Budgetary powers 

The European Parliament shares the power to decide on the entire annual budget of the EU with the Council of the European Union and it has the final say.

Find out about the annual budgetary procedure from our infographic below.

Budgetary Procedure

Institutions concerned by the procedure:
  • European Parliament 
  • European Commission 
  • Council of European Union 

  1. Before 1 September

    Short description: Draft budget

    1. European Commission  prepares the draft budget  
    2. Draft Budget is submitted to:   
      • Council of European Union  (composed by 27 national ministers )
      • European Parliament 

    Complete text: Draft budget

    All EU institutions draw up their estimates for the draft budget before 1 July each year.

    The Commission consolidates these estimates and prepares the annual draft budget, which is submitted to Parliament and Council no later than 1 September.

  2. Before 1 October

    Short description: Council position

    •   Council's side: Council position is forwarded to Parliament
    • Parliament's side: Internal discussions on the draft budget. The conclusion is delivered to the Budgets Committee

    Complete text: Council position

    The Council adopts its position on the draft budget and forwards it to Parliament before 1 October, along with the reasons for its position.

    At the same time, parliamentary committees discuss the draft budget and deliver their opinions to the Budgets Committee, which is responsible for preparing Parliament's position.

  3. Maximum 42 days

    Short description: Parliament's position

    1.   Budgets Committee has to prepare a position for the Parliament.  
    2.   European Parliament  receives the Council position and the position of the Budgets Committee.
    3. MEPs vote the position prepared by the Bugdet Committee and any tabled Amendments .  
    4. Parliament position . If the Parliament modifies the project, it is forwarded to the Council.  

    Complete text: Parliament's position

    Parliament has 42 days either to approve the Council's position, or, by an absolute majority of its members, to amend it. MEPs vote on the position prepared by the Budgets Committee and any tabled amendments, usually during a plenary session in October.

    If Parliament approves Council's position, or declines to state a position, the budget is deemed adopted. However, Parliament normally adopts amendments and the amended text is forwarded to the Council. In this case, the President of the Parliament immediately convenes a meeting of the Conciliation Committee. The committee does not meet if the Council informs Parliament within 10 days that it has approved all of its amendments.

  4. Maximum 21 days

    Short description: Conciliation

    1.   Conciliation Committees (composed by 27 Council Representatives and 27 Members of European Parliament ) has to reach an agreement  
    2.   Join text is created.  

    Complete text: Conciliation

    The Conciliation Committee, composed of representatives of the Council and an equal number of members representing Parliament, has 21 days to reach an agreement on a joint text.

  5. Maximum 14 days

    Short description: Adoption

    If the join text is validated:   European Parliament  and   Council of European Union  have 14 days to approve it.

    Complete text: Adoption

    If the Conciliation Committee agrees on a joint text, Parliament and Council have 14 days to approve it. The President of Parliament then signs the budget and declares that it has been definitively adopted.

    If the conciliation procedure fails, or if the joint text is rejected by Parliament, the Commission submits a new draft budget. If the joint text is rejected by the Council, Parliament may still decide to adopt it.

Multiannual Financial Framework

Parliament and Council decisions about annual expenditure and revenue must fall within the annual spending limits laid down in the EU’s long-term financial plan, known as the Multiannual Financial Framework.

The long-term financial plan is negotiated for a period of usually seven years. The plan is based on a proposal by the European Commission and has to be adopted unanimously by the EU governments represented in the Council. Before that, it has to receive the consent of the European Parliament.

Budgetary control

Once the EU budget is adopted, the European Commission is responsible for its implementation (other institutions are in charge of their own administrative budgets).

As a directly-elected institution representing EU taxpayers, the European Parliament exercises democratic oversight to make sure that the Commission and the other institutions deal properly with European funds.

The Parliament, on a recommendation from the Council of the European Union, decides whether to grant the discharge, i.e. final approval of how the budget for a specific year has been implemented.

The Parliament takes the decision after careful examination by its Committee on Budgetary Control of the financial accounts of the Commission and the report on its activities for the year in question. It also takes into consideration the Court of Auditors’ annual report and the responses of the Commission on specific questions that MEPs may have.

The Parliament may also make recommendations to the Commission on the execution of the budget. The Commission has to report, at the request of Parliament, on the measures taken in light of such observations and comments.

The procedure ends in the granting, postponement or refusal of the discharge.

The Parliament deals in a similar manner with the approval of the accounts of other institutions, including its own administrative budget.