Following the Special European Council in mid-July, Member State Prime Ministers and Presidents returned home, with most of them claiming victory of one sort or another on the recovery package and 2021-2027 budget agreement.
What was rarely mentioned was the fact that the budgetary gains of individual Member States, both from the regular Multiannual Financial Framework (MFF) and from the newly established Next Generation EU fund, were achieved at the expense of long-term, strategic goals.
The fact that the next framework programme, Horizon Europe, was cut from €94.4bn to €80.9bn is probably the most prominent example. The budget cuts for the main research and innovation (R&I) programme are in clear contradiction with the EU’s main political priorities, such as the Green Deal, the digital transition and European ‘technological sovereignty’ and leadership.
“An important responsibility here lies with national governments, who have not always been eager to make appropriate investments in their R&I systems”
Technological leadership of Europe implies that the Union is seeking to become a normative trendsetter in areas such as AI, machine learning, and quantum computing.
The EU is capable of attaining such a global role, but only if it can demonstrate its capacity to take concerted action and a common approach to problems. The European Research Area, launched 20 years ago, is still very weakly implemented, and R&I is still highly fragmented across Member States.
Of course, an important responsibility here lies with national governments, who have not always been eager to make appropriate investments in their R&I systems.
However, if Europe’s R&I funds are cut dramatically, the aim of achieving global technological leadership will be severely compromised. If, during the current crisis, some Member States invest more in their R&I systems than others, this could lead to increased fragmentation, weakening the credibility of future European leadership. Indeed, a common European approach to R&I is an existential question for the EU.
The Union faces challenges that cannot be met without appropriate investment in research, including flagship initiatives such as the European Green Deal, digital transition and societal resilience. The new Horizon Europe framework programme is well-engineered to meet these challenges, supporting researchers and industry throughout the whole R&I cycle.
The first pillar, ‘Excellent science’, will support researchers carrying out fundamental research. The second pillar, ‘Global Challenges and European Industrial Competitiveness’, deals with collaboration between the EU and industry in delivering research and innovation that can influence key areas of public interest such as health, accessibility, digital, industrial competitiveness, climate, energy, mobility, natural resources and food systems.
Finally, the third pillar, ‘Innovative Europe’, deals with market-creating innovation - an objective that’s badly needed for Europe’s economy. So, what needs to be done? First, nothing is agreed until everything is agreed. The European Parliament’s budget negotiators continue to insist on an additional €39bn to finance the top-ups to the flagship programmes of the Union, including Horizon Europe.
If Member States agree to this plan, Horizon Europe would receive several billion euros in additional funding. The results of the negotiations will become clearer in the coming weeks.
Second, investment in research should be prioritised in national recovery plans to ensure access to the grants of the Recovery and Resilience Facility. These plans are subject to consultation between EU Member States and the European Commission.
“If the Council were to agree to a new financial transactions tax, the EU could get extra revenue of more than €100bn in the next seven years alone and invest that into priority programmes including Horizon Europe”
We, the members of the Parliament’s Industry, Research and Energy Committee, have therefore encouraged the Commission and the Council Presidency to set guidelines for future projects and monitoring of the implementation of these initiatives, to ensure the EU meets its long-term objectives and guarantees its global position at the cutting edge of innovation and science.
We believe that the strong commitment of Member States to fostering investment in research and innovation through the Recovery and Resilience Facility will help in reaching an agreement between the co-legislators on the MFF.
Third, R&I investment should be encouraged in negotiating the national investment programmes under the European structural and investment funds.
Fourth, over the coming years, the EU should agree to allow the European Commission to raise its own new resources. If the Council were to agree to a new financial transactions tax, the EU could get extra revenue of more than €100bn in the next seven years alone and invest that into priority programmes such as Horizon Europe.
Fifth, upgrading the European Research Area (ERA), by promoting a single market for R&I. I am sure that Parliament will support the Commission’s proposal that Member States reaffirm the three percent EU GDP R&D investment target, including a new 1.25 percent EU GDP public effort target to be achieved by Member States by 2030.
Equally as important will be the coordination and prioritisation of national R&I funding and reforms between countries and with the EU. An important step could be a commitment by the Member States, by 2030, to invest at least five percent of national public R&D funding to joint programmes and European partnerships.
An important element of the new ERA will be to design instruments that support and encourage those Member States who are below the EU average in R&D investment with the aim of increasing their total investment in R&D by 50 percent in the next five years.