The Luxembourg-based European Court of Auditors (ECA) is one of the EU’s seven core institutions and serves as its independent external auditor. This year is the 50th since the court’s foundation under the Treaty of Brussels.
As an auditor by profession, I have dedicated most of my career to public sector audit. I was appointed as the Irish member of the ECA by the Irish government in 2018, and began my second three-year term as the ECA’s president in October 2025.
While I am becoming quite familiar with this role, I recognise that our core audit function focusing on the EU budget remains constant. However, as EU budget priorities evolve, so too do the delivery models used to implement these budgets. Consequently, the ECA’s focus, strategic direction and methodologies must adapt to meet these changing circumstances.
By 2027, outstanding EU debt will be 10 times the pre-Covid figure
October 2025 also marked the publication of the ECA’s annual report, which represents our central treaty obligation. The report examines EU revenue and expenditure, providing an independent audit opinion on the reliability of accounts and the legality and regularity of the underlying transactions.
Budget management
An important focus of our annual report includes the financial management of the EU’s budget. One of the key findings of the 2024 report is that outstanding EU borrowing is projected to exceed €900bn by 2027 – over 10 times the level of EU debt prior to the pandemic.
This dramatic increase is primarily due to the €650bn Next Generation EU (NGEU) temporary recovery fund, which represents the first large-scale borrowing by the EU. Launched in response to the economic fallout from Covid-19, NGEU-issued bonds finance recovery efforts across member states, thereby enabling the EU to mobilise substantial resources.
However, as we assess the situation four years after the bonds were issued during a period of historically low interest rates, total interest expenditure on NGEU is expected to surpass €30bn for the current budgetary period, more than double the European Commission’s initial forecast of €15bn. Most repayment obligations are deferred to future multiannual financial frameworks (MFFs), yet the Commission has not established a definitive funding source for servicing this debt. With repayments set to begin in 2028, the repayment of NGEU borrowing could impose an annual burden of up to €31bn on future EU budgets.
To ensure the sustainability of future EU budgets, we emphasise the need to carefully consider the growing burden of borrowing-related obligations. Rising debt obligations present significant challenges in both safeguarding future budgets and securing adequate resources for EU actions.
It is crucial to prepare ourselves to effectively audit defence spending
Priorities and resources
As we discuss EU actions, it’s important to acknowledge the evolving landscape of priorities. The EU’s growing list of emerging priorities include defence and security, enlargement and bolstering global competitiveness. Climate change has been a priority for a number of years, while agriculture and cohesion continue to be EU staples. However, these diverse and often competing priorities underscore the need for careful resource allocation – there are, after all, only so many pieces of cake to go around.
The MFF is the EU’s seven-year budget plan, which establishes a framework for allocating resources within the Union. This year, the Commission published its proposals for the 2028–34 MFF. The proposals include an increased focus on defence and security, reflecting the evolving geopolitical landscape and the EU’s desire to enhance its strategic autonomy. For us as auditors, it is crucial to adapt to this shift and prepare ourselves to effectively audit defence spending. We must equip ourselves with the necessary expertise and knowledge to evaluate how funds are allocated and used in this area.
As auditors, we not only provide audit opinions, but, specifically in the EU context, we are also tasked with providing opinions on certain legislative proposals that carry a financial impact. Currently, we are preparing opinions requested from the co-legislators – the European Council and the European Parliament – on the MFF proposals.
Future delivery models
Another significant proposed change is the preference for funding delivery models that are performance-based or not linked to costs. This approach was first implemented on a large scale by the EU for the Recovery and Resilience Facility (RRF), the NGEU’s primary funding mechanism. We have built an extensive body of audit work for this funding model. This year, with one eye on the future MFF, we took stock and summarised the audit work we have carried out on the RRF in the form of a review.
New models must link to measurable results and traceable costs
The review’s findings aim to inform any future delivery models not linked to costs, offering key insights and lessons learned. We assert that such models should be employed only when funding is directly linked to measurable results and traceable to actual costs. It is crucial that their design and implementation uphold accountability.
Our opinions, to be published in the first quarter of 2026, will likely include these risks and concerns. We hope they are taken on board and duly considered within the legislative process to ensure that the EU’s financial interests are adequately protected going forward.
As an institution, we will continue to adapt and evolve to meet the challenges facing the EU. This evolution is reflected in our recently published annual work programme for 2026, as well as our new strategy for 2026 to 2030.
The ECA’s mission remains steadfast: to reinforce trust through audit and to contribute to the EU’s broader ambition for a Europe that is free and democratic, strong and secure, prosperous and competitive.
