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Chance of EU-UK deal on Horizon Europe is ‘toss-of-a-coin stuff’

Details emerge of remaining differences in talks on UK rejoining EU research programme

Whether or not the UK and EU will reach a deal on the former joining the bloc’s Horizon Europe programme is “toss-of-a-coin stuff”, with UK participation rates still a sticking point, according to a well-informed source.

Research Professional News has learned details of the recent status of negotiations, which are ongoing despite hopes in recent weeks of an imminent deal.

In 2020, the UK negotiated to join the Horizon programme, as well as the Euratom nuclear programme and Copernicus Earth-observation programme. But a dispute over trade in Northern Ireland saw the UK blocked until that issue was resolved in February 2023.

Since then, the two sides have struggled to finalise terms of Horizon membership. The British government has pushed to pay less than originally agreed, arguing that the freeze-out had caused lasting damage to UK R&D.

The two sides are understood to have edged closer together, with the remaining differences hinging on how long it would take for the UK to return to former participation rates in Horizon Europe—a key issue behind the UK’s request to lower its membership fee.

According to the source, speaking to Research Professional News on condition of anonymity, the “distance between the two teams is small” and there is a “landing zone”, but compromise is needed from both sides. “It is toss-of-a-coin stuff on whether we get a deal or not,” they said.

Financial wriggle room

Media reports in early July suggesting that a deal was close said that the UK would not join Euratom and that a financial arrangement for Horizon Europe had been negotiated.

Research Professional News understands the Commission has offered the UK either one of those options—stay out of Euratom or a financial adjustment—but not both.

Adjusting its 2020 trade and cooperation agreement with the UK has been a red line for the EU, but there is wriggle room in a financial annex to the agreement and an accompanying protocol that manages the relationship between the two sides.

The TCA contains a “correction mechanism” in case the UK’s financial contribution to Horizon Europe does not match the amount of funding British participants get back from the programme. If the UK overpays by more than 16 per cent, it can ask for financial adjustments to be made.

The Commission is understood to have said it will offer a reduced financial contribution if the 16 per cent threshold is reached, potentially by postponing payment of a fraction of the cost until a later date, at which point an adjustment could be made based on the UK’s participation rate. But the UK is pushing for a more immediate discount.

Participation rates are the central question

Currently, UK participation rates in Horizon Europe are substantially lower than would have been expected had the country joined from the start.

British researchers and businesses have still been able to take part in most funding calls, with the government providing backup funds to those who are successful. But the UK has been unable to lead collaborative projects and many European partners have been cautious about including British partners.

Previously, government sources told Research Professional News that they had forecast a range of scenarios on how UK participation could increase if the country rejoined Horizon Europe. They considered a rapid rise in participation to be unlikely and were looking to mitigate the risk of UK researchers and businesses taking part at much lower levels.

There is still divergence between the two sides on how long it would likely take UK participation to recover to former levels, according to the source speaking to Research Professional News.

They also suggested that the Commission had yet to fully recognise evidence that being outside of EU programmes had damaged UK R&D.

But there is hope that an outline of a deal could still be reached before the imminent summer break, and negotiators are now understood to be in “the tunnel”—a Brexit-era term meaning intensive talks are only taking place between small teams in secrecy.

Negotiators urged to compromise

Observers in the UK and Brussels have urged both sides to get a deal over the line.

Vivienne Stern, chief executive of vice-chancellors’ group Universities UK, said it was “legitimate that the government is seeking a good deal”, but that “nobody’s blood pressure can stand another several months of delay, and more delay would have a real, actual cost”.

Stern urged the Commission to take “a little step towards the UK”.

“There’s a lot of water under this bridge and we just need pragmatism and an acknowledgement that there has been a material loss to the UK through the delay,” she said. Stern added that there was “a real risk that everyone stands on principle”.

Thomas Jørgensen, director for policy coordination and foresight at the European University Association, said that “if there’s a minimum of goodwill” then the two sides “should be able to compromise”.

Jørgensen added that the offer from the Commission was good for the UK: “If you weigh the UK’s immediate contribution with the overall economic value, then the value proposition becomes very good.”

Both the UK’s Foreign, Commonwealth and Development Office and the Commission said they would not provide a running commentary on the talks.

A foreign office spokesperson said talks were ongoing and no deal had been agreed or finalised. “Our preference is to associate to Horizon, but the prime minister has been clear that any deal must be value for money for taxpayers and in the best interests of UK science and research.”

A Commission spokesperson said: “As foreseen by the TCA, we are in discussions with the UK on its participation in EU programmes.”