Horizon Europe budget to double, but €68B will remain in Competitiveness Fund

The proposal for the next Horizon Europe is in, with funding increases all round, including a tripling of the budget for the EU’s innovation scheme, the European Innovation Council (EIC).

The European Commission proposes to almost double Horizon Europe’s funding to €175 billion between 2028 and 2034, compared to the current programme. But a €68 billion chunk of the Pillar 2 budget, covering collaborative research, will be managed by the new European Competitiveness Fund (ECF).

And not all funding schemes will benefit equally. While funding for innovation will triple, collaborative research funding will grow only about a half.

Notable losers include the European Institute of Innovation and Technology (EIT), which fails to appear in the proposal, and the five Horizon Europe Missions, which are set to only receive funding until 2030.

These figures are only the Commission’s initial proposal for the next EU research programme. Member states, who will officially adopt the budget and foot the bill, have already said that the Commission wants too much. The European Parliament will also get a say in the negotiations over the final figures, and is calling for a bigger budget increase.

Here is what is on the table for Horizon Europe and the ECF, according to the Commission’s July 16 proposal.

Horizon Europe

Pillar 1: frontier research

The Commission wants the budget for fundamental research to go up from €25 million to €44 million, compared to the current Horizon Europe.

All this will go to the frontier research programme run by the European Research Council (ERC), and the researcher training schemes of the Marie Skłodowska-Curie Actions (MSCA). Meanwhile, €2.6 billion will be assigned to the Commission’s in-house science service, the Joint Research Council.

The breakdown between the ERC and the MSCA is not included in the proposal, but both are likely in for substantial increases. Their current budgets are €16 billion and €6.6 billion respectively, adding up to €22.6 billion, far below the proposed €44 million.

This is good news for the EU research community, which had called to double the budget of the ERC. Plus, the increase is set to come with a broader “expansion” of basic research funding, according to the proposal.

Pillar 2: collaborative research

The total budget for Pillar 2 will increase from €53.5 billion to €75.8 billion.

Under a new structure, funding for collaborative research will be separated into two parts, with €68.2 billion set aside for “competitiveness” and €7.6 billion for “society”.

The funding for competitiveness will be managed under the ECF and aligned with its for priorities: clean transition (€25.3 billion), life sciences (€19.6 billion), digital leadership (€16.8 billion), and resilience, security, defence and space (€6.4 billion).

The society policy window meanwhile will fund bottom-up research focused on global societal challenges such as migration, disinformation, democracy, social and economic transformations, inclusive societies and social cohesion.

Compared with the current Horizon Europe budget, the life sciences are in for a small boost and a revamp. Currently, the budget for health research stands at €8 billion, in addition to a separate €9 billion allocated to the bioeconomy, food, agriculture and other related topics.

Horizon’s current budget for civil security-related research is only €1.5 billion. The new pillar for resilience, security, defence and space is much broader but has significantly more firepower.

Clean transition is getting a clear boost, compared to the current €15 billion for climate, energy and mobility.

The new budget for digital leadership seems to be close to the current €15 billion for Horizon Europe’s digital, industry and space research cluster.

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Pillar 3: innovation

The budget for innovation will almost triple from €13.6 billion to €38.7 billion.

In the new Horizon Europe, this pillar will mainly fund the EIC, which provides grant and equity funding to start-ups and researcher-led innovation projects.

Launched in 2021, the EIC has been popular with start-ups and praised by policymakers. Its upcoming budget boost is hardly surprising.

Alongside the EIC, Pillar 3 will also fund innovation ecosystems and foster the EU-wide integration of the knowledge triangle of higher education, research and innovation, and business.

The knowledge triangle is a nod to the EIT. Although the innovation agency is not mentioned in the proposal, its mission is likely to continue in a new format. Its governing board proposed a revamped structure for EIT 2.0 before the Commission proposal was released on July 16.

The exact budget break down between the EIC and innovation ecosystems is not specified, but most of the money is likely to go to the EIC. This will be a major increase for the EIC, which has a budget of €10 billion in the current Horizon Europe.

Pillar 4: research policy

Finally, the pillar funding a common European research policy will have a budget of €16.2 billion, up from just €3.4 billion in the present research programme.

The increase is largely due to research infrastructures funding moving from Pillar 1 to Pillar 4, although it is unclear how much these will eventually receive. In the present programme, research infrastructures had €2.4 billion in funding.

The Widening programme supporting member states that are less active in EU research will also get a boost, from €3 billion to €5.3 billion.

Competitiveness Fund

The next Horizon Europe will be independent on paper, but a large chunk of its Pillar 2 budget will be managed by the new European Competitiveness Fund.

The ECF will have a total budget of €410 billion, including €175 billion for Horizon Europe and €234 billion for all other funding schemes.

The ECF has four priority areas:

Clean transition and industrial decarbonisation (€26.2 billion + €25.3 billion in Horizon Europe)

Health, biotechnology, agriculture and the bioeconomy (€20.4 billion + €19.6 billion in Horizon Europe)

Digital leadership (€51.5 billion + €16.8 billion in Horizon Europe)

Resilience and security, defence industry and space (€125.2 billion + €6.4 billion in Horizon Europe)

Another €11 billion will go to schemes that are not sector-specific, such as the InvestEU guarantee programme, project advisory, SME collaboration and skills development.