First shot across the bow in Horizon 2020 funding battle

The European Parliament is demanding "significant increases" in funding for research and innovation in the EU budget for 2014-2020. A resolution adopted by a large majority of MEPs on Tuesday (23 October) stressed, “the need to enhance, stimulate and secure the financing of research and innovation” in the next R&D programme, Horizon 2020.

In the resolution on the EU’s 2014-2020 budget, MEPs warned Member States, “against any attempt to reduce further the level of EU expenditure,” at the same time underlining the critical role of research and innovation in accelerating, “the transition towards a sustainable, world-leading, knowledge-based economy.”

MEPs challenged the Council, “to clearly and publicly identify which of its political priorities or projects should be dropped altogether,” in the case that it advocates cuts. So far, the stance of Member States to the proposed Horizon 2020 budget is unclear, but the suspicion is that ministers will try to prune back the Commission’s suggested €80 billion plan.

However, some Member States that want to cut the overall long-term budget – of €1 trillion - support the increase in R&D spending – from €50 billion in Framework Programme 7 to €80 billion in Horizon 2020. 

More clarity on the exact position of Member States is expected after a special summit scheduled for the second half on November.

A time of exceptional fiscal discipline

The Multiannual Financial Framework (MFF) sets out the budget for individual EU policy areas and the overall total expenditure. The framework will be drafted and adopted by EU finance ministers, directed by their bosses in the European Council, but can be vetoed by the European Parliament.

This is a time of exceptional fiscal discipline when it is also, “essential to reflect the consolidation efforts being made by Member States,” said Andreas Mavroyiannis, permanent representative to the EU for Cyprus, the country currently holding the presidency of the Council of Ministers.

The focus on austerity by the national governments, “stifles measures aimed at providing economic growth and prosperity” warned the European Parliament's chief negotiator for the MFF, Reimer Böge MEP (EPP-DE).

Large-scale projects

In the resolution, MEPs say that the budget for large-scale infrastructure projects such as the international nuclear fusion reactor in France (ITER), Europe’s Global Positioning System Galileo and the Earth observation project GMES should be, “ring-fenced, so as to ensure that possible cost overruns do not threaten the funding and successful implementation of other Union policies.” In other words, these projects should not be funded out of the Horizon 2020 budget.

In the MFF resolution MEPs also rejected any attempt to lift GMES out of the EU’s purview and turn it into an intergovernmental programme, citing, “the strategic importance of large-scale infrastructure projects [..] for the future of the EU’s competitiveness.”

A sustainable economy

MEPs also stood up for Europe’s legions of small companies saying, “SMEs are key drivers of economic growth, competitiveness, innovation and employment,” and have an important role in ensuring recovery and “boosting a sustainable EU economy.”

There should be no attempt to cut funding for programmes such as the Commission’s new  €2.5 billion Programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME), that are ”at the heart of European competitiveness and employment.”

Midterm review

The resolution calls for a mid-term review to be enshrined in the MFF legislation, potentially opening up the possibility of adapting the Horizon 2020 spending levels to new economic realities halfway through the 2014-2020 budget period.

And MEPs reminded Member States they have committed to spending 3 per cent of GDP on R&D, pointing to, “the massive economic commitment that this target would entail,” which is estimated to be €130 billion per year.

Negotiations

EU heads of state and government will discuss the MFF at a special budget summit on 22 and 23 November. Should they reach an agreement, the Council of Ministers will have a mandate to negotiate the final shape of the MFF with the European Parliament.

In this week’s resolution, MEPs insist that after the European Council has reached a political agreement, “fully-fledged negotiations between Parliament and the Council need to take place” before the Council  formally submits its MFF proposal to the European Parliament for MEPs’ consent.

MEPs noted  the EU budget is only some 2 per cent of total government expenditure in the EU and is therefore, “more than 45 times smaller than the sum of government expenditure in the Member States,” a statement that is intended to counter claims of national politicians about exorbitant spending at EU level.

"The European Parliament will get the final say on the next multi-annual budget framework. The plenary will have to approve the Council proposal by qualified majority,” Böge said.