FZO 2025: Strategic course-setting for AI, top-level research and international talent

With an application volume of nearly €280 million, demand for funding in 2025 significantly exceeded the available budget. The Future Austria Fund (Fonds Zukunft Österreich, FZO) can therefore only support a portion of the submitted projects – overall, FORWIT recommends funding 11 initiatives with a volume of around €140 million. Focus areas include the new AI Factory ‘AI:AT’, programmes for attracting international top talent, and strengthening excellently rated but previously unfunded research projects. At the same time, the Council emphasises the necessity of long-term security for the FZO with the €200 million per year also planned by the federal government and suggests examining alternative funding sources.

Recommendation for Fund Allocation 2025: AI Factory, International Talent and Excellence

In total, eligible funding organisations submitted 19 applications with a volume of €279.5 million – representing an increase of around 40% compared to the previous year. Following a thorough evaluation of the applications, the Council recommends funding four projects under the priority area “Competitiveness and Key Technologies” with €72 million, four under the priority area “Collaborations and European Participations” with €38 million, and three under the priority area “Talents and Skilled Personnel” with €30 million.

€40 million – a considerable share of the funding – goes to the AI Factory ‘AI:AT’, affecting the entire distribution of FZO funds for 2025.
Thomas Henzinger

€40 million – a considerable share of the funding – goes to the AI Factory ‘AI:AT’, which was only approved by the European Commission in March, affecting the entire distribution of FZO funds for 2025, as Council chairman Thomas Henzinger notes. “However, we also consider it essential for Austrian competitiveness and innovation capacity to rapidly cover a wide range of much needed and time-critical services in the AI sector through the AI Factory and its planned services – such as expanding AI infrastructure, community support and training.”

Two projects from FWF and ÖAW are intended to contribute to attracting international researchers and talent. The aim is to target not only researchers working in the USA, but particularly those who had considered the USA as their career destination but are now seeking alternatives due to developments there.

FORWIT considers the FFG’s ‘Seal of Excellence’ programme an efficient and effective contribution to promoting Austrian top-level research. This enables research projects to be carried out that were assessed as excellent by the ERC or EIC Accelerator but were not funded due to lack of resources. The effort for screening, assessment and selection is largely eliminated and outstanding projects can thus start more quickly. However, in order for the programme to be carried out in compliance with the law, the necessary amendments to the FFG funding guidelines must be implemented in good time.

Examining Alternative Options for Long-term Financing of FZO

In its recommendation, FORWIT emphasises that all proposed initiatives possess the potential to make an important contribution to strengthening Austria’s research and innovation system. However, due to the fixed funding budget of €140 million, strategic prioritisation of the initiatives was unavoidable.

“The quality and scope of applications show that there are far more projects worthy of funding than can currently be financed.”
Sonja Sheikh

“The quality and scope of applications show that there are far more projects worthy of funding than can currently be financed. In the interest of the future viability of the Austrian STI system, it is therefore all the more important to secure the FZO long-term with appropriate funds – as set out by the federal government in its programme,” confirms Sonja Sheikh, Council member and chairwoman of the FZO working group in FORWIT. That only €50 million is budgeted for 2026 due to the extremely challenging budget situation is fiscally understandable, but has implications for the programme portfolios of the funding agencies and thus also for research and researchers in Austria.

“The goal must be to distribute €200 million annually through the FZO from 2026 onwards.”
Thomas Henzinger

From the Council’s perspective, alternative financing options should therefore be examined. FORWIT suggests, for example, dedicating funds from dividend distributions of the Austrian Holding Company (ÖBAG) to the Future Austria Fund in future and making donations to the National Foundation, which administers the FZO, tax-deductible. “The goal must be to distribute €200 million annually through the FZO from 2026 onwards as an essential instrument of Austrian STI policy for promoting Austria’s future competitiveness,” Thomas Henzinger confirms.

The complete details and justifications for the recommended fund allocation can be found in FORWIT’s recommendation published today.