Exclusive: Sasan Ghandehari’s partnership with religious foundation raises questions about past dealings with republic criticised by Nigel Farage

Nigel Farage’s newest billionaire donor was in business with a powerful Iranian religious foundation under the authority of the country’s supreme leader, raising questions about his past dealings with the hardline republic.

Hossein Ghandehari, also called Sasan, was little known in the UK until he pledged to give millions to Reform UK this summer and donated £50,000 to Farage to cover the cost of two passes for the Davos World Economic Forum.

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© Photograph: Jeff Gilbert/Alamy

© Photograph: Jeff Gilbert/Alamy

© Photograph: Jeff Gilbert/Alamy

Each place, selected from longlist of nine, will be given £125,000 to develop bids before winner is announced in new year

Blackpool, Sheffield, Milton Keynes and Wrexham have been shortlisted to be the UK city of culture 2029, an award viewed as a way to boost local economies, foster civic pride and, above all, have some fun.

The four places were chosen from a longlist of nine and each will be given £125,000 to develop their bids before the winner is announced in the new year.

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© Photograph: Jon D/Alamy

© Photograph: Jon D/Alamy

© Photograph: Jon D/Alamy

MEPs have approved emergency EU funding to help four southern European countries recover from destructive storms and flooding earlier this year, with Portugal receiving the largest allocation.

The European Parliament approved €489.15 million in financial assistance for Portugal, Spain, Italy and Malta on Wednesday, 21 October, following severe storms and flooding that damaged infrastructure and disrupted communities across southern Europe during the opening months of 2026.

The allocation from the European Union Solidarity Fund was approved by 651 votes to 17, with three abstentions. Portugal will receive the largest share, approximately €261.5 million, followed by Spain with €149.1 million, Italy with €74.9 million and Malta with €3.7 million.

The funding is intended to support recovery operations and help national authorities meet the costs of restoring essential public infrastructure and services damaged by the disasters.

Portugal receives largest allocation

Portugal’s €261.5 million allocation follows flooding and storms that affected the country during January and February.

The Portuguese authorities applied for assistance from the EU Solidarity Fund after assessing the extent of the damage and the associated costs of emergency operations and infrastructure recovery.

The funds will contribute to eligible public expenditure arising from the disasters, potentially including the restoration of transport links, damaged public facilities and other essential infrastructure.

Portugal has already received approximately €65.37 million in advance funding, according to the figures accompanying the parliamentary decision.

Spain will receive €149.1 million following destructive weather during the same period, including severe flooding in February.

The Spanish government had also requested European assistance to cover part of the expenditure associated with recovery operations.

Approximately €37.26 million of Spain’s allocation has already been paid in advance.

The two countries together account for the substantial majority of the assistance approved on Wednesday, reflecting the scale of their eligible recovery costs.

Storm Harry damages Italy and Malta

Italy and Malta will receive assistance following Storm Harry, which struck parts of the central Mediterranean in January 2026.

Italy’s allocation amounts to €74.9 million, while Malta will receive €3.7 million.

The storm caused significant disruption in affected Mediterranean areas, with heavy rainfall, strong winds and damaging sea conditions placing pressure on local infrastructure.

Italian authorities sought European support for recovery operations in the affected territories, while Malta submitted its own request following the damage sustained during the storm.

The Maltese allocation includes approximately €931,000 already made available through an advance payment.

The final assistance amounts were proposed by the European Commission after examining the applications submitted by the four governments.

The Commission’s September proposal to mobilise the EU Solidarity Fund set out the amount of assistance required for each country.

The total proposed mobilisation was €489,148,220.

How the EU Solidarity Fund works

The European Union established the Solidarity Fund in 2002 to assist member states and certain countries participating in the EU accession process following major natural disasters.

The mechanism provides financial support for public emergency and recovery expenditure rather than operating as a general insurance scheme for individuals or businesses.

Eligible expenditure can include emergency accommodation, restoring essential infrastructure, securing protective infrastructure, cleaning disaster-affected areas and protecting cultural heritage.

National authorities submit applications to the Commission, which evaluates them against the relevant eligibility requirements and financial thresholds.

Assistance depends on the assessed disaster damage and applicable regulatory criteria, rather than simply reimbursing every euro of economic loss.

The fund is financed through EU budgetary arrangements and is mobilised following the required institutional approvals.

Payments are made to the countries concerned, which remain responsible for ensuring that assistance is used in accordance with EU financial rules.

The Solidarity Fund can therefore help governments manage exceptional recovery costs, but it does not replace national budgets, private insurance or other financial arrangements.

Rising pressure on European disaster funding

The latest allocation comes against a background of increasingly frequent demands on European disaster-response mechanisms.

Southern European countries have experienced damaging floods, storms, heatwaves and wildfires in recent years, leading to repeated requests for assistance.

Recovery expenditure extends beyond immediate emergency operations. Damaged roads, bridges, coastal defences, water systems and public buildings can require prolonged reconstruction.

These costs can place considerable pressure on local authorities, particularly where a disaster affects tourism, transport or economic activity.

The EU faces the additional challenge of maintaining sufficient funds to respond to major disasters affecting several countries within a relatively short period.

Extreme weather events can also expose weaknesses in existing infrastructure, prompting governments to consider whether reconstruction should incorporate additional protection against future disasters.

However, such investments must be assessed against the eligible spending categories of the Solidarity Fund and the availability of other EU financing programmes.

Parliamentary approval and implementation

Wednesday’s vote represents parliamentary approval of the mobilisation proposed by the European Commission.

The decision concerns disasters that occurred earlier in 2026 and does not constitute a new emergency response operation.

The funds will support eligible recovery measures carried out by the national authorities in the four countries.

The payments already made to Portugal, Spain and Malta will be taken into account when the remaining assistance is disbursed.

EU authorities will retain responsibility for monitoring compliance with the relevant financial and reporting requirements.

The substantial parliamentary majority indicates broad support for assistance to the affected countries, although future disaster-funding arrangements will continue to depend on the resources available in the European budget.

For the four governments, the immediate task is to use the approved assistance to meet eligible recovery costs and restore damaged public infrastructure following the storms earlier this year.

European prosecutors have searched offices in Brussels and Strasbourg as an investigation into alleged misuse of parliamentary funds by the former Identity and Democracy group raises questions over financial liabilities inherited by Patriots for Europe.

European prosecutors carried out searches at the European Parliament’s offices in Brussels and Strasbourg on Wednesday, 21 October, as part of an investigation into alleged financial irregularities involving the former Identity and Democracy (ID) parliamentary group.

The investigation concerns approximately €4.33 million in European Union funds that were allegedly improperly spent during the 2019–2024 parliamentary term. The European Public Prosecutor’s Office (EPPO) confirmed that searches had taken place in connection with an ongoing inquiry into the use of EU funds by a former parliamentary group.

The premises searched are now occupied by Patriots for Europe, the European Parliament’s third-largest political group, which includes France’s National Rally, Hungary’s Fidesz, Italy’s Lega and Spain’s Vox. Patriots for Europe insists that it has no legal continuity with Identity and Democracy and denies being involved in the investigation.

Investigation into parliamentary expenditure

The European Public Prosecutor’s Office opened its investigation in July 2025 following concerns identified by the European Parliament’s financial administration about expenditure incurred by Identity and Democracy.

The former group, which dissolved following the 2024 European elections, included representatives of France’s National Rally, Italy’s Lega and Germany’s Alternative for Germany.

According to details of the parliamentary financial examination subsequently reported in France, investigators are examining approximately €3.6 million in contracts awarded to external service providers, including businesses with political connections to parties represented within the former group.

The financial examination also identified more than €700,000 in donations to organisations whose activities were allegedly unrelated to the parliamentary group’s official functions.

The authorities are examining whether parliamentary resources were used in accordance with EU financial rules, including restrictions on using public money for national party-political activities.

These are allegations under investigation, not criminal findings. The EPPO has not announced convictions arising from the current inquiry, and the individuals and organisations concerned retain the presumption of innocence.

Earlier investigative measures were conducted in France, Belgium, Spain and Italy in June 2026. Wednesday’s searches mark a further stage in the proceedings.

Can Patriots for Europe inherit the liabilities?

The investigation has opened a separate dispute over whether Patriots for Europe could be required to repay money allegedly misspent by its predecessor.

Identity and Democracy ceased to exist after the 2024 elections. Several parties previously represented in the group subsequently joined Patriots for Europe, a new parliamentary formation that also brought together Viktor Orbán’s Fidesz and Spain’s Vox.

Patriots for Europe maintains that the two groups are legally separate. Its representatives argue that the dissolution of Identity and Democracy ended that group’s institutional existence and that the present parliamentary organisation is not responsible for its predecessor’s financial affairs.

However, the European Parliament’s budgetary authorities have examined whether responsibility for outstanding liabilities can pass to a successor group.

An opinion approved by the Parliament’s Budgetary Control Committee in September considered the circumstances in which continuity between parliamentary groups might establish financial responsibility.

Such an assessment may consider whether members, administrative personnel, operational resources and other assets were transferred from one organisation to another.

The outcome could determine whether the current group is exposed to potential repayment demands, irrespective of whether its present members were personally involved in the expenditure under investigation.

No final determination of such liability has been established through Wednesday’s searches.

Political consequences in Strasbourg

The searches come at a time when Patriots for Europe has become a major political force within the European Parliament.

Its member parties have challenged EU policy on immigration, economic regulation and the distribution of powers between Brussels and national governments. National Rally and Fidesz are also influential actors in the domestic politics of France and Hungary respectively.

An investigation involving their parliamentary organisation is therefore likely to attract scrutiny beyond the immediate financial questions.

Nevertheless, the political influence of the group and the criminal investigation must be considered separately. The presence of prosecutors at parliamentary premises does not establish wrongdoing by the current group’s MEPs.

The case also raises broader questions about financial accountability within the Parliament, particularly when a political group dissolves following an election and its members establish a new organisation.

Unlike national political parties, European parliamentary groups receive funding specifically to support their legislative, administrative and political work inside the institution.

Those resources are subject to financial controls intended to prevent their diversion into activities that should be funded by national parties or other organisations.

Further proceedings

The EPPO is responsible for investigating and prosecuting offences affecting the European Union’s financial interests. It operates independently of national governments and EU political institutions.

The European Parliament has confirmed its cooperation with the authorities but has declined to comment on the substance of the continuing investigation.

Prosecutors must now assess the evidence obtained during the searches alongside financial records and material collected during previous investigative measures.

Any decision to bring criminal proceedings would depend on the evidence available and the relevant national and European legal requirements.

Separately, the Parliament will have to establish whether any recoverable funds are owed by the former group and, if so, which organisation is legally responsible for repayment.

For Patriots for Europe, the immediate issue is not only the progress of the criminal inquiry but whether the financial arrangements of a dissolved parliamentary group can create obligations for its successor.

Party given additional penalty by Electoral Commission for not paying original fine on time

Reform UK has been fined more than £2,000 for failing to declare it was the publisher of campaign material seen by voters – including an additional penalty for failing to pay on time.

Nigel Farage’s party was sanctioned by the Electoral Commission after four items of elections material were missing an “imprint” – a declaration of the publisher so voters know who has paid for the promotional message.

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© Photograph: Tolga Akmen/EPA

© Photograph: Tolga Akmen/EPA

© Photograph: Tolga Akmen/EPA

The energy ministry on Wednesday said it is no longer accepting applications for people to receive grants as part of the “save and upgrade homes” scheme, as all the available funds have now been allocated, just a day and a half after applications opened.

It said that interest in the scheme was “particularly high”, and that this had meant that after applications opened on Tuesday, the planned €20 million budget had already been reached, and that as such, an extra €7.5 million was then allocated to the scheme from funds which had been allocated but not used for previous government schemes.

Now, however, with that amount also having been reached, the ministry says it is no longer accepting applications.

It had initially been foreseen that applications would remain open until December 30, with the scheme having been devised to allow homeowners to undertake a range of projects on their homes to improve their energy efficiency.

These include the installation of thermal insulation, the replacement of windows and doors, the installation of solar water heaters, the installation of high-efficiency air conditioning units, and the installation of solar panels.

Beneficiaries were entitled to a maximum of €32,000 per household.

• Fireworks AI is an AI-infrastructure startup founded by former Google and Meta AI engineers.
• The company is seeking to raise a new round of funding at a valuation between $30 billion and $40 billion.
• Fireworks AI was last valued at nearly $18 billion in July of this year.

Fireworks AI is seeking to raise fresh funding at a valuation between $30 billion and $40 billion, a dramatic jump just months after the AI-infrastructure startup was valued at $17.5 billion, according to people familiar with the matter.

The potential valuation leap reflects investors' appetite for the companies selling the computing power and tools fueling the AI boom, even as Fireworks AI works through the fallout from a recent security incident.

The talks around the financing are still early, and valuation targets could still change. Fireworks declined to comment.

Founded in 2022, Fireworks was built by veterans of Meta and Google's AI efforts. Chief executive Lin Qiao previously led the PyTorch team at Meta, while cofounders include former Meta infrastructure engineers and a former leader of Google's Vertex AI. The company rents out computing infrastructure and software that lets businesses run, fine-tune, and deploy open-weight and custom AI models.

In July, Fireworks announced a $1.5 billion Series D funding round at a $17.5 billion valuation, led by Atreides Management, Index Ventures, and TCV, with participation from Nvidia, Lightspeed Venture Partners, Bessemer Venture Partners, and Menlo Ventures. That round followed a $250 million Series C at a $4 billion valuation in late 2025, co-led by Lightspeed, Index, and Evantic. Last month, The Information reported that Fireworks has been considering a round at a $30 billion.

Rather than trying to build a consumer chatbot to rival ChatGPT, Fireworks sells what it calls specialized intelligence: models customized on a customer's proprietary data, workflows, and use cases. The company said in July that it had surpassed $1 billion in annualized revenue and was serving more than 40 trillion tokens a day; it said 95% of those tokens came from models tailored to customers.

The company operates in a highly competitive layer of the AI stack. Rivals include model-infrastructure startups such as Together AI, Baseten, and Replicate, as well as cloud giants such as Amazon Web Services, Google Cloud, Microsoft Azure, and Oracle.

The fundraising talks come shortly after a security incident at Fireworks AI. The company said it identified unauthorized use of internal credentials earlier this month that allowed an intruder to access data from some customer accounts.

"We take this seriously and will be transparent about what happened and what we find," Qiao posted on X. "I'm personally committed to turn this attack into the most formidable security response in AI Infra."

Please send along your tips. Email Ben or Katie anytime or contact them on Signal at benbergman.11 and kroof.26. Sign up for Business Insider's weekly VC Insider newsletter here.

Exclusive: Admission from James Orr to undercover reporter came three months before party was given £72m

A senior Reform UK official raised questions about whether major donations from billionaire backers Christopher Harborne and Ben Delo would be legal under the proposed new foreign donors cap three months before they gave £72m to the party.

James Orr, who was then Reform UK’s head of policy and a Cambridge professor, discussed potential difficulties around future donations from Harborne and Delo in undercover footage captured by the investigative reporting group Verbatim.

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© Photograph: Leon Neal/Getty Images

© Photograph: Leon Neal/Getty Images

© Photograph: Leon Neal/Getty Images

School looking to sell piece of open land beloved by people in Devon town to fund refurbishments

On Saturdays throughout autumn, residents of Totnes have met at a field on the banks of the River Dart to play ballgames, fly kites or simply sit on the grass and chat.

But it hasn’t just been about having fun – this has been a “play protest” aimed at trying to save a beloved piece of open land in the historic Devon market town.

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© Photograph: Jim Wileman/The Guardian

© Photograph: Jim Wileman/The Guardian

© Photograph: Jim Wileman/The Guardian

Thousands rally for better-funded public schools as a teachers’ strike in Madrid leaves two people injured and five students arrested.

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Five students were arrested and two people injured during police confrontations in Madrid on Wednesday, as thousands of teachers and supporters took to the streets on the first day of a regional teachers’ strike demanding better funding, smaller classes and improved working conditions in public education.

RELATED: Marches in Spain Honor Maricarmen, the Evicted Woman Who Died Amid the Housing Crisis

Demonstrators wearing green gathered at Puerta del Sol before marching through central Madrid towards the regional Education Department. The protests targeted the education policies of regional president Isabel Díaz Ayuso, whom demonstrators accuse of weakening public schools by diverting taxpayer funds to private education and refusing to negotiate with teachers and parent associations, according to teleSUR correspondent Álvaro Fragua.

Police also confronted students at Madrid’s Complutense University during a demonstration in support of the strike. Two people were taken to hospital with injuries. Five university students and a woman participating in a separate demonstration in central Madrid were arrested. No further arrests had been reported at the time of the report.

Text Reads: 📚 Non-university teachers in the Community of Madrid, Spain, began an indefinite strike this Wednesday—called by trade unions—to demand better working conditions and more resources for quality public education. No end date has been set for the stoppage.
🧑‍🏫 Their demands include better conditions for teaching staff, increased resources for public education, smaller class sizes, and proper care for all students.
📢 Demonstrations have been organized for the initial days of the strike: a march from Atocha to Puerta del Sol this afternoon and a human chain on Thursday at the Department of Education.

Teachers said educational inequality was reflected in disparities between neighborhoods, arguing that children’s access to quality education depended on where they lived, with poorer communities bearing the greatest burden.

The strikers are demanding changes to class sizes, teaching workloads and specialist support for students with additional educational needs. Their proposals include capping classes at 13 students in early childhood education, 15 in primary school, 20 in secondary school, 23 in upper secondary education and 15 in vocational training.

They also want weekly teaching loads limited to 17 periods for secondary school and vocational training teachers and 22 for primary school teachers. The proposed limits would include tutoring, department leadership and coordination duties.

Improving support for students with disabilities and other educational needs is another central demand. Teachers are calling for at least one guidance counselor for every 250 students, one community services professional at each school, one therapeutic education teacher for every eight students and one speech and language specialist for every 12. They also want a compensatory education teacher at every school and additional staffing guarantees for special education.

On pay, the strikers are seeking a €600 monthly increase in the regional general teaching supplement, along with pay parity for vocational training teachers and specialists in community services, therapeutic education, and speech and language support. They are also demanding a special allowance for hazardous working conditions in special education and at least one full-time administrative assistant at every school.

The demands extend to school infrastructure and workplace safety. Teachers want a comprehensive, sustainable climate-control plan for schools, the removal of asbestos, an end to phased construction of public schools and stronger occupational health and safety measures. They are also calling for an equity plan to ensure adequate support for students facing socioeconomic hardship, those with special educational needs and other vulnerable groups.

Teachers announced a larger demonstration for Wednesday afternoon, with a march planned from Atocha to Puerta del Sol, where people were continuing a protest camp in support of the public education movement. The strike’s first day brought demands for changes to staffing, funding, pay and school conditions alongside opposition to the regional government’s education policies.

European regional and local leaders have warned that the EU’s next long-term budget risks transferring control over investment programmes to national governments, potentially increasing economic disparities and reducing the ability of poorer regions to shape their own development.

The warning was delivered in Brussels on 12 October by Kata Tüttő, President of the European Committee of the Regions, during the opening of the European Week of Regions and Cities.

Her intervention comes as EU leaders prepare to negotiate the 2028–2034 budget, with disagreements over agricultural funding, regional development, defence, industrial competitiveness and the distribution of financial responsibilities among member states.

The Committee of the Regions warned that greater centralisation could concentrate economic opportunities in already prosperous areas while limiting other territories’ capacity to attract investment and develop essential infrastructure.

The concern goes beyond money allocated to regional development. It addresses who controls spending decisions and whether local authorities retain a meaningful role in determining how European funds are used.

Regional governments resist centralisation

EU cohesion policy has traditionally sought to reduce disparities between richer and poorer regions through investment in transport, infrastructure, education, business development and public services. While national governments administer considerable funds, regional and local authorities are frequently involved in identifying priorities and delivering projects.

The Committee argues that restructuring which concentrates decision-making at national level could weaken this arrangement. National governments may favour country-wide industrial or infrastructure programmes, while regional authorities identify specific problems arising from local conditions.

A national infrastructure strategy could prioritise major transport routes and industrial centres. Regional administrations might instead emphasise connecting smaller communities, maintaining local services or developing specialised economic activities.

The dispute concerns whether the next EU budget will maintain flexibility for regional priorities. In Belgium, Germany, Spain and Italy, regional institutions possess important responsibilities across economic development, education and infrastructure. Changes to EU spending governance could alter established relations between European, national and regional institutions.

The budget negotiations intensify the dispute

Ireland’s rotating Council presidency has proposed reducing the Commission’s original seven-year budget plans by approximately €141 billion while largely protecting agriculture and cohesion compared with other expenditure categories.

The proposed financial framework would nevertheless remain substantially larger than the current budget. The distribution of resources remains contentious, and an overall cut does not necessarily translate into the same reduction for every region.

Effects will depend on allocation formulas, national spending plans and programme governance. Meanwhile, European institutions face demands for stronger investment in defence production, digital infrastructure, competitiveness and support for Ukraine while maintaining agricultural and regional commitments.

Economic disparities remain a European problem

The Committee presented its seventh annual assessment of Europe’s regions and cities during the European Week of Regions and Cities, held in Brussels from 12 to 14 October.

The assessment examines competitiveness, resilience, public services, democratic governance and financial conditions. Regional disparities remain a significant feature of the EU economy despite decades of common investment programmes.

Large metropolitan areas often benefit from concentrations of universities, research institutions, advanced industries and capital. Less densely populated territories may struggle with demographic decline, shortages of skilled workers and the cost of maintaining infrastructure.

These differences can reinforce themselves over time. Businesses invest where suitable workers, transport networks and customers are already concentrated. Younger workers moving towards metropolitan economies may further reduce the economic prospects of communities they leave behind.

Defence spending creates new pressures

The increase in European defence expenditure introduces another dimension. Regions containing defence manufacturers, engineering firms, research institutions and military installations could benefit substantially from new spending, while others may receive little direct economic advantage.

If industrial investment concentrates in already advanced manufacturing centres, geographical disparities could widen. Conversely, procurement programmes and infrastructure investment could bring opportunities to weaker regional economies with suitable facilities and labour.

A question of political authority

The Committee of the Regions has limited formal authority over the EU’s long-term budget. National governments will negotiate the framework, and the European Parliament must consent to the final agreement.

Regional leaders are seeking to influence those negotiations before political compromises are established. Their central argument is that aggregate European economic growth alone does not capture the distribution of investment, employment and public services across the Union.

The approaching European Council negotiations will indicate whether governments intend to preserve regional influence over EU spending or concentrate greater authority over investment decisions at national level.

European Union governments are entering a critical round of budget negotiations after the Irish presidency of the Council proposed cutting €141 billion from the European Commission’s long-term spending plans, exposing deep disagreements over how the bloc intends to finance its expanding responsibilities.

The revised proposal, circulated ahead of the European Council meeting scheduled for 15–16 October, would reduce the planned 2028–2034 financial framework by approximately eight per cent to around €1.6 trillion, calculated in constant prices.

Despite the reduction, the proposed budget remains approximately 30 per cent larger than the current seven-year framework. Germany, Sweden, the Netherlands and other governments concerned about national contributions have nevertheless argued that further restraint is necessary.

The compromise, detailed in negotiations over the EU’s next financial framework, reduces proposed spending across several areas while largely protecting the Union’s established agricultural and regional development programmes. The distribution of those cuts is becoming as contentious as the overall size of the budget.

Europe’s new priorities face the deepest reductions

Under the Irish proposal, agricultural and regional development allocations would decline by approximately three per cent compared with the Commission’s initial plans. By contrast, funding intended for competitiveness and security would be reduced by around 13 per cent, while external action and development cooperation face cuts of approximately 17 per cent.

The difference raises questions about whether the next EU budget can support the strategic ambitions repeatedly endorsed by European leaders.

The Commission has presented industrial competitiveness, technological development, defence readiness and economic resilience as central priorities for the remainder of the decade. Yet these sectors would absorb proportionately larger reductions under the revised framework than agricultural and cohesion programmes.

The consequences could extend to investments in advanced technologies, European industrial supply chains, research programmes and cross-border defence cooperation. They could also constrain the Union’s capacity to fund external partnerships and development initiatives.

The debate is particularly sensitive because the EU’s responsibilities have changed considerably since the previous budget was negotiated. Russia’s invasion of Ukraine has increased defence requirements, while competition with China and the United States has intensified demands for industrial investment.

Germany and the net contributors demand restraint

The central disagreement concerns how much additional expenditure European governments are willing to finance through the common budget. Germany and other major net contributors face domestic fiscal constraints, rising borrowing costs and demands to increase national defence spending.

For these governments, accepting a substantially larger EU budget would add to financial commitments already being made through national budgets.

The Irish compromise therefore faces opposition from two directions. Some governments consider the reductions insufficient, while others fear that the remaining cuts will weaken programmes essential to their national economies.

Traditional recipients of agricultural and regional funding have an interest in protecting established expenditure. Governments seeking stronger European investment in defence, innovation and industrial competitiveness have different priorities.

The European Parliament is another obstacle. Its consent will be required before the final financial framework can enter into force, giving MEPs considerable leverage in negotiations with national governments.

New EU revenues remain controversial

The proposal also envisages approximately €55 billion in additional annual financing through new or revised EU revenue sources, including customs revenues, emissions-related income and corporate contributions.

The Commission’s framework for the next long-term budget reflects a broader debate over the extent to which the Union should develop independent financing mechanisms rather than rely predominantly on national contributions.

Such mechanisms would potentially give Brussels a more predictable revenue base. However, they also raise questions about fiscal sovereignty, the distribution of costs among member states and the political accountability of European taxation.

National governments remain reluctant to surrender substantial authority over revenue collection, particularly when proposed resources could impose costs on domestic industries or consumers.

Ukraine, enlargement and Europe’s strategic ambitions

The negotiations will influence the Union’s ability to respond to future enlargement. Ukraine and several Western Balkan countries are pursuing accession, but the financial implications of bringing additional members into the Union remain substantial.

Existing arrangements for agricultural subsidies and regional development assistance would require reconsideration if large new beneficiaries entered the budgetary system.

At the same time, the EU faces pressure to support Ukraine financially and strengthen defence production without depending indefinitely on extraordinary borrowing or ad hoc national contributions. These responsibilities cannot be addressed simply by preserving the structure of earlier budgets.

European Council President António Costa will seek to narrow the divisions among the 27 leaders, but agreement on the financial framework requires unanimity. Any government can withhold its consent if it considers the final distribution of costs unacceptable.

The forthcoming summit is therefore likely to establish the parameters of further negotiations rather than eliminate the underlying disagreements. The immediate political question is whether member states can reconcile their commitment to greater European strategic capacity with their reluctance to finance it collectively.

Seventeen EU governments have joined forces to defend agricultural and regional funding in the bloc’s next seven-year budget, setting up a confrontation with Germany and five other countries demanding substantial reductions to the European Commission’s proposed €2 trillion spending plan.

Seventeen European Union countries have called for agriculture and cohesion funding to be protected from further cuts as negotiations over the bloc’s 2028–2034 budget enter a decisive phase.

In a letter dated 2 October to Irish Taoiseach Micheál Martin, whose government currently holds the rotating presidency of the Council of the EU, the countries said the overall financing of Cohesion Policy and the Common Agricultural Policy should be maintained in the next Multiannual Financial Framework.

The signatories are Bulgaria, Croatia, Cyprus, Czechia, Estonia, Greece, Hungary, Italy, Latvia, Lithuania, Malta, Poland, Portugal, Romania, Slovakia, Slovenia and Spain.

The initiative follows months of coordination by the so-called Friends of Cohesion. In an earlier joint position published by the Spanish government, members argued that cohesion, agriculture and fisheries remained central EU policies and called for new EU revenue sources to be “genuine, fair, simple and non-regressive”.

Italian Prime Minister Giorgia Meloni and Romanian President Nicușor Dan have been coordinating the group at leaders’ level. They are expected to convene another informal meeting alongside the European Council on 15–16 October. The two leaders previously brought the group together ahead of the June European Council as governments sought to coordinate their positions on the budget.

The intervention places the group in direct opposition to Germany, Denmark, the Netherlands, Austria, Finland and Sweden.

Those six governments have argued that the Commission’s near-€2 trillion proposal should be reduced by several hundred billion euros. In their joint statement on the 2028–2034 budget, they said national governments were already undertaking fiscal consolidation and that the EU budget could not be exempt from similar pressure. They called for reductions across all spending headings while giving greater weight to security, defence, competitiveness, migration and sovereignty.

EU Today previously reported on the growing pressure from net-contributor countries for deep reductions to the Commission proposal as negotiations moved towards the Irish presidency’s attempt to secure an agreement before the end of the year.

The Commission’s original proposal for the 2028–2034 Multiannual Financial Framework amounts to almost €2 trillion in current prices, equivalent to 1.26 per cent of the EU’s average gross national income over the seven-year period. It substantially restructures the budget, bringing agriculture, cohesion, fisheries, migration and internal security into national and regional partnership plans while allocating more money to competitiveness, research, defence and other emerging priorities.

Agriculture and regional development have consequently become two of the most sensitive parts of the negotiations.

The Council has already backed the principle of the new national and regional plans, but financial allocations remain unresolved. Its negotiating position specifically leaves the money to be settled as part of the overall MFF talks.

EU Today has followed the dispute since the Cyprus presidency produced a negotiating framework in June that proposed reducing the Commission’s plan by about €32.8bn. The disagreement has since widened as governments attempt to reconcile traditional spending on farmers and poorer regions with growing demands for defence, industrial competitiveness and security.

Revenue is another source of disagreement.

The Commission has proposed five new EU own resources, including revenue connected to the Emissions Trading System and Carbon Border Adjustment Mechanism, a contribution based on uncollected electronic waste, a tobacco excise resource and a contribution from large companies operating in the EU. The proposals are intended partly to reduce reliance on national contributions and help finance repayment of pandemic-era borrowing.

EU Today previously examined the dispute over new sources of EU revenue after leaders asked the Irish presidency to develop financing options alongside negotiations over expenditure.

The Friends of Cohesion have also called for a more gradual repayment schedule for NextGenerationEU borrowing and oppose retaining contribution rebates for wealthier member states. Under the Commission proposal, repayments of principal and interest would amount to a fixed €24bn annually between 2028 and 2034, or €168bn across the seven-year budget period.

Ireland now faces the task of narrowing the gap.

The Council’s timetable for the negotiations envisages the Irish presidency advancing the next negotiating framework ahead of the October European Council, with governments seeking a political agreement before the end of 2026. That would leave 2027 for adoption of the legislation required before the new budget takes effect on 1 January 2028.

An agreement among governments will require unanimity. The European Parliament must then give its consent, while the separate decision governing the EU’s own resources also requires unanimous approval by member states and ratification according to their national constitutional procedures.

With 17 governments now explicitly defending agriculture and cohesion spending and six major contributors demanding substantial reductions, the October summit will bring the central budget dispute directly before EU leaders.