Germany news: Merz revolts over EU budget, report says

German Chancellor Friedrich Merz and European Council President Antonio Costa attend a press conference at the Chancellery in Berlin, Germany, September 9.Image: Halil Sagirkaya/Anadolu Agency/IMAGOAdvertisementSkip next section What you need to knowWhat you need to know Friedrich Merz and five others threaten to block EU budget proposal EU budget proposal slated to be approved by end of year by all 27 EU states Coalition talks are underway in Mecklenburg-Western Pomerania Catch up on thelatest news out of Germany on September 29, 2026, here:

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Coalition talks are underway in the Baltic state of Mecklenburg-Western Pomerania.

The Social Democrats (SPD) are meant to meet with the Green Party to talk about forming a government. The SPD met with the socialist Left Party yesterday too.

A coalition between the Social Democrats, the Greens, and the Left Party is the only viable option in the state to keep the far-right Alternative for Germany (AfD) out of the math.

The AfD won the contest in Mecklenburg-Western Pomerania with 38.2% of the vote but has no option to govern the state since none of the other parties will work with it.

The SPD, which has long governed the state, finished second with 35.5% of the vote. 

German Chancellor Friedrich Merz and his counterparts from five other nations have threatened to withhold their approval to a seven-year European Union budget proposal unless it were slashed by billions of euros as they've demanded for.

Merz and leaders from the Netherlands, Sweden, Denmark, Austria and Finland have signed a letter to make clear their wish to have the proposed budget trimmed by billions of euros or see it blocked, according to the Financial Times.

The budget for 2028-2034 was outlined by the European Commission last year and needs to be approved by all EU countries.

The proposed budget was set at nearly €2 trillion ($2.33 trillion) and parties involved are hoping to reach an agreement by the end of 2026.

The proposed amount is significantly higher than the current one set at between 2021 and 2027.

Merz earlier this month said cuts should apply across all policy areas and rejected relying on further joint EU borrowing to bridge the gap.

"Excessive debt ​threatens our sovereignty ⁠and our capacity to act," Merz said earlier this month, adding that governments had the "admittedly painful task" of setting priorities.

The German leader has called for the bloc's next budget to shift spending toward competitiveness and defense, arguing that a "20th-century budget" could not address current challenges.

The EU budget is funded primarily through contributions from member states, either in the form of national contributions calculated on the basis of gross national income or as a percentage linked to national VAT revenues.

As the EU's largest economy, Germany contributes the largest amount in absolute terms. 

Guten Morgen and welcome to the Tuesday edition of the Germany blog.

We're looking at sharp disagreements over the proposed European Union budget that member states want to see approved by the end of this year.

German Chancellor Friedrich Merz and his counterparts from five nations have threatened to withhold their approval unless they see the proposal trimmed by billions of euros.

Meanwhile, coalition talks continue in the state of Mecklenburg-Western Pomerania where the Social Democrats, the Green Party and the Left Party are hoping to form a government.