A new proposal to boost European Union funding without imposing new taxes has been put forward by Greece’s Minister of National Economy and Finance and Eurogroup President, Kyriakos Pierrakakis. According to Politico, he is proposing that a portion of revenues from mobile spectrum auctions — which currently flow into national budgets — be redirected to Brussels. The proposal comes at a time of intense negotiations over the EU’s new seven-year financial framework and is part of the broader debate on identifying new sources of revenue at the European level.
“It’s telecoms policy à la Draghi,” he said, referencing the proposals put forward by former Italian Prime Minister Mario Draghi to strengthen Europe’s competitiveness. These include better coordination and harmonisation of the processes through which member states allocate the frequencies used by mobile networks — something which, he argues, would also support the development of pan-European technological infrastructure.
EXCLUSIVE: Greek Finance Minister Kyriakos Pierrakakis is floating a potentially bold new way to raise money for the EU:
Redirect lucrative proceeds from national spectrum auctions to Brussels.
But the idea will be a tough sell.
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Criticism of the current system
Currently, telecom providers across Europe must participate in separate national procedures to acquire spectrum, with auction revenues flowing into state budgets. According to Connect Europe, the European telecoms industry association, companies have spent more than €50 billion securing spectrum licences since 2020.
This practice has faced repeated criticism, as it is widely seen as placing a financial burden on providers rather than encouraging new investment. Former EU Commissioner Thierry Breton previously described spectrum as a “cash cow” for governments.
Greece’s model as a blueprint
Kyriakos Pierrakakis proposed that Europe look to Greece’s 2020 experience as a model, which he described as the “most innovative auction” of its kind. At the time, Greece chose to allocate 25% of spectrum auction revenues to the creation of a venture capital investment fund, aimed at financing companies operating within the 5G ecosystem.
The proposal for the European budget
The Eurogroup President’s proposal envisions the following structure: 75% of spectrum auction revenues would be directed to the EU’s Multiannual Financial Framework (MFF), while the remaining 25% would be channelled into a dedicated investment fund managed by the European Investment Bank (EIB).
According to Pierrakakis, such a model would allow Europe to deploy significantly greater resources for investment and growth initiatives.
