Council take the lead in Horizon Europe negotiations

25 October, Brussels - Horizon Europe appears to be in legislative deadlock, with major debates on the legal basis of the programme, and as a result, who will set funding priorities. The proposals are making their way through the legislative process, but there is concern over whether the proposals will be finalised in time before the European Elections of May 2019.

Surprisingly, establishing the legal basis for Horizon Europe is proving to be one of the major contentious issues between the Commission and Parliament on the one side, and the Member State Governments on the other.

When legislation is proposed, the Commission must cite its legal basis from the EU treaties. Articles 182 and 183 of the Treaty on the Functioning of the European Union give the legal basis for the establishment of Framework Programmes and Rules of Participation, but for Horizon Europe, the Commission also cited Article 173, which states the Union will support “fostering better exploitation of the industrial potential of policies of innovation, research and technological development.”

This seemingly innocuous inclusion has sparked a heated debate between the Commission and the Member States. The inclusion of Article 173 was intended to allow the EU to support industrial development and commercialisation activities through the European Institute of Innovation and Technology and the new European Innovation Council, but Member States have seen it as a power grab, giving the Commission and European Parliament greater power in setting funding priorities, as the two different legal bases would entail having two different decision-making processes.

National Research Ministers have argued that the Article 182-183 basis provides ample coverage for funding near-market projects, such as the current SME Instrument in Horizon 2020, and the other European Innovation Council pilot actions. “The Council took a clear decision: the Horizon Europe specific programme is a research programme, not an industrial programme that also supports research,” said a representative of the Austrian EU Presidency.

For now, negotiators have agreed to delay making a decision, and have instead moved onto other issues, but the argument feeds into the key issue of who sets priorities; the Commission, the EP or the Council. The Horizon Europe proposals set broad parameters for research missions and partnerships which would have left the Commission to fill in details later, as priorities emerged and changed. However, the Member States have not been willing to hand over such responsibilities, fearing that national priorities and national champions could end up losing out.

The Commission’s proposals for the industrial partnerships – such as Clean Sky, Factories of the Future (FoF) and Sustainable Process Industry (SPIRE) – would have seen some partnerships being cut, or merged together. However, it never specified which would disappear, and the Member States have taken it upon themselves to already define an initial list of such partnerships, which they may try to introduce into the legal text. The new industrial partnerships already being briefed include:

  • Health innovation, for the rapid development, deployment and safe use of medical treatments, devices and technologies enhanced by digital technologies;
  • Global health, including links to national health research systems and philanthropic funding;
  • Key digital technologies, including novel technologies such as AI and linking to downstream sectors;
  • Metrology, to develop new tools for the speed, accuracy and cost of measurement;
  • Air traffic management, including new tools and technologies for flexible use of airspace (including for novel avionics, drones);
  • Aviation, to reduce CO2 emissions and noise, including through electric or other alternative propulsion systems;
  • Rail, including transformative change in rail through automation and digitisation;
  • Bio-based solutions, including CO2 uptake technologies for food and energy; biomass; and maritime resources;
  • Fuel cells and hydrogen energy storage technologies;
  • Connected, autonomous mobility.

The argument over priority setting has also spilled over to the proposed research missions, aiming to direct research towards solving a number of large societal problems. National science ministers are currently steering towards having an initial five research missions, being briefed as:

  • To build the first universal quantum computer in Europe (Digitalisation)
  • To cure paediatric cancer (Health)
  • To eliminate plastic waste in rivers and seas (‘Clean Europe’)
  • To create the first carbon-neutral cities with clean air (‘Clean Europe’)
  • To restore soil health (Food and Agriculture)

These missions are each expected to gain around €1-2 billion each over the course of the programme, whilst partnership will receive up to 40% of the total budget. Whilst the Commission proposed a budget for the programme of €97.6 billion, the Environment, Research and Industry (ITRE) Committee of the European Parliament is pushing for up to €120 billion.

The committee has also considered a proposed amendment to the draft legislation to require regional quotas for the research budget, in a bid to overcome the large divide between research incomes between the newer member states (EU13) and the older members (EU15). Such an approach does not seem to have the support of MEPs, and the European Commission has pushed back against it, arguing that excellence should be the main criteria for how the funds are spent

The Committee has already issued its draft reports on both the Framework Programme and the Specific Programme, though neither has been formally adopted by the Committee. Once the Committee has finalised its opinion, it will go for vote in full plenary. The Member States, in the Council, will then need to respond. With elections to the European Parliament coming up in May, followed by the appointment of a new European Commission, time is tight to reach a deal. Some analysts believe that the Member States are being particularly obstructive as part of a power struggle, knowing that both the Commission and Parliament have tight deadlines to meet, whilst they have longer to mull over the details.

Failure to complete negotiations before the elections could result in a delay to the expected beginning of the programme, on 1 January 2021. It seems likely that unless the EP capitulates to the Commission’s demands, then the legislation will not be finalised until after the European elections. New power dynamics in the new Parliament, and the loss of some key legislators may hand more power to the Council to push through its vision unopposed.

Complicating matters further is the issue of UK access to the programme. As the UK creeps closer to a no deal scenario, a cliff edge Brexit could also contribute to delays in the beginning of the programme.