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The consequences of the Horizon Europe budget reduction

The COVID-19 health crisis hit Europe suddenly and severely. A Europe which, in order to rebuild itself, voted an economic recovery plan of 750 billion euros, resulting in the cutting of several European programmes including Horizon Europe.

Horizon Europe: A reduced budget

On 23 July 2020, the European Parliament approved a European economic recovery plan with a budget of 750 billion euros. Horizon Europe, the framework programme for research and innovation (2021-2027), has had its budget decreased from 94 billion euros to 84.9 billion euros, a cut of 10 billion euros.

On 10th of November 2020, when Horizon Europe's budget was set at 80.9 billion euros, and after tough negotiations, the European Parliament and the European Council finally increased this budget by 4 billion euros. It is now a matter of deciding how the budget will be distributed between the different areas of the programme, on how it could be used in coordination with other EU funding sources and on which countries outside the Union will be allowed to participate.

ARTTIC European leader in consultancy and management services for Research and Technological Development

However, Horizon Europe is not the only framework programme to have revised its budget downwards because the investment programme InvestEU, the European defence funds, ERASMUS and EU4Health have also had a truncated budget.

The consequences for the Research and Innovation

Among the sectors most affected by this decrease are health and climate initiatives. Two sectors that were considered to be priority areas during the implementation of the framework programme. These sectors are part of the second pillar "Global Issues and European Industrial Competitiveness" which has a budget of more than 47 billion euros, i.e. more than half of the total budget of Horizon Europe. We do not know, for the moment, which themes will be highlighted by these sectors. Nevertheless, will this be enough to face the societal challenges and strengthen Europe's competitiveness?

ARTTIC European leader in consultancy and management services for Research and Technological Development

The budget of the Horizon 2020 framework programme (2014-2020) was 79 billion euros. With this cutting, the new European Horizon Europe Framework Programme has "only" slightly less than 2 billion euros of additional budget than its predecessor, although its visions are much more ambitious.

A reduced budget and a "post-pandemic" atmosphere could have serious consequences when Horizon Europe will be launched in 2021:

  • A framework programme that might not live up to the ambitious objectives it proposes (sustainable development, artificial intelligence, new health policies...).
  • A concern for SMEs, due to increased competitiveness between EU countries in hopes of being funded
  • An impact on the willingness of European and third countries to contribute financially

The first drafts of the work programmes and public consultation were published in September 2020. Subject to the adoption of the new 2021-2027 budget, the first calls for proposals should be published in the first half of 2021.

And the United Kingdom in all this...

Although there’s still uncertainty about numerous aspects of Brexit, the United Kingdom will no longer be part of the European Union in 2021. While negotiations are dragging on for a future trade agreement, both London and Brussels want the United Kingdom to be part of the Horizon Europe adventure, without agreeing on its role within the framework programme.

PNO Consultants France and ARTTIC have joined forces to deliver services covering the complete innovation cycle, from strategy to implementation, while maximising technical and sectoral complementarities. An unrivalled expertise, attested by over 120 successful Horizon 2020 proposals in the transport, health, security, energy, food and bioeconomy fields; three decades of experience serving a portfolio of 400 clients; and a strong European presence through our offices in Paris, Toulouse, Derby (UK) and Brussels make PNO Consultants France and ARTTIC sound partners to advise your organisation in the financing, set-up and management of research and innovation projects.

Nathalie Authelet-de Fleury, PNO Consultants France

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