European leaders reached an agreement on the EU's €1.8 trillion budget after a marathon summit back in July.
But, before any funds can be allocated, MEPs' consent will be needed.
The battle over that got underway today (Tuesday, September 1) when MEPs came up with a negotiating strategy.
They want to convince European leaders and Brussels to: boost EU programmes that have previously suffered cuts, introduce new sources of revenue and, crucially, to link funding to a country's respect for the rule of law.
This final point is turning into the main battleground. But it will be difficult to get the 27 EU governments to agree with the setup of a mechanism that will freeze funds for countries that violate rule of law principals.
MEP Rasmus Andresen, the EU budget negotiator for the Greens/European Free Alliance grouping in the European Parliament, said they will put up a serious fight over this issue.
“This is key because it is not just about distributing money, it is about our common values," Andresen said.
"On the other side, you have some state leaders like Viktor Orban saying that they cannot agree on a strong rule of law mechanism because they fear they will have budget cuts.
"This is quite complicated and will end up being one of the most controversial questions left to the end.”
But legal challenges could be on the horizon if such disciplinary tools are used on issues other than corruption, such as judiciary reform or freedom of speech.
One expert, Jorge Núnez Ferrer, who is a senior research fellow at the Centre for European Policy Studies (CEPs), said you “cannot penalise a country for breaking one rule with a completely different instrument”.
MEPs are also trying to get more money for programmes that have suffered cuts and to repay the debt created by the new pandemic recovery fund, with binding commitments to create new taxes.
Jan Olbrycht, a Polish MEP for the European People’s Party, said that there should be "a stable and predictable situation to paying back the credit”.
However, some are arguing that the EU’s coronavirus recovery fund could cause complications.
“It’s clear that countries have had problems using EU funding in the past and now you have the huge EU next-generation programme in the budget and there will be complications," said Núnez.
"There could be some agreement on the parliament's budgetary control so that the parliament should be involved in the budgetary control of the programmes.”
The EU’s budget will need to be approved by national parliaments before coming into force on New Year’s Day 2021.