ICLEI together with partners from the Local Alliance, uniting Europe’s leading city and regions networks, is putting forth clear recommendations for the next EU budget (2028–2034) in this joint position paper. In the paper, the Local Alliance envisions an EU budget that acts as a long-term investment tool, that simplifies support for place-based investments and elevates the role of local and regional governments for a just, climate-neutral and competitive Europe with thriving cities and regions.