The COVID-19 pandemic, its ensuing crisis and the severe criticism faced by the EU for its lack of response prompted the European Commission to propose a revamped Multiannual Financial Framework (MFF), as well as a new recovery tool dubbed Next Generation EU (NGEU). Facing two opposing approaches from the Council – a Franco-German grants-based one and the loans-based one pushed by opponents of big spending – the Commission seemingly opted to merge the two and let the Council battle it out, thereby avoiding any further criticism that the EU has not done enough to remedy the crisis. It reflects the new priorities of the Commission and features some ambitious and controversial plans, such as a whole new range of funding for the EU in the form of various new levies on businesses.

This note presents how the change of priorities affected the EU’s long-term budget; initial reactions of main political stakeholders in the Member States and the European Parliament; how the money will be allocated in immediate responses to the economic crisis; and presents the breakdown of the MFF proposal compared to its defunct 2018 predecessor.