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EU Horizon approval delays hurting British research and business

25 October 2021

Delays in Brussels formalising the UK’s participation in EU research and space programmes as agreed in the Brexit Withdrawal Agreement is ‘impeding participation’ by and procurement from British organisations, according to a report published by an influential group of MPs today.

The European Scrutiny Committee Brexit Divorce Bill Report reveals that UK businesses and research institutions will face increasing opportunity costs while they are frozen out of new projects. EU approval for the UK’s participation is tied to the outcome of Northern Ireland Protocol negotiations, according to EU research commissioner Mariya Gabriel. Negotiations on the operation of the Protocol began earlier this month.

In December, the European Union provisionally agreed to the UK participating in its new research programmes, notably the flagship “Horizon Europe” research fund and the Copernicus earth observation programme, in return for a proportional contribution to the programme’s funding. However, the protocols in the Agreement enabling UK entities to bid for funding have yet to be approved by the EU.

Although Brussels has instructed funding bodies to treat the UK as an associate member of the programme in the initial stages of applying for funding, concrete grant agreements can only be signed once these provisions have been approved.

As a result, new funding streams remain closed to British institutions and businesses for the time being, including those that want to tender for lucrative procurement contracts to provide technical and scientific equipment. This is particularly an issue for the UK’s ability to contribute to the EU’s Earth mapping programme, Copernicus. The report added that UK entities “will not be able to recover these lost opportunities”.

MPs on the Committee said that the delay raised concerns about value for money of participation in EU programmes given that the UK’s financial contribution for participation would be back-dated to the start of the year, making it ten months without access being agreed to.

The UK’s gross contribution to the £15bn Horizon Europe programme is expected to be about £2.1bn a year, according to the report, an amount proportional to the size of its economy. However, the Government has said that the expected net cost will be less than half that amount when accounting for funding grants flowing back to UK institutions from the programme. It could be less still if contributions are linked to the success rate of funding bids, or Britain reduces the number of areas of cooperation it wishes to participate in.

The Committee will be questioning Brexit Minister Lord Frost this afternoon at 3.30pm on the state of negotiations with the European Union.

Chair's comment

European Scrutiny Committee Chairman Sir Bill Cash said,

“It’s been the best part of a year and British research institutions remain frozen out of key projects and funding despite agreement on participation. With each passing day the opportunities are missed, British institutions are left high and dry while science marches on without them and the returns on our financial contribution edge lower.

This needs to be addressed swiftly, so we’re calling on the Government to lay out the steps it is taking to ensure UK participation is formalised.”
Today’s report also attempts to resolve the gap between public estimates of the Brexit Withdrawal Agreement financial settlement by the Treasury (£37.3bn), the Office of Budgetary Responsibility (£34.1bn) and the European Union (£40.4bn). It found that differences in accounting practices, particularly the date from which costs are measured, and in estimates of long-term pension liabilities made up much of the gap.

Further information

Image: CCO