Two Europes, One Budget

Will the Next MFF Be Blessing or Curse for Regional Cohesion?

As negotiations over the 2028–2034 Multiannual Financial Framework (MFF) gather momentum, the future of European cohesion policy is once again in the spotlight. When Hungary held the Council Presidency of the European Union in the second half of 2024, it placed regional development and competitiveness at the center of European discussions. As Hungary now leads the Visegrád Group (V4), these issues remain high on the agenda. In this context, Cohesion Summit 2025 took place on October 21, 2025, at Várkert Bazár in Budapest. Organized by Hungary’s Ministry of Public Administration and Regional Development together with Ludovika University of Public Services – Europe Strategy Research Institute, the summit brought together ministers from Hungary, Romania, and Slovenia, the President of the European Committee of the Regions, European Commission representatives, and policy experts to address a central question: What will the next Multiannual Financial Framework look like?

Two Funding Worlds, One Europe

The European Commission’s proposal for the 2028–2034 Multiannual Financial Framework allocates approximately €865 billion to National and Regional Partnership Plans covering cohesion, agriculture, and social policies (COM(2025) 570), while the European Competitiveness Fund receives roughly €410 billion for strategic technologies and innovation (€175 billion for Horizon Europe (COM(2025) 543) and €234 billion for the European Competitiveness Fund (COM(2025) 555)). These two funding streams operate under different rules and procedures, yet both fundamentally shape regional development trajectories across Europe.

However, the geographic distribution of these funds reveals a persistent imbalance: less developed regions receive only 7% of Horizon Europe funding, while the top 20 regions capture over 50% (Commisioner Bernadette Petri, Cohesion Summit 2025).This creates a “funding cliff”, a structural barrier preventing entire regions from accessing competitive innovation resources.

The Cohesion Paradox

Hungarian Minister Tibor Navracsics identified the core tension at the Cohesion Summit: “Competitiveness and cohesion are linked. Cohesion needs competitiveness as an engine for growth, while competitiveness without cohesion cannot exploit the full growth potential.” When cohesion policy invests billions in infrastructure and capacity building in less developed regions, while innovation programs simultaneously concentrate resources in established hubs, the EU effectively builds capacity with one instrument while limiting access to opportunity with another.

The widening countries,15 member states including Bulgaria, Croatia, Cyprus, Czechia, Estonia, Greece, Hungary, Latvia, Lithuania, Malta, Poland, Portugal, Romania, Slovakia, and Slovenia, illustrate this challenge. These countries represent 30% of the EU’s population yet received only 8.7% of overall Horizon Europe funding in recent years. Many demonstrate strong capacity in absorbing cohesion funds, suggesting the barrier lies not in implementation capability but in program design and accessibility.

Romanian Minister Dragoș Pîslaru framed the choice during the summit: the new Multiannual Financial Framework “can be a blessing or a curse and it’s up to us.” His observation reflects Central and Eastern European experience with successful cohesion implementation alongside persistent difficulties accessing competitive innovation funding. The question is whether the next MFF will address this structural disconnect or reinforce it.

Practical Solutions

President Kata Tüttő of the European Committee of the Regions reframed the discussion: “Cohesion policy is not charity but an investment tool in the common market.” Applying this investment logic consistently to both cohesion funds and directly managed programs would require fundamental changes in funding architecture.

Bernadett Petri, Ministerial Commissioner at the Ministry of Public Administration, Administration and Regional Development and Director of the Europe Strategy Research Institute, presented four concrete proposals to address regional disparities in EU fund distribution: first, creating transparency dashboards showing regional distribution of directly managed program funds at the NUTS level (the EU’s standard regional classification system), emphasizing that “what gets measured can be managed”; second, establishing regional innovation corridors linking innovation hubs in developed regions with two or three less developed regions, with extra evaluation points for consortia operating within these corridors; third, a demographic incentive module providing evaluation bonuses for projects in less developed regions affected by population decline; and fourth, capacity building through a new EU instrument supporting application writing, partnership building, and project management in less developed regions (Cohesion Summit Budapest, 2025). Her central argument was that competitiveness and cohesion principles should complement rather than compete with each other.

The Central European Voice in MFF Negotiations

The V4’s collective voice, Hungary, Poland, Czechia, and Slovakia, remain active in Council debates on balancing territorial cohesion with competitiveness goals. While their collective stance may not directly shape negotiations, it reinforces calls for a more integrated funding approach. The coming months will determine whether Central European priorities for funding coherence can meaningfully influence the final MFF framework, or whether traditional separation between cohesion and competitiveness programs will persist into the next cycle.

Photo source: European Parliament / wikimedia.org