Did the Commission drop the ball on FP10?
Last week was all about FP10, and what a week it was.
Leading MEPs in the ITRE committee had not one but two intense hearings on FP10 and ECF. And on Thursday and Friday, research ministers met in the Competitiveness Council to discuss ECF and FP10.
Although the timing was coincidental, last week was among the most influential in the run-up to FP10.
It also revealed an obstacle in the negotiations: absent a Commission plan to implement FP10, Parliament and Council are considering their options.
I think there are two (sound) reasons for their scepticism, but let’s take a moment first to consider how FP10 is shaping up in each institution.
Contours of FP10
Clearly, there is agreement on the fundamentals.
Horizon Europe should remain focused on supporting excellent research and innovation. There is support for the primary workstreams of ERC, collaborative research, and EIC. And 175 billion euros is nice, but not double the budget that Draghi, Letta, and Heitor had required.
For more details on the discussions, there is excellent coverage from Science Business, Research Professional, and, for those who speak Dutch, our own website.
However, last week also made it clear that an agreement is far away.
Principal-agent
Parliament and Council are concerned. Absent a Commission plan for pillar 2, how are we going to implement the programme?
This strikes me as a textbook principal-agent dilemma, in which the principals do not fully trust the agent to act in their best interests.
That is problematic, because the Commission’s pitch for overhauling FP10 and ECF was essentially: “let us handle it”.
A bigger budget, briefer legal text, larger work programmes, less involvement of member states, and larger projects—the Commission essentially made a plea for flexibility in the name of safeguarding Europe’s competitiveness.
But that plea is undermined by the seeming lack of trust from Parliament and Council.
I think there are two good reasons for that.
Trust busters
First, over the past seven months, the Commission’s conduct did not particularly inspire confidence.
In February last year, the Commission announced a competitiveness coordination tool to steer the programmes. When FP10 was proposed in July, the tool was expected in November. It was then postponed to January, only to fall off the table completely. In the meantime, questions from Parliament and Council received muddled answers.
It is no wonder then that research ministers dwelt on this last week: ten ministers were so fed up that they invited their colleagues to devise their own governance structure. Others at the table lent their support.
Testing limits
Second, over the past seven years, the Commission has tested the limits of the Horizon Europe regulation. That does not help the case for more flexibility.
Let’s consider each principal briefly.
Member states had to stare down liberal use of simplified cost options (lump sum, unit costs, etc.) and restrictions on third-country participation (article 22.5 for the wonks). They were also sceptical of new initiatives like the New European Bauhaus, to the point that the Commission at some point had to secure support through the highest political channels.
Parliament also has its quarrels. Their 2024 report on FP10 was critical of how the Commission handled implementation, academic freedom and association agreements. It “considered that the Commission has not succeeded in creating agile but strong management of HEU.”
Meanwhile, researchers have had their own bones to pick. A case in point are the lump-sum and personnel unit costs, which the European Court of Auditors’ opinion on FP10 considered “not the most appropriate funding mechanism in all cases.”
Leeway
The problem boils down to this: how do principals set boundaries if they don’t know how the agent will act?
Take lump-sum funding. Everyone agrees there are cases where a lump sum is preferred. A blanket ban is not on the table, and rightly so.
But how can co-legislators limit the default use of lump sum, without shutting the door completely? Without a Commission statement of intent, it is nigh impossible.
Programming
Let’s consider briefly what this means for programming before we turn to what the Commission could do and wrap up.
Top-down programming was always going to be the dominant issue in the run-up to FP10.
The interesting thing is that Commission, Council, and Parliament appear to agree on the problem analysis, but not on the solution.
All agree that programming a 200bn FP10 and a 250bn ECF through committees, as we do now, would be too cumbersome.
There is also agreement, generally speaking, that FP9’s focus on strategic planning, missions, and synergies made the programme top-heavy. DG RTD was tasked with a mission impossible: setting EU spending priorities while managing less than 10% of the EU budget.
Two ways to programme
But whereas the Commission forged ahead with merging fourteen programmes into two—FP10 and ECF—with power centralised at the heart of the Commission, Council and Parliament are now pressing the pause button.
Parliament, in particular, seems to take a different approach.
At CEPS Ideas Lab this Tuesday, rapporteur Ehler expressed his intention to adopt the Heitor recommendation of two councils overseeing pillar 2. That goes far beyond the advisory role of the ECF Stakeholder Board.
Parliament appears keen to wrest programming power away from Commission services—and programme committees—and put it in the hands of experts. A practice that is not unlike the ERC, or indeed the relationship between national research funders and their governments.
Meanwhile, in Council, the call by the ten research ministers may lead to their own deviations.
What to do?
Where does this leave the Commission proposal?
Many are still waiting for the Competitiveness Coordination Tool, but I’m sceptical. Keep in mind that this tool is intended first to coordinate EU and national investment, second to link public and private investments, and only third to prioritise spending within the EU budget, including FP10 and ECF.
Instead, I will keep my eye on three other work streams:
- The report by the expert group on the design and selection of directional initiatives, which is due this spring. This group is developing methodologies for the selection and management of the portfolio of partnerships, missions, and moonshots, basically all large-scale, top-down instruments.
- The nascent observatory on emerging technologies, linked to the ECF, that will advise on long-term trends and market failures in strategic sectors.
- The mock exercise, currently under preparation, where Commission services will attempt, for the first time, to draft a work programme under the future procedures. (And shouldn’t this have been done before the proposals?)
Conclusion
To conclude, we find ourselves in an odd and unfortunate situation.
On the one hand, President Von der Leyen has invested more political capital in R&I than any of her predecessors in the previous 25 years.
Taken together, the combined firepower of FP10 & ECF, the innovation & ERA acts, and the coordination tool are a significant step towards an integrated European research policy—and in ambition comparable to the Lisbon Strategy’s objective to invest 3% of GDP in R&I.
On the other hand, and somewhat surprisingly, the Commission has been unable to articulate a clear way forward.
Where is European research & innovation headed in 2050? The narrative is missing, with muddled communication on FP10 and ECF as a result.
Whether Europe’s prosperity in the world, or its safety, whether our societal resilience, or tackling climate change: knowledge always provides part of the solution.
So, Team Europe, where are we headed?
