EU Council and Parliament strike a deal on Horizon research programme

In the early hours of the morning on 20 March, negotiators for the European Parliament and the EU Council struck a deal on Horizon Europe, the EU’s next research funding programme, improving chances that the European Commission will be able implement it on time in 2021.

The partial agreement confirms much of the programme, but not its budget or the involvement of non-EU countries, which will be tackled later. The new draft legal text, seen by Science|Business, gives Horizon Europe a new section dedicated solely to the cultural sector, confirms the themes for industry partnerships and focused research “missions,” and tweaks the European Innovation Council, the new technology commercialisation body.

If MEPs and member states vote to approve the agreement in the coming weeks, the commission can begin preparations to ensure Horizon Europe starts as soon as Horizon 2020, the current research programme, winds up at the end of next year. Besides reducing the risk of an interruption in research funding in 2021, the agreement also provides a much clearer picture of what Horizon Europe is going to look like.

Horizon Europe, the ninth R&D programme, will run from 2021 – 2027. The commission has proposed a budget of €94.1 billion for the programme, while the parliament wants €120 billion. The amount won’t be agreed until the end of 2019 at the earliest, because it depends on negotiations for the EU’s long-term financial plan.

Crisis averted

Although Horizon Europe isn’t due to begin until 2021, the commission needs time to draw up plans for its implementation and recruit members to the various boards that help assess funding applications. To do that, the commission needs some clarity from legislators now about what will be in the programme.

The agreement shows “that the institutions are able to deliver in a short time,” said Christian Ehler MEP, one of the parliament’s Horizon rapporteurs, in an interview. “We should be aware that time is precious, and we are living in times of global competition where stakeholders are no longer just Europeans. They can easily go to the United States or to China” and they will not wait for “complex political decision processes,” said Ehler.

Weeks of deadlock over Horizon Europe stoked fears that the programme might be delayed, because the entire parliament still has to vote on any deal before it breaks up for the May elections. MEPs elected in May won’t take their seats until early July, meaning failure to strike a deal now would have put negotiations on ice for at least two months.

Support for cultural and creative industries

The agreement gives Horizon Europe a new culture and creative section, officially called a cluster, which will be dedicated to boosting R&D in Europe’s cultural industry.

“[This] is one of the biggest sectors in the European economy,” said Ehler, a German conservative. “We created a complete new instrument, a research collaboration space for museums and cultural heritage. We should not let American platforms get a grip of our digital content.”

Ehler said the cluster was about more than just supporting the arts – he gave the example of a company that had made it easier to treat children with lung diseases by integrating lung testing machines with a video game.

The commission’s original proposal had a cluster called “inclusive and secure society.” The council’s version, adopted in November, renamed it “culture and inclusive society,” while the parliament in December made a similar change, but split the cluster in two: “inclusive and creative society” and “secure society.”

A gentleman’s agreement

The deal also puts an end to complicated legal wrangling over precisely how the legislation should be rooted in the EU treaties, as all EU law must be. The settlement sees the parliament give up its right to veto the strategic planning of Horizon Europe. In exchange, it gets greater control over the themes for research partnerships and the missions, which will fund research in a few high priority areas like cancer and water pollution.

The legal problem boiled down to whether the parliament would get a vote on the so-called Specific Programme, which is the part of Horizon Europe that lays out the details of its various elements, or whether the council would have full control.

The other part of Horizon Europe is the Framework Programme, which sets out its overall structure and carves up the budget. The Framework Programme was always going to go a vote in the Parliament regardless.

In what Ehler, the parliament’s rapporteur for the Specific Programme, called a “gentleman’s agreement,” MEPs offered to relinquish direct control over the Specific Programme in exchange for concessions from the council. To sweeten the deal, MEPs also offered council the exclusive right to approve Horizon Europe’s strategic planning, which the commission will draft.

Since the parliament can block the Framework Programme anyway, the council was forced to take the offer and negotiate changes to both parts of Horizon Europe – even though its official position was that the talks were only about the Framework Programme.

Ehler said the matter of strategic planning “was more about technical questions than really a political fight.” The parliament wanted to make sure that the mission areas would be defined in the legislation, and was content to leave matters of strategic planning to the commission and the council.

Mission and partnership areas confirmed

An important concession the council made was to shift the themes for missions and partnerships from the Specific Programme to the Framework Programme. That means both MEPs and member states will vote on exactly the same list of mission and partnership areas in the coming weeks. That gives the commission just enough clarity to begin recruiting the missions’ advisory boards and planning the partnerships.

The negotiators agreed five mission areas and eight partnership areas. The missions themselves and the various public-private and intergovernmental partnerships will be finalised by the commission in strategic planning, before being submitted to the council for approval. The number of missions will be small, but there may be more than one per mission area. There will almost certainly be dozens of partnerships.

The five mission areas are:

1. Adapting to climate change, including societal transformation
2. Cancer
3. Healthy oceans, seas, coastal and inland waters
4. Climate-neutral and smart cities
5. Soil health and food

The eight partnership areas are:

1. Faster development and safer use of health innovations for European patients, and global health.
2. Advancing key digital and enabling technologies and their use, including but not limited to novel technologies such as artificial intelligence, photonics and quantum technologies.
3. European leadership in metrology, including an integrated metrology system.
4. Accelerate competitiveness, safety and environmental performance of EU air traffic, aviation and rail.
5. Sustainable, inclusive and circular bio-based solutions.
6. Hydrogen and sustainable energy storage technologies with lower environmental footprint and less energy-intensive production.
7. Clean, connected, cooperative, autonomous and automated solutions for future mobility demands of people and goods.
8. Innovative and R&D intensive small and medium-sized enterprises.

Changes to the European Innovation Council

The deal also tweaks the European Innovation Council (EIC), the flagship new funding agency set up by research commissioner Carlos Moedas.

One part of the EIC, the Accelerator, is intended to support innovation in small and medium sized enterprises (SMEs) through a mix of grants and equity investment. It replaces an existing component of Horizon 2020, the SME Instrument, which focuses on grants. Moedas announced a pilot for the Accelerator on 18 March. 

MEPs wanted to preserve the SME Instrument’s functions by ringfencing 40 per cent of the EIC Accelerator’s budget for grants only. But that didn’t happen. Instead, the two sides agreed to change the remit of the Accelerator from providing “blended finance” to awarding “two types of support: mainly blended finance […] as well as grants, optionally followed by equity investment.”

The negotiating teams also agreed that the EIC Accelerator should spend at least as much on grant-only support as Horizon 2020’s SME Instrument.

No pay rise for researchers in Eastern Europe

MEPs were unable to persuade the council that Horizon Europe should pay researchers in poorer countries an additional 25 per cent on top of all personnel costs funded through the programme. While that would help to narrow the earnings gap between member states, it would also increase pay disparities among researchers within the beneficiary countries.

The idea arose from the difficult question of how best to promote both excellence and widening, to support Europe’s finest researchers at the same time as improving research infrastructure in poorer member states. Rich countries with better-funded institutions tend to attract the top researchers and perform better in competitive bids for EU research grants, making it harder for poorer member states to catch up.

More money for widening

Instead, negotiators agreed to a recital saying that 3.3 per cent of Horizon Europe’s budget should support efforts to widen participation. The commission had proposed €1.7 billion for widening, or 1.8 per cent of the proposed budget, whereas the parliament wanted 4 per cent. Horizon 2020 has a widening budget of about €800 million, which is about 1 per cent of the budget.

Widening measures under Horizon Europe will be similar to those in Horizon 2020, such as helping universities in widening countries to partner with wealthier institutions elsewhere when applying for grants.

But today’s deal adds new measures, such as advance checking of grant applications so institutions in widening countries have a chance to improve them, and a “hop-on” provision whereby winning research consortia can secure additional funding if institutions in widening countries join them at a later date.

There are 15 widening countries. In Horizon 2020, these are the “EU13” that joined after 2004 – 11 post-communist countries plus Malta and Cyprus – as well as Portugal and Luxembourg, even though the latter has the highest GDP per capita in the EU.

Despite its wealth, Luxembourg has performed poorly in EU research programmes, and its sole university only opened its doors in 2003. “Luxembourg was a little bit of a statistical failure,” said Ehler, alluding to the formula used to select widening countries. “If you get to very small countries, you could, statistically, get into a situation where you get someone on board that might not be, in principal terms, what you had tried to address.”

Negotiators agreed that in Horizon Europe, the widening countries will be determined by a footnote to the legislation itself, instead of by commission policy at the implementation stage. The widening countries in Horizon Europe will be the EU13, Portugal, and Greece – not Luxembourg.

The idea behind establishing the widening countries in the legislation, said Ehler, was to ensure the list did not change over the seven-year life of Horizon Europe. But he said that question “is not perfectly answered, because it’s in a footnote. If it were in an article or an annex, that would be really part of the legislation.” Footnotes, said Ehler, have relatively little legal weight.

Still a long way to go

This deal still has to be approved by the whole parliament and the member states, because it was brokered by the parliament’s rapporteurs – Ehler and Dan Nica, a Romanian social democrat – and the council’s presidency, currently held by Romania.

The parliament votes on the agreement in April: its research committee’s next meeting is scheduled for 1-2 April, and its final plenary meeting before the elections is two weeks later.

After that, there will still be a long way to go before Horizon Europe is set in stone. The budget, and the terms for non-EU countries that want to participate, can’t be finalised until member states reach a unanimous agreement on the EU’s next long-term financial plan. That is unlikely to happen before the end of the year, at the earliest.