Municipalities and regions explore new approaches to budgeting, from participatory and priority-based models to green and SDG-oriented practices
Municipalities, cities and regions across Europe are at the forefront of delivering essential services, from housing and health to climate action and mobility. Yet, they face increasing financial pressures, recovering from the pandemic’s “scissor effect” of higher costs and lower revenues, and coping with inflation. In this context, how budgets are designed and allocated has become a powerful political tool.
To explore this potential, the Council of European Municipalities and Regions (CEMR) organised a training event on 23 May titled “X-budgeting – the power of subnational finance.” The session brought together experts and practitioners to share knowledge on innovative approaches to local and regional finance.
“X-budgeting” refers to a range of methods that go beyond simple accounting, transforming budgets into instruments for shaping policy and engaging citizens. These include:
- Priority-based budgeting, aligning spending with political or community priorities rather than repeating last year’s allocations.
- Process-based budgeting, such as participatory models that involve residents directly in decisions.
- Green and SDG budgeting, aligning local finances with climate goals and the Sustainable Development Agenda.
Each approach offers opportunities, from fostering transparency and boosting trust to mobilising investment for sustainability, but also poses challenges, such as methodological complexity, resource needs and the demand for strong political support.
By experimenting with new forms of budgeting, municipalities and regions can make financial choices that not only keep services running but also reflect citizens’ voices and accelerate progress towards long-term goals.
For more information, contact:
Advisor – Territorial Cohesion & Local Finances
