From regulatory to financial capacity

The European Union has traditionally been understood as a polity built primarily through market integration and regulation. Its budget was comparatively small, its capacity to raise revenue constrained, and redistribution remained limited.

That model is changing. Common borrowing, debates over new own resources, and the growth of EU spending instruments have placed public finance closer to the centre of European integration. The Recovery and Resilience Facility, the Just Transition Fund, and investments in energy, digitalisation and competitiveness illustrate an EU that increasingly pursues common objectives by mobilising and allocating financial resources.

This development raises questions that go beyond the size of the EU budget. Revenue and spending create political relationships: between contributors and recipients, between the Union and Member States, and between public authority and citizens. Financial incentives and conditionality can redistribute resources, steer national policy, and determine access to common benefits. They therefore affect not only what the EU does, but how political authority within the Union is constituted and exercised.

The conference explores the implications of this transformation.

In particular, it will consider:

• What challenges for democratic authority and legitimacy arise when the EU increasingly raises its own resources and incurs common debt?
• What forms of governance, solidarity, or political contestation are gained or lost when money increasingly complements or replaces regulation as a mechanism of European integration?
• How does the growing use of financial incentives and conditionality shape the relationships between the Union, Member States, and citizens?

These questions are becoming more pressing as the EU confronts demands to support Ukraine, finance the green transition, prepare for enlargement, and strengthen Europe’s economic and geopolitical resilience. Each requires resources on a scale that puts pressure on the Union’s traditional model of governance. As a result, current negotiations over its next Multiannual Financial Framework and own resources are no longer merely technical debates about financing. They are increasingly contests over who belongs, what the Union stands for, and what kind of political community Europe seeks to become.