04 Oct 2018   |   News

The battle for Horizon Europe

The European Commission has hit a brick wall of member state objections to key proposals for the next EU research programme. With the clock ticking, Science|Business assesses the chances of reaching agreement before the May 2019 elections

Negotiations on the next EU research programme are not going as hoped for by the European Commission, with Europe’s 28 research ministries pouring cold water on several key proposals for the €94.1 billion Horizon Europe programme, set to start in 2021.

The Commission wanted greater flexibility in setting research priorities for so-called missions and industry partnerships. The member states said no.

The EU executive also requested more legal scope to support overt commercialisation in Horizon Europe. Here again, it hit a brick wall, with ministers vetoing the idea when they met last week.

“[The] meeting made it very clear who's deciding on content: EU governments,” tweeted Cornelis Vis, a senior economist in the Commission’s International Cooperation and Development division.

With about eight months to go until European elections, time is short and much is unresolved. The Commission and the Parliament are in a hurry, and this instantly puts them under pressure, said Peter Fisch, a former civil servant in the Commission’s DG Research.

That is because the talks are sound tracked by the ticking of an invisible clock counting down to the elections, when key personnel involved in research may be forced out. “The Commission wants to speed things up, while the European Parliament knows the game starts from zero again after the May elections,” Fisch said.

Member states, by comparison, face less immediate political pressure. “If you know the others are in a hurry and you are not, you can take some benefits from it,” Fisch added. “What could result is an advantageous deal for governments.”

Legal squabble

Getting an agreement to satisfy 28 governments on a huge programme covering countless research fields is never going to be straightforward.

But it is further complicated by the Commission’s request that Horizon Europe has a dual legal basis, authorising R&D funding under a Framework Programme - as is usual - and also invoking another treaty article more commonly used for industrial policy.

Under the second article, which the Commission wants to invoke for the for the first time, the  research directorate would get more power to invest in industrial development and commercialisation activities, through the European Institute of Innovation and Technology and a new body, the European Innovation Council (EIC).

It may be tempting to dismiss all this as tedious legal detail, but member states see it differently.

“The Commission seems to be confirming that [it is] seeking to stretch the limits of research with the EIT and EIC,” said Kurt Deketelaere, secretary-general of the League of European Research Universities. “It’s clear the Commission legal service knows they are creating risks with everything they plan to do on innovation in Pillar III of the programme.”

It was a surprise, even to some inside the Commission, that EU Research Commissioner Carlos Moedas made the request.

Several officials pointed out that the single legal basis for the current programme, Horizon 2020, already gives the Commission plenty of room to invest in industry-oriented projects. For instance, it allows the Commission to run the SME instrument, the precursor to the EIC, and to invest in market demonstrators.

Commission lawyers were concerned about the status of EIC and EIT, which was previously regulated outside the research programme. But officials say that the EU works – sometimes - by not following lawyers’ instructions to the letter.

Legal status aside, some states, including Italy and Spain, are not yet convinced by the plan to give €10 billion to the EIC, an untested instrument that is intended to replace a very popular programme, the SME Instrument. Some officials are worried that the EIC will benefit bigger companies, to the detriment of SMEs.

For whatever reason, ministers were against the idea of a wider legal scope. “The Council took a clear decision: the Horizon Europe specific programme is a research programme, not an industrial programme that also supports research,” said Heinz Fassmann, Austria’s science minister and the lead on negotiations for member states.

Commission negotiators have not entirely written off hope of bringing member states around to their way of thinking, but for the moment it is not clear what Plan B is. One Commission official described the impasse as “a significant worry”.

The rebuff from ministers last week was a blow to Moedas, who now finds himself in a tight spot, observers say. He has appealed to members states to park the issue for now, and get on with parallel talks on the content of Horizon Europe. Here, the commissioner emphasises, progress is being made.

The request to kick the can down the road is a staple in Brussels, but with the election clock ticking, the advantage will again be with the member states.

The fight within the fight

Other analysts see an entirely different motive behind member states’ move to block the Commission proposal, pointing out the dual legal basis would in theory grant the Parliament more power over research planning.

“If you were suspicious, you’d say this was really a game played between Parliament and Council, and the Council’s attempts to kick the Parliament out of decisions,” said Deketelaere.

This interpretation is disputed by some legal observers who question the compatibility of two legal bases that lay out different procedures for decision-making. However, Greg Arrowsmith, policy adviser with EUREC, the Association of European Renewable Energy Research Centres said, “I find the power struggle argument fairly plausible. It’s not like the Council was suddenly caught unawares by the EIC proposal, member states knew it was under planning for a long time.”

In the middle is the Commission, which has to decide whether to forge ahead with the dual legal proposal or to withdraw it, denying the Parliament more oversight of EU research. 

Blank cheque bounces

Analysts say the Commission made another misstep in requesting “a blank cheque” to set up industry partnerships and its bold plan for missions, which it is presenting as a new approach to objective-focused research.

“They may have overestimated their bargaining power here,” said one member state official. “The details presented [on partnerships and missions] in the legal text were kept foggy. It was never going to fly with governments, which battle to the last euro.”

Brussels funds 19 big industry-led partnerships focused on everything from drugs and planes, to trains and automobiles. The proposal for Horizon Europe calls for these partnerships to be rationalised, but as yet there has been no detail of where the axe might fall.

“The Commission had actually taken a courageous stance on partnerships because there’s always something new added to the programme, and hardly anything ever taken out,” said Fisch, speaking from 20 years’ experience managing EU research programmes.

The process of deciding which partnerships to kill will be messy and could affect which missions are chosen. If member states see their favourite partnerships culled, the temptation will be to try to replace them with missions.

“I’m afraid missions may not in the end be about the pursuit of the most intellectually interesting questions, but rather focused on areas that have enough political backing,” said Fisch.

The thought is alarming for some, who urge the Commission not to agree to governments’ demands. “Brussels’ job is to strip away national interests and make the best decisions it can for research,” one lobbyist said.

Late deal

Talks are due to resume on October 15, the start of a new intense phase, with Brussels hoping to squeak through an outline deal by the end of the year.

Many now expect negotiations to slip beyond the elections, limiting the time available to ratify the text ahead of the start of the new programme in 2021.

“I would have thought [a deal] before the elections is unachievable, knowing how long these things take to resolve,” Arrowsmith said.

Far right gains in the next election would create some difficulties. But not everyone is as concerned as the Commission and Parliament at the prospect of a late deal. “If you ask me who should decide on the new programme, it’s the people who come into power in 2019,” said Fisch.

Never miss an update from Science|Business

Newsletter sign-up