The current EU budget is not an effective instrument to implement the priorities of an expanding and deepening Union. Over 40% of EU spending is dedicated to support for agriculture, a declining sector; spending for research and innovation, the main driver of productivity growth, is too small; and there is no room in the budget for the new public goods of internal and external security. This Policy Brief argues that radical changes are therefore needed both in the content – its revenues and spending programmes – and in the decision-making procedures in order to endow the Union with an effective instrument to foster its policy goals. The latter is a precondition for the former. Only with a new procedure, in which European interests dominate, can the Union obtain a better budget. The European Parliament, which represents European citizens directly, must be given the main say concerning the structure of the budget, whereas the Council should provide appropriate safeguards against excessive spending.