ECOFIN: Planned cuts to Horizon Europe must not be approved

While Commission President Ursula von der Leyen, the reports by Letta, Draghi and most recently by the Heitor Group focus on research and innovation as the key levers for strengthening European competitiveness, the European Council for ‘Finance and Economy’ (ECOFIN Council) is planning to significantly reduce the budget of the Framework Programme for Research and Innovation (Horizon Europe) for 2025.

After recently cancelling €2.1 billion of the 2021-2027 Horizon Europe budget and allocating it to other purposes, the finance and economy ministers of the member states want to withdraw a further €400 million for 2025. Among other things, the funds of the European Research Council (ERC) are to be cut by €70 million and those of the Industrial Partnerships and the European Innovation Council (EIC) by around €40 million each.

Research funding is an investment in the future

“We see this as a significant contradiction. On the one hand, all those involved have recognised that research and innovation are the key to significantly strengthening Europe’s dwindling competitiveness and global importance – especially in view of the ever-increasing need to catch up with the USA and China. On the other hand, if the Member States have their way, further cuts are to be made in this critical area of all areas,” said Council member Helga Nowotny, expressing her irritation. It should not be the case that the Member States use the funds from the framework programme to plug financial holes elsewhere — and at the expense of a globally competitive, sustainable Europe.

Any reduction in research funding is detrimental to Europe’s prosperity, growth and competitiveness in the long term.
Helga Nowotny

FORWIT therefore appeals to the federal government to refrain from agreeing to further budget cuts in the current framework programme. “Every cut in research funding is detrimental to Europe’s prosperity, growth and competitiveness in the long term. Research funding is an investment in the future,” emphasises Nowotny.

€429 billion added value through Horizon Europe 2020

Macroeconomic calculations based on the European Commission’s NEMESIS model show the enormous contribution that European research and innovation funding makes to the countries of the EU: The investments of the last Horizon 2020 framework programme led to an average annual increase in EU GDP of € 15.9 billion. Extrapolated up to 2040, this effect amounts to up to €429 billion. The cost-benefit ratio or multiplier therefore implies that every euro invested generates around five – in the confidence interval even up to eleven – euros in added value.