Kemi Badenoch has said a "red warning light" is flashing on the economy as Britain's debt tops £3 trillion for the first time and inflation surges to 3.5% ahead of the Budget next week.
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The EU is pressing allies, such as the UK, Canada, Japan, South Korea, Australia, and Norway, to help close a €70bn shortfall in Ukraine’s funding for next year, after president Volodymyr Zelensky warned that the war will cost €155bn in 2027.
EU Council president António Costa told MEPs in Strasbourg on Wednesday (21 October) that member states already provided 80 percent of external aid to Ukraine and “international partners must also step up their efforts”.
“Our commitment to peace must go hand in hand with sustained pressure on the aggressor,” he also said, after meeting Zelensky at an EU summit in Brussels last week.
European Commission president Ursula von der Leyen also told MEPs on Wednesday: “The war will not be decided on the frontline; the war will be decided in our political will, in whether we stand up for freedom and democracy and support our Ukrainian friends.”
Zelensky’s €155bn figure refers to Ukraine’s total war-related spending in 2027, part of which Kyiv covers from its own budget.
But that still left a €70bn gap that Ukraine needed foreign partners to fill, as next year approached.
The EU has already agreed a €90bn loan covering 2026 and 2027, meant to meet two-thirds of Ukraine’s financing needs over that period.
The remaining third was supposed to come from other partners, but so far that money has been secured only for 2026, not for 2027.
Costa told MEPs on Wednesday that €16bn had been disbursed this year under the defence line of the loan, while another €17bn could be sent to Ukraine if anti-corruption reforms were implemented.
“Our determination to support Ukraine and its people is stronger than ever,” he said.
Meanwhile, EU commissioner Maroš Šefčovič also indicated on Monday that Britain will be asked to increase funding to Ukraine, speaking ahead of an EU-UK summit on 20 November.
“Following the signature of a contribution agreement on 13 July 2026, the UK can now participate under the EU’s €90bn Ukraine support loan,” he said.
Both the EU and UK would support Ukraine “as long as it takes to bring Russia’s illegal war of aggression to an end”, Šefčovič added.
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Portugal’s Socialist Party is bringing together its main leaders today to discuss the position to take in the vote on the State Budget for 2027 (OE2027). The party’s secretary-general, José
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Wednesday’s European Parliament debate on the October EU summit brought that contradiction into focus. The dispute over the 2028–2034 Multiannual Financial Framework is becoming a test of whether Europe can translate geopolitical urgency into durable financial commitments.
According to Parliament’s account of the debate, European Council President António Costa wants agreement before the year’s end. He advocated an ambitious budget while keeping national contributions reasonable, alongside progress on new EU revenue sources.
Those objectives are politically attractive. Reconciling them will require difficult choices over spending, taxation and the distribution of authority.
MEPs challenged the assumption that the Union can keep expanding its responsibilities without providing additional resources. Speakers identified support for Ukraine, industrial competitiveness, agriculture, regional development and household living costs among competing priorities.
Their argument has force. A budget negotiated around yesterday’s compromises risks leaving Europe poorly equipped for tomorrow’s threats. Yet calls for ambition become less persuasive when they avoid specifying which programmes deliver measurable European benefits.
The emerging distribution of cuts illustrates the problem. As EU Today previously reported, the Irish presidency’s compromise proposed reducing the Commission’s plans by approximately €141 billion, with competitiveness and security facing proportionately deeper reductions than agriculture and cohesion spending.
That creates an uncomfortable possibility: the policies most closely associated with Europe’s strategic renewal could become bargaining chips in negotiations dominated by established beneficiaries.
Protecting farmers and poorer regions has clear economic and political justification. Nevertheless, preserving familiar allocations while squeezing newer priorities would undermine leaders’ repeated promises to strengthen European independence.
Energy offers perhaps the clearest example of why spending decisions and structural reform must advance together.
Commission President Ursula von der Leyen told MEPs that dependence on imported fossil fuels and the absence of a genuine European energy union were weakening Europe. Costa emphasised affordable production and modernised electricity grids.
The implication is significant. Industrial subsidies cannot indefinitely compensate for an energy system that leaves European manufacturers facing persistently high costs. Cross-border connections, infrastructure investment and better market integration therefore belong at the centre of competitiveness policy.
Von der Leyen also pressed governments to complete the single market and avoid making European rules more complicated through national implementation. Her argument highlights a limitation of the budget debate: additional money cannot, by itself, remove regulatory fragmentation.
The same distinction applies to China. The Commission president described heavily subsidised Chinese competitors and promised action on dependencies, supply chains and market access. Such measures require coherent enforcement and political resolve alongside investment.
Ukraine adds a security imperative that cannot readily be postponed. Costa linked Ukrainian and European security, while MEPs warned about the consequences of weakening support. Long-term commitments require predictable financing rather than recurring emergency bargains.
But the budget dispute also concerns who controls the money.
As EU Today’s reporting on regional concerns explained, local leaders fear that restructuring could concentrate investment decisions in national capitals, weakening regional influence and potentially widening disparities.
That warning deserves attention. A larger European budget would not automatically produce more balanced development. Allocation rules, accountability and local participation will help determine whether spending strengthens cohesion or reinforces existing advantages.
New revenue sources could ease pressure on national contributions, but they cannot make financing politically painless. Costs ultimately fall somewhere, and governments must explain the distribution honestly.
The central challenge is therefore broader than securing agreement on a headline figure. Europe needs a settlement that protects essential commitments, finances credible common priorities and demonstrates results.
MEPs are right to demand resources consistent with Europe’s responsibilities. Governments are entitled to demand discipline. The failure would be a compromise that satisfies neither requirement: expensive enough to provoke domestic opposition, yet too fragmented to provide the strategic capacity Europe’s leaders insist is indispensable.
University students, and those in other forms of higher education, will be protesting today in front of the government’s headquarters, at Campus XX1, against the proposal in the 2027 State
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Niculescu secured 280 votes in favour and 58 against, comfortably exceeding the 233 required for confirmation. His ministers were sworn in before President Nicuşor Dan at the Cotroceni Palace in Bucharest later that evening, formally ending the prolonged government formation process.
The new administration comprises 18 ministers, including two delegated ministers. The Social Democratic Party (PSD) controls the majority of portfolios, while independent specialists hold several important positions, including finance and foreign affairs.
The appointment represents a political success for President Dan, who nominated Niculescu on 5 October following three unsuccessful attempts to assemble a functioning government.
EU Today reported earlier this month on Niculescu’s nomination, which followed the collapse of previous negotiations and growing pressure on Romania’s political institutions.
The new cabinet is heavily dependent on agreements between parties that have frequently disagreed over economic policy and public spending. Although the parliamentary vote demonstrated sufficient support for its installation, the arrangement does not provide the government with a permanent majority.
The National Liberal Party (PNL) and the Democratic Alliance of Hungarians in Romania (UDMR) supported the investiture while remaining outside the administration.
The arrangement gives Niculescu an opportunity to govern, but each major legislative proposal will require continued cooperation between parties with competing priorities.
The Social Democrats, who hold 11 of the ministerial positions, will exercise substantial influence over domestic policy, particularly decisions involving public-sector spending, welfare and taxation.
Romania’s public finances represent the government’s most urgent problem.
The previous administration, led by Ilie Bolojan, collapsed in May following unpopular austerity measures. Political opposition to fiscal consolidation has complicated efforts to stabilise the budget and meet Romania’s commitments under the European Union’s fiscal framework.
Niculescu has indicated that addressing the deficit will be an immediate priority. Finance Minister Alexandru Nazare, appointed as an independent, faces the task of establishing a credible budget programme without provoking another parliamentary crisis.
The choices are politically difficult. Spending reductions risk resistance from public-sector employees and households already affected by higher living costs, while substantial tax increases could place further pressure on businesses and consumption.
Failure to establish a credible fiscal programme would prolong uncertainty over Romania’s borrowing requirements and its ability to comply with European budgetary obligations.
Brussels has a direct interest in the outcome. Romania remains subject to EU fiscal oversight, and the European Commission will assess whether the new administration’s financial plans are consistent with the country’s obligations.
The government’s credibility will depend on whether its parliamentary supporters are prepared to approve the measures that fiscal consolidation requires.
The change of government also comes at a sensitive moment in Romania’s relationship with European institutions.
Romania has faced scrutiny over reforms linked to the EU’s Recovery and Resilience Facility, particularly legislation concerning public integrity and institutional accountability.
EU Today previously examined the European Commission’s assessment of Romania’s integrity legislation and its implications for recovery funding.
Although the EU recovery programme reached its principal implementation deadline in August, outstanding assessments and financial decisions continue to carry consequences for national budgets.
A functioning government is therefore important not only for domestic legislation but also for negotiations with Brussels over fiscal commitments, investment and the wider EU budget.
Romania must also address longer-term weaknesses in public administration, infrastructure financing and the implementation of European legislation.
Niculescu takes office against the background of Romania’s unusually turbulent political history since the annulment of the 2024 presidential election amid allegations of Russian interference.
The subsequent institutional disputes damaged confidence in the political system and contributed to the fragmentation of parliamentary support.
Opposition parties, including the nationalist Alliance for the Union of Romanians (AUR), are positioned to challenge the government’s legitimacy and economic measures as the administration begins work.
Romania’s strategic importance extends beyond its domestic political difficulties. As an EU and NATO member bordering Ukraine and Moldova, it plays a substantial role in Black Sea security, military logistics and regional infrastructure.
Prolonged instability in Bucharest has therefore affected a country whose decisions carry consequences for European security and cross-border economic cooperation.
For the new prime minister, the immediate objective is to translate Tuesday’s parliamentary majority into support for legislation. His first serious test will come when the cabinet presents the fiscal measures that its supporters have so far struggled to agree upon.
The parliamentary vote has ended Romania’s government formation crisis. It has not resolved the disagreements that produced it.
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