlement, as laid down in the Withdrawal Agreement vii. This is 
also reflected in the proposed financing of the Draft Budget 2025. 

The contribution of the United Kingdom related to outstanding commitments on 31 December 2020 is determined 
by applying the  United Kingdom’s financing share to the  forecast RAL payments for each year of the  2025-2029 
period.  The  resulting  annual  contribution  takes  into  account  the  payment  modalities  set  out  in  Article  148  of  the 
Withdrawal Agreement. 

The forecast of other revenue includes the United Kingdom’s contribution to pension liabilities for Members and EU 
high-level  public  office  holders  as  specified  in  Article  142(5)  of  the  Withdrawal  Agreement.  The  United  Kingdom 
contribution  to  staff  pensions  (an  estimated  EUR 303 million  in  the  Draft  Budget  2025)  enters  the  EU  budget  as 
external assigned revenue and is therefore not part of the long-term forecast of other revenue. 

 
 
i Council Regulation (EU, Euratom) 2020/2093 laying down the multiannual financial framework for the years 2021 
to 2027, OJ L 433I, 22.12.2020, p. 11. Amended by Council Regulation (EU, Euratom) 2024/765 of 29 February 
2024 amending Regulation (EU, Euratom) 2020/2093 laying down the multiannual financial framework for the 
years 2021 to 2027, OJ L, 2024/765, 29.02.2024. 

ii Member States decided to transfer funds between direct payments and rural development. The result was set out 
in Commission Delegated Regulation 2023/813 of 8 February 2023 

iii Joint declaration by the European Parliament, the Council and the Commission on the re-use of decommitted funds 
in relation to the research programme 2020/C 444 I/03, OJ C 444I, 22.12.2020, p. 3. 

iv Council Regulation (EU, Euratom) 2024/765 of 29 February 2024 amending Regulation (EU, Euratom) 2020/2093 
laying down the multiannual financial framework for the years 2021 to 2027, OJ L, 2024/765, 29.02.2024. 

v Regulation (EU) 2021/1755 of the European Parliament and of the Council of 6 October 2021 establishing the 
Brexit Adjustment Reserve, OJ L 357, 8.10.2021, p. 1–26. 

vi Council Decision (EU, Euratom) 2020/2053 of 14 December 2020 on the system of own resources of the European 
Union, OJ L 424/1, 15.12.2020. 

vii All components of the United Kingdom contribution are laid down in Article 148 of the Withdrawal Agreement. The 
forecast  only  includes  components  which  are  quantifiable  at  this  stage,  namely  the  provisional  United  Kingdom 
contribution  to  the  financing  of  payments  resulting  from  outstanding  commitments  prior  to  2021  for  which  the 
United  Kingdom  is  liable  under Article  140  and  pension  liabilities specified  under  Article  142.5  of  the  Withdrawal 
Agreement  as  well  as the  amounts the  Union  owes to  the  United  Kingdom under Article  145  (European  Coal  and 
Steel Community) and Article 146 (Union investment in the EIF). 

8