Luxembourg: The EU budget error rate rose to 3.8% of 2025 spending, the European Court of Auditors reported on 8 October 2026, up from 3.6% in 2024 and well above the 2% materiality threshold. The figure excludes the recovery fund and measures spending that broke EU or national rules, not fraud. The auditors separately reported 17 suspected fraud cases.
Behind the EU budget error rate, the Court gave the accounts a clean opinion but issued an adverse opinion on spending for a seventh year in a row. Cohesion drove the slide, with its error rate climbing from 5.7% to 6.6%, while agriculture and environment rose from 2.6% to 3.9%, according to Euronews. The Commission puts its own cohesion estimate at 2.3%, a number the auditors consider likely too low.
Debt gives the EU budget error rate extra weight this year. Outstanding EU borrowing grew by more than 20% to €738.9 billion in 2025 and could reach €1 trillion by 2027, mainly because of NextGenerationEU. Repayment runs from 2028 to 2058, and liabilities backed by the EU budget could reach €664 billion by 2027.
The next long-term budget turns those numbers into a political fight. The Commission proposes a fixed €24 billion a year to repay NextGenerationEU debt, with interest paid first. Interest alone could cost about €93 billion over seven years, more than half of the €168 billion total, and the auditors note that expected borrowing costs are double the initial estimates.
Recovery fund checks drew sharp criticism too. Nine of 37 grant payments last year breached the rules, yet the Commission paid them, and 29 of 32 plan changes lacked enough evidence. More than €122 billion, over a third of recovery grants, remained unpaid going into the final year. The Commission replies that it checks milestones before payment and sees low risk.
Court President Tony Murphy warned that new borrowing could force member states to raise their national contributions. He said, “Ambitious budgets demand equally ambitious safeguards.” His words land as six frugal net contributors push to cut several hundred billion euros from the roughly €2 trillion proposal, while 17 other states want a more ambitious budget.
The auditors also flag a structural problem. Every additional euro of debt service leaves less room for programmes, so the EU budget error rate matters twice: it shows money spent against the rules, and it tests how much trust capitals will place in a larger budget. Net contributors will point to the 3.8% result in every negotiating round this autumn.
Leaders discuss the financing of the 2028 to 2034 budget at their Brussels summit on 15 and 16 October. Commission President Ursula von der Leyen opposes deep cuts and wants new EU revenue sources. The EU budget error rate and the debt trajectory will shape whether capitals accept that case or insist on tighter safeguards.
