The Multiannual Financial Framework of the European Union: A Political Power Game

The present multiannual financial framework (MFF) 2014-2020 of the European Union (EU) is the first long-term budgetary framework of the Union under the Treaty of Lisbon. The MFF has been called a political power game between the institutions of the Union. This paper looks at the financial effects of the new MFF caused by the changing financial powers under the new Treaty. The two guiding questions are: (1) What does the MFF, or more in general a fiscal rule, look like?; and (2) Does the MFF really constrain the EU budget? The paper shows the results of the constitutional/political power game within the new framework. In general it can be said that the key to understanding the outcome of the negotiations is flexibility: increased flexibility of the existing budget and new flexible off-budget expenses. Accounting, disguised as flexibility measures, has become a form of transparent budget gimmickry: although the new MFF is nominally lower than its predecessor, Member States in fact have to pay more.