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Flexi-budget could top up Horizon 2020

Ministers may meet Parliament’s demands with minor reshuffle

Member states seem ready to make the next EU bud­get more flexible to allow for the spending of unused money on areas “where it really counts”—including on the Horizon 2020 research programme.

Several member state officials told Research Europe that the Council of Ministers is willing to make concessions to the European Parliament on budget flexibility, to bring budget negotiations to a close and prevent a deadlock. The Parliament rejected the Council’s budget proposal on 13 March, saying that it offered too little flexibility for moving money around to meet emerging needs.

The apparent readiness of both sides to make a deal is fuelling optimism that the Parliament will be dissuaded from blocking the entire 2014-20 budget—an option that would freeze future spending at 2013 levels, plus an inflationary adjustment, and wreak havoc with multi-year programmes such as Horizon 2020.

One diplomat involved in the negotiations said the Council had already had informal contacts with the Parliament to discuss possible solutions. “Our impression is that the Parliament is eager to find a way to agree,” he says. “Fortunately it’s not a situation where Council and Parliament are stuck in the trenches.”

During the European Parliament plenary session last week, MEPs proposed that greater budget flexibility would allow the EU to shift unspent money from, for example, agricultural funds, to budgets where extra funding is needed, such as competitiveness.

“Europe needs to spend more money where it really counts—on research and innovation,” says George Lyon, a liberal MEP for the UK and vice-chairman of the Parliament’s budget committee. “Therefore we need greater flexibility in spending and there should be a review in 2016 to adjust the budget if needed.”

Several sources said that this kind of adjustment could boost funds for Horizon 2020 by a few hundred million euros each year. The Council has proposed a €70.9 billion budget for the programme over seven years from 2014 to 2020. Speaking in Boston last month, Robert Jan-Smits, head of the Commission’s research directorate, said he “would not be surprised if there was a couple of billion euros more than that” after the Parliament has had its say.

The overall size of the budget is unlikely to change, however. Lucinda Creighton, Ireland’s Europe minister, who is charged with negotiating the EU budget for the Council of Ministers, said the total budget envelope of €960bn for 2014-20 is “at the limit of what is possible,” but added that “we can probably meet some concerns of the Parliament, including demands for greater flexibility.”

Diplomats said that redirecting unspent money to the competitiveness budget heading 1a would also appease countries within the Council, such as the Netherlands and the UK, which wanted more funding for Horizon 2020.

“It is very unlikely that we will see a change in the overall envelope,” says Fabian Zuleeg, an analyst at the conservative think tank European Policy Centre. “The Parliament only has one card to play, and that is the threat of an overall rejection, so it had to speak out strongly.” He predicted that the Council will now make some concessions, on budget flexibility and on a mid-term review of the seven-year budget.

A minority of MEPs criticised the Parliament for rejecting the budget proposal, when it knows that a bigger overall budget won’t happen. Gay Mitchell, a conservative MEP for Ireland, said that the failure to agree a budget could damage competitiveness programmes, such as Horizon 2020. “Budgets such as research need enough money to do their job right from the start,” he says. “I am worried that researchers won’t apply if there is a risk that they won’t be funded.”

After the Parliament rejected the budget, member states declined to discuss the matter at a meeting of European heads of state in Brussels on 14 and 15 March. The Commission will now arrange negotiations between the Parliament and the Council, ahead of the latter’s next meeting in May.