Leaked EU competitiveness plan prompts concerns over ERC independence

A leaked EU competitiveness strategy is prompting fears that Brussels intends to undermine the independence of the European Research Council (ERC) by pushing for more alignment with the European Innovation Council (EIC) and the EU’s broader political goals in the development of advanced technologies.

The European Commission, which will present its Competitiveness Compass later this week, also backs calls to reshape the EIC in the image of the US Advanced Research Projects Agencies (ARPAs), according to the draft proposal seen by Science|Business.

Through the Competitiveness Compass, the Commission hopes to “rekindle productivity based on innovation,” in response to former Italian Prime Minister Mario Draghi’s landmark report, which identified the innovation gap between the EU and the US as the primary reason for lagging growth in Europe.

In the context of plans to boost industrial uses of artificial intelligence, the draft proposal states that “the European Research Council and the European Innovation Council need to be aligned along the same strategic interests and cooperate more closely to achieve results.”

In contrast to the rest of Horizon Europe, where the Commission and member states set the agenda, ERC grants for basic research are managed by an independent scientific council.

“The ERC must continue to pursue its mission, free from any imposed alignment along political priorities,” said ERC president Maria Leptin. “The philosophy of the ERC rests on the idea that researchers know best the most promising research areas to explore without predetermined themes or priorities and that the ERC is independent in its strategies and their implementation.”

Leptin is not jumping to conclusions based on the brief reference in the draft, and notes that the ERC and EIC already have “good cooperation.” However, she warns that, “if ‘aligning with strategic interests’ were to mean that the ERC should be restricted to funding specific topics, then we would be very concerned.”

Overall, the ERC scientific council is “delighted” by the consensus in the Commission that EU competitiveness needs to be boosted, Leptin said. However, she added that “Draghi was very clear about the importance of maintaining the ERC in its current form.”

More money, less autonomy

The latest plans suggest “a clear distrust for the bottom-up, undirected approach of research and innovation,” said Kurt Deketelaere, secretary general of the League of European Research Universities. “It confirms what I always feared: potentially more money for the ERC in return for less autonomy.”

The ERC’s independence is vital to its mission, said Jan Palmowski, secretary general of the Guild of European Research-Intensive Universities. “It is only by funding cutting-edge science that the ERC can be truly open to new ideas that nobody else is thinking about.” Cutting-edge science, he went on, cannot be decided by politicians or political strategy. “It can only be evaluated by scientists.”

The ERC and EIC should be encouraged to collaborate more in the future, so that ERC-funded research can be scaled up into innovation, Palmowski added. “But the formulation of the Competitiveness Compass not only compromises the independence and mission of the ERC, it undermines what the ERC and EIC do best.”

The ERC’s scientific council has pushed back against previous attempts to impose more top-down decision-making. This led to the dramatic resignation of its last president, Mauro Ferrari, in 2020, after he tried and failed to convince the council to establish a special research programme alongside the Commission to combat the COVID-19 pandemic.

While the ERC faces pressure to focus more on political priorities, the EIC could be in line for more independence. “The successor to the EIC should be structured like an ARPA-type agency for increased risk taking,” the plans state, referencing one of Draghi’s key recommendations.

The EIC is too dependent on Commission officials, Draghi wrote, whereas the ARPAs provide expert programme managers with huge leeway and budgets to pursue radical innovations. The most famous of these, DARPA, funds defence research and has played a leading role in developing technologies such as the internet and GPS.

Competitiveness fund

While Commission President Ursula von der Leyen has called for the ERC to be expanded, there is a growing focus on translating research into innovation.

“The future EU research budget, with a more strategic and less bureaucratic approach to supporting the transition from applied research to the scale-up phase, will provide targeted support to industrial competitiveness,” the proposal reads.

The research community has previously expressed concerns over internal Commission documents proposing to bundle most EU research programmes into a mega competitiveness fund, including Horizon Europe’s successor, FP10.

In the next long-term budget period from 2028, the Commission wants to “rethink the structure and allocation of the EU budget in support of competitiveness priorities,” with fewer programmes and more strategic coordination, the Competitiveness Compass says.

While there is no specific mention of FP10, a European Competitiveness Fund is planned to finance investments in strategic technologies, and to “leverage and de-risk private investments and support R&D.”

According to Deketelaere, this is bad news for those expecting a standalone FP10 with a ringfenced budget. “The drafters of this document clearly aim for a European Competitiveness Fund as a kind of super flexible budget bazooka which the European Commission will be able to use for what politically is seen urgent and important,” he said.

This approach will undermine research and innovation policy, Deketelaere went on. “It will remind us of what we have seen over the past years: if there is a new challenge, and money is needed, it is taken from research.”

Others are concerned that the contribution of research and innovation to Europe’s future is being reduced to questions of economic competitiveness. “Some of the key EU goals are totally missing from this silo approach: solidarity, social cohesion, equity, inclusion,” said Emmanuelle Gardan, director of the Coimbra group of universities.

Moreover, the document addresses innovation through the narrow lens of technology. “We find it worrying that the role of the humanities is not mentioned at all,” Gardan added.

She also regrets that basic research and education are largely absent from the proposal. “It is quite striking and disappointing that such a document has been developed without any prior consultation.”

Palmowski is equally concerned that the plans do not acknowledge the role of basic research in instigating breakthrough ideas. “The Competitiveness Compass ignores the added value of the entire research pipeline from fundamental to applied research at its peril,” he said.

Innovation gap 

The draft Competitiveness Compass is also concerned with the innovation gap between the EU and its main rivals, the US and China. “For over two decades, Europe’s economic growth has not kept pace with other major economies,” it says. “The convergence between the EU and the US on innovation has slowed down, while China has caught up.”

As an example the Commission points to the EU’s share of global patents. Although it is comparable to the US and China, only a third of them are commercially exploited, reflecting the difficulties that researchers and entrepreneurs face in marketing their finds.

To address this discrepancy, it promises to “act on all aspects of the innovation lifecycle.” In 2026, the Commission will propose setting up a 28th regime to simplify rules in areas including “insolvency, labour law, and tax law” and to make it easier for companies to grow across the bloc.

Brussels will work on boosting venture capital as part of a Savings and Investment Union to be presented in the second quarter of 2025, and an EU Start-up and Scale-up Strategy, which will also address “relations between universities and business.”

On defence, “an important driver of competitiveness in its own right,” the Commission emphasises the need for heightened cooperation between member states by increasingly resorting to joint procurement, joint R&D, and pooling resources through Defence Projects of Common European Interest.

“Low investment in defence R&D entails the risk for the EU to fall behind in defence innovation,” it notes.

Critical technologies

A further plan involves the European Investment Bank deploying a TechEU investment programme to support innovative technology projects, as the EU looks “to reap the productivity gains” in key technology sectors such as artificial intelligence, robotics, clean energy, space and quantum.

The Commission will come forward with acts on advanced materials, space, biotech, and quantum, while a Digital Networks Act is on the table to facilitate digitalisation and AI integration across all sectors.

In addition to its Clean Industrial Deal and Affordable Energy Action Plan, the EU executive arm plans on rewarding European companies that choose to take the lead in decarbonising the EU with measures to encourage demand for low-carbon products. Meanwhile, a Circular Economy Act proposal is expected to catalyse investments in reusing and recycling materials.

But being competitive is only possible if Europe ensures its economic security, the Compass says.

If trade partnerships are essential to its prosperity, the 27-member bloc must also address the challenges linked to unfair competition and minimise a potential weaponisation of dependencies on single or highly concentrated suppliers, like that for critical raw materials.

“A policy combining promotion of domestic production, stockpiling and diversification must be pursued,” the proposal explains.

As a result, the Commission intends to create a platform for the joint purchase of such materials and propose the introduction of a European preference in public procurement for critical sectors and technologies.

Simplification and coordination

Ekaterina Zaharieva, the new research commissioner, has been underlining the importance of cutting overbearing regulations surrounding the research and innovation field, as they constitute a major obstacle to long-term investment.

This is reiterated in the draft Competition Compass, which says that “regulation must be proportionate, stable, coherent and technology neutral. Accessing EU funds or obtaining administrative decisions must become faster and cheaper.”

Calling for “a regulatory system based on trust and incentives rather than detailed control,” the document hopes that discussions on the next Multiannual Financial Framework will result in streamlined access to EU funding instruments.

In the meantime, the Commission will next month put forward a first Simplification Omnibus to modify several existing regulations at once, focusing on sustainable finance reporting, sustainability due diligence and taxonomy. It will also propose a new definition of small mid-caps, which should enable up to 31,000 companies in the EU to benefit from tailored regulatory simplification, just like SMEs.

Simplification also implies a reduction of reporting burdens, hence the targeted 25% cut in reporting obligations for firms and 35% for SMEs.

To better coordinate EU and national objectives, the Commission will propose a new Competitiveness Coordination Tool, which will focus on national milestones. It wants to begin by coordinating EU and national policies in a few pilot cases, which could include energy infrastructure and AI vertical use cases.

Science|Business is keeping the full history of the drafting process publicly available in our Horizon Papers database. We think it is important to maintain a public record of how the programme evolves, in successive rounds of drafting between the Commission and member states. It is a political process – which, so far, the Commission refuses to make transparent. You can share anonymously other draft work programmes at [email protected].