Implementing effective Green Budgeting practices in the European Union

Green budgeting is an essential lever to align public finances with sustainability and resilience priorities: it enables the identification, assessment and reporting of expenditure and revenue that have an impact on climate and environmental objectives. 

Following the Green Budgeting Training Programme (2021-2024), which trained more than 1,200 civil servants in 23 EU Member States, ten States have requested support from the European Commission. They want to institutionalise and implement concrete measures related to green budgeting, while taking into account their articulation with other European frameworks such as the Do No Significant Harm (DNSH) principle and the European taxonomy. 

The Green Budgeting project is being implemented under the supervision of the EU Reform and Investment Task Force (SG REFORM), which supports Member States in designing and implementing structural reforms that contribute to the economic, social and territorial cohesion of the European Union. 

This project is part of a European context marked by the reform of the economic governance framework that came into force in April 2024, the implementation of Directive (EU) 2024/1265 on climate-related budgetary risks and the rise of the European Green Deal. 

The Green Budgeting project aims to strengthen the capacity of public administrations in ten EU Member States to design, implement and institutionalise green budgeting practices. Beyond simply labelling expenditure, this initiative supports the development of green budgetary methodologies and the sharing of experiences between administrations.

More specifically, the project aims to: 

• develop and apply green budgeting methodologies tailored to each national context;
• strengthen governance frameworks and inter-institutional coordination;
• improve the monitoring and reporting of climate- and environment-related expenditure;
• promote consistency between green budgeting and other European sustainability policies (DNSH, taxonomy, Green Deal);
• consolidate the European community of green budgeting practitioners through the exchange of knowledge and good practices.

The project consists of two complementary areas of operations: 

1. Targeted technical support: individualised support is provided to five countries – Cyprus, the Czech Republic, Denmark, France and Portugal – to develop their green budgeting methodologies, strengthen their governance frameworks and build appropriate information and monitoring systems. Each national work plan includes training activities, joint methodology development and pilot solution testing.
2. Exchange programme for civil servants to promote networking, exchanges of experience and the dissemination of best practices. This programme bring together the five beneficiary countries from the first area of operation, as well as Croatia, Ireland, Slovakia, Slovenia and Spain. Other Member States may participate on request, in order to strengthen collective learning at European level. 

These activities build on previous work by the European Commission (reference frameworks, analytical notes, surveys of national practices, “green” and “brown” benchmarks) and on lessons learned from the multicountry DNSH project (2023-2025). 

The project should enable: 

• improved transparency and traceability of public expenditure related to the ecological transition;
• strengthened budgetary governance and inter-institutional coordination;
• skills development for public officials through targeted training and exchanges;
• the gradual integration of green budgeting into national and local budget cycles;
• better coordination with other European sustainability tools, in particular the DNSH principle and the green taxonomy. 

Ultimately, the project will contribute to better alignment of budgetary policies with the European Union's climate and environmental objectives, thereby supporting the transition to a sustainable, competitive and resilient European economy.