New EU budget proposal foresees €94.4 billion for HEurope

The Horizon number, Commission officials said, represents an increase in total spending plans for research and innovation – by €13.5 billion, by their own measure. But inside the Brussels policy bubble this afternoon, a lively debate broke out over how to interpret the numbers – with some calling it a cut, others an increase, and yet others no change.

The confusion arose because of the way the Commission announced the news – until the last minute keeping the key numbers secret even from many of its own senior officials. It certainly caught key members of the European Parliament by surprise. One of the key Horizon legislators, Dan Nica of Romania, called it an increase from the most-recent budget plans of the European Council. The other legislator, Christian Ehler of Germany, called it an “almost suicidal” cut. 

In announcing its plan, the Commission promoted the importance of research in the recovery – a fact highlighted during the current health crisis, as governments around the world have poured several billion euros into emergency vaccine and treatment research.  And, as it released its budget plans in Brussels this afternoon, it simultaneously published a whopping 774-page report justifying the political importance of research to health, the economy, trade and just about everything.

According to Commission officials, the planned Horizon budget can be measured in either of two ways – and both would suggest an increase for research.

Under one method, using 2018 prices, the new Horizon Europe proposal amounts to €80.9 billion – the same as negotiated in February by European Council President Charles Michel, after months of bargaining with EU member states. But to that figure, an extra sum of €13.5 billion is proposed, to come from a special €750 billion recovery fund, for much of which the Commission will be borrowing money on the financial markets. That adds up to €94.4 billion, and is compared to the €83.5 billion originally proposed by the Commission in 2018 – so, an increase overall.

Under another counting method, inflation-adjusted “current” prices, the new Commission proposal for Horizon amounts to €91.178 billion – the same as Michel negotiated in February. But to it would be added €14.65 billion in recovery-fund money, bringing the total to €105.8 billion. That compares to the €94.1 billion originally proposed by the Commission in 2018.

But there is still plenty of uncertainty in these numbers. The extra research money, officials said, would go to several research areas including health, green economy, industrial innovation, and a small-business agency, the European Innovation Council. But details of exactly how the special recovery fund will be run – and whether the rules will be any different from the rest of Horizon Europe – are as-yet unclear.

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