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![european flag](./../../../images/eclogo.jpg)EUROPEAN COMMISSION

Brussels,7.6.2018

SWD(2018) 307 final

COMMISSION STAFF WORKING DOCUMENT  
  
IMPACT ASSESSMENT

Accompanying the document

Proposals for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing Horizon Europe – the Framework Programme for Research and Innovation, laying down its rules for participation and dissemination  
  
DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on establishing the specific programme implementing Horizon Europe – the Framework Programme for Research and Innovation  
  
COUNCIL REGULATION establishing the Research and Training Programme of the European Atomic Energy Community for the period 2021-2025 complementing Horizon Europe – the Framework Programme for Research and Innovation

{COM(2018) 435 final}  
  
{COM(2018) 436 final}  
{COM(2018) 437 final}  
{SEC(2018) 291 final}  
  
{SWD(2018) 308 final}  
  
{SWD(2018) 309 final}

Table of contents

Executive Summary

1Introduction: Political and legal context

1.1Scope

1.1.1
   Political context
   

1.1.2
   Legal context
   

1.2Lessons learnt from previous programmes

2Challenges and Objectives

2.1Key features of Horizon 2020 and expected impacts of its continuation

2.2Main R&I challenges and problems to be addressed

2.3Objectives of the future Programme

3Programme structure and priorities

3.1Scope and structure of the new Framework Programme

3.2Improvements and their expected implications

3.2.1
   The European Innovation Council (EIC)
   

3.2.2
   Research and Innovation Missions
   

3.2.3
   International cooperation
   

3.2.4
   Open Science policy
   

3.2.5
   European Partnerships

3.3Overall impact on the new Framework Programme

3.4Critical mass

4Delivery for Impact

4.1The strategic planning process

4.2The single set of rules

4.3The funding model

4.4Forms of funding, including simplified cost options

4.5Grants, financial instruments and blended finance

4.6Proposal evaluation and selection

4.7Ex-ante and ex-post audits

4.8Policy and rules regarding Dissemination and Exploitation

4.9Delegation to Executive Agencies

4.10Overall impact on the objectives of the MFF

5How will performance be monitored and evaluated?

Glossary

|  |  |
| --- | --- |
| Term or acronym | Meaning or definition |
| COSME | EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises |
| EIC | European Innovation Council |
| EIT | European Institute for Innovation and Technology |
| ERAC | European Research Area and Innovation Committee |
| ERC | European Research Council |
| ERCEA | European Research Council Executive Agency |
| ERDF | European Regional Development Fund |
| EU | European Union |
| FET | Future and Emerging Technologies |
| FP7 | Seventh Framework Programme for Research and Technological Development |
| GDP | Gross Domestic Product |
| JRC | Joint Research Centre |
| KICs | Knowledge and Innovation Communities |
| MFF | Multiannual Financial Framework |
| MSCA | Marie Skłodowska-Curie Actions |
| R&I | Research and Innovation |
| REA | Research Executive Agency |
| SMEs | Small and Medium Enterprises |
| TFEU | Treaty on the Functioning of the European Union |

  

Executive Summary

This impact assessment accompanies the Commission proposal for Horizon Europe, the 2021-2027 Framework Programme for EU Research and Innovation, which will succeed the current Programme, Horizon 2020 (active between 2014-2020), and the proposal for the 2021-2025 Research and Training Programme of the European Atomic Energy Community (Euratom Programme).

Research and innovation help Europe deliver on citizens' priorities, as embodied in the Sustainable Development Goals and in the Paris Agreement on fighting climate change, to bring about sustainable growth and high-quality jobs, and to solve present and unforeseen global challenges. However, Europe overall currently underinvests in research and innovation compared to its main trading partners, and so risks being irreversibly outpaced.

EU-level investment, through successive Framework Programmes, has supported the provision of public goods with a high European added value. This added value comes from the Programmes’ focus on excellence through EU-wide competition and cooperation. Framework Programmes support training and mobility for scientists, create transnational, cross-sectoral and multidisciplinary collaborations, leverage additional public and private investment, build the scientific evidence necessary for EU policies, and have structuring effects on national research and innovation systems. The significant and long-lasting impact of the Framework Programmes, in particular the current Programme, is acknowledged by the EU institutions, Member States and stakeholders alike.

Horizon Europe is built on the evidence and lessons learnt from the Horizon 2020 interim evaluation, and the recommendations of the independent High-Level Group on maximising the impact of EU research and innovation. The new Programme will be an evolution, not a revolution, focusing on a few design improvements to further increase openness and impact.

Horizon Europe’s general objectives stem from the Treaty on the Functioning of the European Union. These will be: to strengthen the scientific and technological bases of the Union and foster its competitiveness, including for its industry; to deliver on the EU's strategic policy priorities and contribute to tackling global challenges, including the Sustainable Development Goals. To address particular research and innovation challenges faced by the EU, Horizon Europe also has specific objectives. All objectives apply across the Programme, and all individual Programme parts will contribute to their achievement.

The evolution from Horizon 2020 is reflected in the revamped structure. The three-pillar structure will be continued, but redesigned for more coherence, both between and within pillars, in support of the Programme objectives.

Pillar 1 - Open Science will continue to focus on excellent science and high-quality knowledge to strengthen EU’s science base through the European Research Council, Marie-Skłodowska Curie Actions and Research Infrastructures. As a "bottom-up", investigator-driven pillar, it will continue to give the scientific community a strong role.

Pillar 2 - Global Challenges and Industrial Competitiveness will better address EU policy priorities and support industrial competitiveness by integrating the Horizon 2020 Societal Challenges and Leadership in Enabling Industrial Technologies into five clusters (i.e. Health; Resilience and Security; Digital and Industry; Climate, Energy and Mobility; and Food and natural resources). The clusters will better support the full spectrum of the Sustainable Development Goals, and increase collaborative research and innovation across sectors, disciplines and policy fields – boosting flexibility, focus, and impact. Due to its policy focus, the pillar will be implemented "top-down", through a strategic planning process ensuring the involvement of stakeholders and society, and alignment with Member States' activities. The pillar will give appropriate visibility to industry’s essential role in achieving all the Programme’s objectives, not least in tackling global challenges, including by developing key enabling technologies for the future.

Pillar 3 – Open Innovation will offer a one-stop shop for high-potential innovators with the European Innovation Council and increase cooperation with innovation ecosystems and actors. This pillar will integrate and reorganise Horizon 2020 activities, such as Innovation in SMEs (notably the SME instrument), Fast-track to Innovation, as well as Future and Emerging Technologies. Innovation will continue to be supported throughout the whole Programme, not just in this innovation-focussed pillar.

Horizon Europe will reinforce the European Research Area through: Sharing excellence (extending the Horizon 2020 actions that help tackle low research and innovation performance i.e. Teaming, Twinning, ERA chairs, and COST); research and innovation reforms and policy, covering the Policy Support Facility; foresight activities; and Framework Programme monitoring, evaluation, dissemination and exploitation of results

The new Programme will also have some new features and enhancements of existing elements. With Horizon 2020 well on track to deliver excellence, impact and openness, these changes will make the successor Programme achieve even more impact (through the European Innovation Council and mission-orientation) and more openness (through strengthened international cooperation, a reinforced Open Science policy, and a new policy approach to European Partnerships).

The European Innovation Council will help place the EU in the lead for breakthrough market-creating innovation. It will support high-risk, market-creating innovation projects that do not (yet) generate revenues, to bridge the “valley of death” between research and commercialisation and help companies scale up. The tailor-made support to innovators will be channelled through two main funding instruments. The Pathfinder for Advanced Research will provide grants from the early technology stage (proof of concept, technology validation) to the early commercial stage (early demonstration, development of business case and development of strategy). The Accelerator will support the further development and market deployment of breakthrough and market-creating innovations, to a stage where they can be financed on usual commercial terms by investors (from demonstration, user testing, pre-commercial production and beyond, including scale-up). It will place a particular emphasis on innovation generated within the Pathfinder, although it will also fund projects from other parts of the Programme, such as the European Research Council or the Knowledge and Innovation Communities. The expected implications of the role played by the European Innovation Council include more innovation that creates the new markets of the future, more companies that scale up in Europe, higher growth among SMEs, and more entrepreneurship and risk-taking.

Horizon Europe will see the introduction of a limited set of highly visible research and innovation ‘missions’ under Pillar 2 (but potentially also providing direction to the other pillars). Missions will prioritise investment and set directions to achieve objectives with societal relevance, thereby creating more impact and outreach, encouraging a systemic approach (moving from a view of narrow sectors to entire systems), and aligning instruments and agendas for research and innovation across Europe. Missions will either accelerate progress towards a set scientific, technical or societal solution, by focusing large investment on a specific target; or transform an entire social or industrial system within an established timeframe. They will be selected after the Programme launch, according to strict selection criteria, and co-designed with Member States, stakeholders and citizens. The expected implications of this new mission approach include more cross-sectoral and cross-disciplinary cooperation, higher impact on global challenges and EU priorities, and a reduced gap between science and innovation, and society.

Strengthened international cooperation is vital for ensuring access to talent, knowledge, facilities and markets worldwide, for effectively tackling global challenges and for implementing global commitments. The Framework Programme will intensify cooperation and extend openness for association to all countries with proven science, technology and innovation capacities, to make cooperation and funding of joint projects as smooth as possible. The programme will continue to fund entities from low/middle income countries. Entities from industrialised and emerging economies will be funded only if they possess essential competences or facilities. The expected implications include higher excellence in the Programme, more influence for the EU in shaping global research and innovation systems, and higher impact.

Open Science will become the modus operandi of the new Programme, going beyond Horizon 2020’s open access policy to require immediate open access for publications and data (with opt-out possibilities for the latter), and research data management plans. The Programme will encourage the proliferation of FAIR data (findable, accessible, interoperable, and re-usable) and support a sustainable and innovative scholarly communications ecosystem. It will foster activities to improve researcher skills in Open Science and the reward systems that promote this. Research integrity and citizen science will play a central role, as will the development of a new generation of research assessment indicators.

The new approach to European Partnerships will be more impact-focussed. The need to establish future European Partnerships or renew existing ones will be identified as part of the strategic programming process for the Framework Programme. European Partnerships will be open to all types of stakeholders (e.g. industry, Member States and philanthropic foundations) and will be limited in time, with clear conditions for the phasing out of the Framework Programme funding. They will be based on the principles of Union added value, transparency, openness, impact, leverage effect, long-term financial commitment from all parties, flexibility, coherence and complementarity with Union, local, regional national and international initiatives. The future partnership landscape will ensure optimal coherence between Framework Programme activities and partnerships. There will be only three types: i) co-programmed European Partnerships, based on memoranda of understanding or contractual arrangements; ii) co-funded European Partnerships, based on a single, flexible co-fund action; iii) institutionalised European Partnerships (based on Article 185 or 187 of the Treaty on the Functioning of the European Union). Following a life-cycle approach, the Framework Programme will set out the criteria for selecting, implementing, monitoring, evaluation and phasing out all European Partnerships.

The changes to the Programme's structure and the improvements to it will facilitate the achievement of the Programme's objectives, making it more effective and helping it generate even more economic benefits and value for money. These effects will be amplified by strengthened synergies and complementarities with other EU programmes, for example through the Seal of Excellence.

Efficient delivery is essential for meeting all the objectives. It is also key to achieving higher impact and further simplification. Building on the achievements of Horizon 2020, simplification remains a continuing endeavour also in the new Programme. Several improvements have been made to streamline delivery for impact. The Programme will aim at further simplification within the present real cost reimbursement system with its simplified funding model. Increased use will be made of project funding against fulfilment of activities (i.e. lump sum) and other simplified forms of funding allowed by the new Financial Regulation. Cross-reliance on audits across EU programmes and acceptance of usual cost accounting practices will be developed. To increase flexibility, the Programme will support the intersection of disciplines and sectors and allow allocation of funds between and within pillars to react swiftly to emerging issues or challenges. Further improvements to the proposal submission and evaluation process will be envisaged by continuously trying to reduce the 'time to grant' and by improving feedback to applicants. The evaluation criteria, process and involvement of independent experts will underscore the Programme's excellence and impact. Innovation support schemes will be streamlined under the European Innovation Council, while the complementarity between grants and financial instruments could be reinforced through blended finance.

Impact depends ultimately on the dissemination and exploitation of research and innovation data and results, and it needs to be effectively captured and communicated. An ambitious and comprehensive strategy will increase the availability of such data and results and accelerate their uptake to boost the overall impact of the Programme. Portfolios of mature results will be exploited in synergy with other EU programmes to ensure their uptake at national and regional level, maximising European innovation potential. This will be complemented by effective communication and outreach campaigns that build trust and engage citizens.

Progress towards the Programme’s objectives will be tracked along 'impact pathways' (on scientific, societal, and economic impact). The impact pathways will be time-sensitive, distinguishing between the short, medium and long term. The impact pathway indicators will contain both qualitative and quantitative information, the availability of which will depend on the Programme's stage of implementation. Individual programme parts will contribute to these indicators to varying degrees and through various mechanisms. The data behind the key impact pathway indicators will be collected in a centrally managed and harmonised way that imposes minimum reporting burden on beneficiaries, including using unique identifiers for applicants and sourcing data automatically from existing external public and private databases. Baselines, targets and benchmarks will be established before the Programme’s launch. Management and implementation data from the Programme will continue to be collected in near real-time. An analysis of progress on key dimensions of management and implementation will be carried out every year. Interim and ex-post evaluations will ensure that methodologies are consistent and coverage is comprehensive.

1Introduction: Political and legal context

1.1Scope

This impact assessment accompanies the Commission proposals for Horizon Europe, the 2021-2027 Framework Programme for EU Research and Innovation (R&I), which will succeed Horizon 2020 (2014-2020): proposals for the Framework Programme and Rules for Participation
[1](#footnote2)
, the Specific Programme
[2](#footnote3)
, as well as the 2021-2025 Research and Training Programme of the European Atomic Energy Community (Euratom Programme)
[3](#footnote4)
. An impact assessment for the defence research has been carried out separately and is accompanying the proposal for the European Defence Fund Regulation.

R&I are crucial for providing solutions to the challenges of our time. They deliver on citizens' priorities, as embodied in the Sustainable Development Goals and in the Paris Agreement on fighting climate change
[4](#footnote5)
, on growth and jobs, and to solve the global challenges we face today and will face tomorrow
[5](#footnote6)
. In areas like health, digital technologies, industrial transformation, resilient societies, natural resources, energy, mobility, environment, food, low-carbon economy and security, R&I are critical to the success of EU priorities, in particular jobs and growth, Digital Single Market, Energy Union and climate action. R&I are at the core of the productivity and competitiveness of our economy. About two-thirds of Europe's economic growth over the last decades has been driven by R&I. R&I support the creation of new and better jobs and the development of knowledge-intensive activities, which account for more than 33% of total employment in Europe. Moreover, to ensure sustainable growth and the capacity to address the societal challenges ahead, Europe must reinforce and maintain its technology and industrial capacities in the key areas that underpin the transformation of our economy and society. 

|  |
| --- |
| "Fostering R&I across the EU" is the most important policy challenge for 97% of respondents to the cluster-based public consultation on EU funds in the area of investment, research & innovation, SMEs and single market [6](#footnote7) . |

R&I determine the productivity and competitiveness of our economy: about two-thirds of Europe's economic growth over the last decades was driven by innovation. They support the creation of new and better jobs, and the development of knowledge-intensive activities, which account for more than 33% of total employment in Europe
[7](#footnote8)
. Europe must maintain and even reinforce its technological, industrial and innovation capacities in a sustainable way, in the strategic areas that underpin our society, economy and international commitments.

Currently, Europe underinvests in R&I compared to its main trading partners. If this continues, Europe risks being outpaced irreversibly. The EU's overall R&I intensity is just above 2% of GDP (failing to meet the 3% target
[8](#footnote9)
). In particular, private investment in research and development in the EU has remained low in comparison to other advanced economies, and the gap has grown again since 2013. This poor EU performance signals a weak capacity to translate knowledge into market-creating innovations
[9](#footnote10)
. Europe has to anticipate and ride the new global wave of breakthrough innovation that is coming up, one that will be more “deep-tech”
[10](#footnote11)
 and will affect sectors such as manufacturing, financial services, transport or energy.

EU-level R&I investments support public goods
[11](#footnote12)
 with a high European added value
[12](#footnote13)
: through EU-wide competition for excellence, EU investments support the training and mobility of scientists, create transnational and multidisciplinary collaboration, leverage additional investment from the public and private sectors, build the scientific evidence necessary for effective EU policies, and structure national R&I systems
[13](#footnote14)
.

To stimulate innovation in Europe, more is needed. EU investments in R&I must be enhanced and re-designed to better serve strategic areas for Europe and cover the full value chain development from early and advanced research to innovation and market deployment. They must be matched by national investments in R&I, and the market and regulatory framework must create the right conditions for innovation to flourish
[14](#footnote15)
. However, these issues are outside the scope of this impact assessment.

1.1.1Political context

The common view of the EU Institutions is that the Framework Programmes for R&I have a high EU added value and that the implementation of the current Programme is largely a success. In addition to the Communication on the Interim Evaluation of Horizon 2020
[15](#footnote16)
, the Commission’s reflection paper on the future of EU finances highlights R&I as a key European priority
[16](#footnote17)
, citing it as an example of a public good with clear EU added value. Opinions and reports from the European Parliament 
[17](#footnote18)
, the European Economic and Social Committee 
[18](#footnote19)
, the Committee of Regions 
[19](#footnote20)
, the European Research Area and Innovation Committee (ERAC, where Member States' public administrations are represented)
[20](#footnote21)
, and more recently, the Competitiveness Council (through Council Conclusions
[21](#footnote22)
) support the findings of the Interim Evaluation, in particular stressing that EU added value must be the major driver for the design and implementation of the next Framework Programme.

Box 1 Overall budget envelope

|  |
| --- |
| On 2 May 2018, the European Commission adopted its proposals for a new Multiannual Financial Framework (MFF) for 2021-2027 [22](#footnote23) . Under these proposals, the Horizon Europe and the Euratom programmes will have a combined budget of EUR 100 billion over this period. This impact assessment report reflects the decisions of the MFF proposals and focuses on the changes and policy choices which are specific to these instruments. |

In response to the Horizon 2020 interim evaluation, the European Parliament, supported by the Committee of Regions, similarly calls, among others, on the EU to avoid budget cuts to Horizon 2020 and to endow the successor programme with at least EUR 120 billion
[23](#footnote24)
. The ERAC calls for proportionality between budget and ambitions. Similarly, Council Conclusions emphasise the need to prioritise R&I across all relevant EU policies, and provide significant funds for the future programme.

1.1.2Legal context

The Framework Programme for R&I is based on Articles 173, 182, 183 and 188 of the Treaty on the Functioning of the European Union
[24](#footnote25)
. This initiative is in an area of (shared) parallel competence and the subsidiarity and proportionality principles apply. This impact assessment satisfies the requirements of the Financial Regulation in respect of preparing an ex-ante evaluation.

The EU Framework Programme for R&I respects the subsidiarity and proportionality principles. Action at EU level is necessary: the underlying findings of a recent external study are that more than four out of five Horizon 2020 projects would not have gone ahead without Horizon 2020 funding
[25](#footnote26)
. They produce undeniable added value in terms of scale, speed and scope compared to national and regional-level support to R&I (without replacing it
[26](#footnote27)
) by boosting excellence through transnational competition, strengthening impact via collaborative R&I, and providing critical mass to tackle global challenges (see Annex 4). Moreover, it is proportionate, not going beyond what is required for Union objectives.

1.2Lessons learnt from previous programmes

EU Framework Programmes have generated significant and long-lasting impacts
[27](#footnote28)
, as shown by successive evaluations since the EU started investing in R&I in 1984. More details on the lessons learnt from evaluations of previous Programmes are in Annex 3.

Box 2: Recommendations from the ex-post evaluation of the Seventh Framework Programme

|  |
| --- |
| The Ex Post Evaluation of the Seventh Framework Programme (FP7) made the following recommendations [28](#footnote29) , which are also relevant for this impact assessment:  a.Ensure focus on critical challenges and opportunities in the global context.  b.Align research and innovation instruments and agendas in Europe.  c.Integrate the key components of the Framework Programmes more effectively.  d.Bring science closer to the citizens.  e.Establish strategic programme monitoring and evaluation. |

The Communication on the interim evaluation of Horizon 2020
[29](#footnote30)
 identified several areas for improvement. In addition to in-depth analysis, this was based on extensive stakeholder feedback
[30](#footnote31)
 and the strategic recommendations of the independent High Level Group on maximising the impact of EU R&I Programmes (Lamy High Level Group):

·Continue simplification. Horizon 2020 has made great progress in terms of simplification compared to FP7, but simplification is an ever continuing undertaking, requiring constant improvements. Further simplification should be pursued to support faster innovation cycles and lower administrative burden.

·Support breakthrough innovation. While some potential for supporting breakthrough, market-creating innovation was identified in Horizon 2020, such support should be considerably strengthened in order to identify, develop and deploy breakthrough and market-creating innovations and support the scale-up of young and quickly growing innovative companies to international and European levels.

·Create more impact through mission-orientation and citizen involvement. The Framework Programme needs greater impact and more outreach to citizens. A mission-oriented approach would increase the focus on impact, while involving citizens, customers and end-users in agenda-setting (co-design) and implementation (co-creation) leads to more innovation by stimulating user-driven innovation and the demand for innovative solutions.

·Increase synergies with other EU funding programmes and EU Policies. While synergies already exist between Horizon 2020 and other EU programmes, they should be further strengthened. In particular, building on synergies with the European Structural and Investment Funds (ESIF) and smart specialisation strategies, R&I capacities built over the past decade in lower performing regions could be better used for Framework Programme-supported projects.

·Strengthen international cooperation. While Horizon 2020 has a broad international outreach and openness to the world, third-country participations declined when compared to FP7
[31](#footnote32)
. International cooperation in R&I is vital for ensuring access to talent, knowledge, know-how, facilities and markets worldwide, for effectively tackling global challenges, and for implementing global commitments. It needs to be further intensified in order to strengthen Europe's R&I excellence and competitiveness.

·Reinforce openness. There is a need to build on the great progress made in terms of making the scientific publications and data generated by Horizon 2020 openly accessible to the wider scientific community and public. The next Framework Programme should fully embrace Open Science policy as a way of strengthening scientific excellence, benefiting from citizen participation, achieving better reproducibility of results, and increasing the re-use of research data.

·Rationalise the funding landscape. A key area for improvement is the rationalisation of the funding landscape, in particular with respect to partnership instruments and initiatives. Reforming the current policy approach to European Partnerships should make it possible to use the full potential of the new or renewed European Partnerships in achieving ambitious policy objectives that cannot be achieved by the Union or national action alone.

Following the Interim Evaluation of Horizon 2020, the Lamy High Level Group report (presented at the conference "Research & innovation – shaping our future" on 3 July 2017)
[32](#footnote33)
 and the open public stakeholder consultations for the preparation of the sectorial legislation accompanying the proposal for the post-2020 MFF, more than 300 position papers were received. Fostering R&I across the EU resulted as the most important policy challenge according to the respondents to the public stakeholder consultation. Key messages and a detailed analysis of this stakeholder input can be found in an Annex 2.

2Challenges and Objectives

2.1Key features of Horizon 2020 and expected impacts of its continuation

Having excellence as the core underlying principle, Horizon 2020 attracts participants from the best institutions and companies in and outside Europe, covering a wide range of disciplines. Stakeholders express strong satisfaction with the programme, as shown by the sustained interest in its highly competitive calls and high oversubscription rates (which is commonly quoted by stakeholders as being the biggest problem). The programme offers unique collaboration and networking opportunities. Scientific publications of Horizon 2020 are cited already at twice the world average rate. Patents produced through the programme are of higher quality and likely commercial value than similar patents produced elsewhere. Horizon 2020 has shown flexibility in responding to evolving political priorities, such as migration, and emergencies such as the Ebola and Zika outbreaks. Horizon 2020 is on track to contribute significantly to the creation of jobs and growth. Moreover, it supports EU policy objectives through its focus on excellent science, industrial leadership and societal challenges

|  |
| --- |
| Key features of Horizon 2020:  ·significant budget (close to EUR 77 billion) for 7 years (2014-2020), with a target of 35% related to climate action and 60% related to Sustainable Development;  ·seamless integration of R&I into a single framework, from ‘blue-sky’, frontier research to close-to-market innovation activities;  ·direct R&I investments through an EU-wide competition based on excellence as guiding principle (and main evaluation and selection criterion);  ·central management by the European Commission, its executive agencies or other implementing bodies;  ·a three-pillar structure focusing on excellent science, industrial leadership and societal challenges.  ·major simplification measures implemented through the Common Support Centre, such as a single set of rules, an easy to use cost reimbursement model, a single point of access for participants, fewer audits. |

The continuation of the ongoing Programme is expected to generate even more:

·new knowledge and technologies, promoting scientific excellence and significant scientific impact. The Programme will continue to facilitate cross-border collaboration between top scientists and innovators, allowing for trans-national and cross-sector coordination between public and private R&I investment. Horizon 2020 has already attracted the world’s best research institutions and researchers, supported ~340,000 researchers, and developed Europe’s human capital. The first scientific publications from Horizon 2020 are world-class (cited more than twice the world average) and contributed to major discoveries like exoplanets, the Higgs boson, and gravitational waves.
[33](#footnote34)
.

·positive effects on growth, trade and investment flows
[34](#footnote35)
, quality jobs and international mobility for researchers in the European Research Area. The continuation scenario is expected to bring an estimated average GDP increase of 0.08% to 0.19% over 25 years, which means that each euro invested can potentially generate a return up to 11 euros of GDP gains over the same period
[35](#footnote36)
[36](#footnote37)
 (see Annex 5). EU investments in R&I are expected to directly generate an estimated gain
[37](#footnote38)
 of up to 100,000 jobs in R&I activities in the “Investment phase” (2021-2027) and to foster an indirect gain of up to 200,000 jobs over 2027-2036, of which 40% are high-skilled jobs, through the economic activity generated by the Programme.

·significant social and environmental impact. This will happen directly through the dissemination, exploitation and uptake of scientific results translated into new products, services and processes, which in turn contribute indirectly to the successful delivery on political priorities.

These impacts mean that the potential cost of discontinuing the EU R&I Programme (i.e. cost of non-Europe) is substantial. Discontinuation would result in a decline of competitiveness and growth (up to EUR 720 billion of GDP loss over 25 years
[38](#footnote39)
), sharp reductions in the private and national investments that are currently leveraged by EU-level co-investments, creating significant losses of social, environmental and economic impacts.

Box 3: Three phases of the economic impact of the Framework Programme

|  |
| --- |
| The expected economic impact of continuation is decomposed in three phases in the NEMESIS model [39](#footnote40) :  ·The investment phase. From the beginning to the end of the Programme (2021-2027). Assuming a “maturation” lag of innovation between 3 and 5 years, economic impact is driven by the spending, with comparatively moderate impact from the production of innovations at this stage.  ·The innovation phase. During and after the investment phase, R&I investments produce economic effects through the creation of new process and product innovations. Process innovation increases efficiency, which leads to lower cost. Product innovation increases the quality of, and raises the demand for, products. The lower cost and enhanced quality increase competitiveness.  ·The obsolescence phase. After the innovation phase, knowledge depreciation decreases gains.  Figure 1: GDP gains from the continuation of Horizon 2020 (percentage change compared to a situation without Framework Programme)    \*Note: Figures calculated for EU-27; different sets of results from QUEST are presented in Annex 5 based on different funding assumptions. This graph presents the scenario with higher benefits. |

2.2Main R&I challenges and problems to be addressed

Based on the key findings and lessons learnt from the Horizon 2020 Interim Evaluation (see section 1.2 above), the following key challenges in the area of R&I to be addressed by the future Programme have been identified:

1) The creation and diffusion of high-quality new knowledge and innovation in Europe should be improved. Europe is overall a global scientific powerhouse, but it is essentially a "mass producer [of knowledge] with, relative to its size, comparatively few centres of excellence that standout at the world level and with large differences between European countries"
[40](#footnote41)
. Moreover, the gap between high productivity firms and the rest has grown, illustrating a serious issue in the circulation of knowledge and technologies. This corresponds to the following findings of the Horizon 2020 Interim Evaluation:

·Sub-optimal creation
[41](#footnote42)
 of high-quality knowledge and lack of diffusion
[42](#footnote43)
 of knowledge across borders, sectors, disciplines
[43](#footnote44)
 and along the value chain;

·Insufficient open science
[44](#footnote45)
;

·Scattered pockets of scientific excellence and R&I infrastructures
[45](#footnote46)
;

·Rapid increase of global competition for talent
[46](#footnote47)
;

·Hampered global R&I cooperation
[47](#footnote48)
.

2) There is a need to reinforce the impact of R&I in policy-making. R&I have to take a more prominent place in shaping EU policy priorities and for delivering on policy commitments and priorities of the Union. R&I are expected to make a crucial contribution to achieving EU policy priorities, including the Sustainable Development Goals. The impact is stronger when investments are prioritised in areas where the EU added value is greatest
[48](#footnote49)
 and aligned with policy needs; when support provides incentives in a highly performing and dynamic system with supportive framework conditions; and where R&I results have a strong potential to feedback into the policy-making cycle. Investments in R&I have to better fit into the full innovation cycle, from societal needs to market deployment, supporting the implementation of EU, national and regional strategic policy priorities. Uptake of innovative solutions has been low so far, and more needs to be done to increase end-user involvement, for demonstrating and scaling up promising solutions and create favourable market and framework conditions for innovation, including social innovation, while ensuring that competition in the internal market which drives the innovative efforts of companies and unlocks their innovative potential is not distorted. This corresponds to the following findings of the Horizon 2020 Interim Evaluation:

·Variable focus on EU strategic challenges
[49](#footnote50)
;

·Sub-optimal link between R&I and EU policy-making
[50](#footnote51)
;

·Low awareness of innovative solutions and insufficient end-user/citizen involvement in the R&I process
[51](#footnote52)
.

3) EU is lacking rapid uptake of innovative solutions. Around two thirds of EU manufacturing companies have not recently used any advanced technologies
[52](#footnote53)
, and competition from the USA and Asia has intensified. The EU's substantial knowledge assets, notably in the field of key enabling technologies, need to be more effectively and quickly turned into innovations, particularly as innovative solutions for global challenges are increasingly research-intensive. Apart from aiming at high industrial participation in the programme, a stronger focus is needed on innovators working on breakthrough market-creating innovations - these are rare in Europe (fast-growing start-ups, so-called unicorns, are five times fewer than in the USA
[53](#footnote54)
). This corresponds to the following findings of the Horizon 2020 Interim Evaluation:

·Slow industrial transformation
[54](#footnote55)
;

·Limited scale-up of innovative SMEs at EU level and lack of venture capital
[55](#footnote56)
;

·Lack of entrepreneurial skills to translate ideas into innovations
[56](#footnote57)
.

4) There is a need to strengthen the European Research Area (ERA). While strong progress was made over the last years
[57](#footnote58)
, knowledge flows, good working conditions, effective career development of researchers and other ERA priorities, need to be more widely spread. Within the EU, scientific excellence is rather concentrated, and EU funding from Horizon 2020 to low performing R&I countries remains low
[58](#footnote59)
. The delivery of the Programme can only be optimised by unlocking the potential of all partners - this means there is a need for strengthening the EU scientific and technological base and spreading the benefits of excellence
[59](#footnote60)
.

2.3Objectives of the future Programme

The Framework Programme’s general objective is based on Article 179.1 TFEU:

to strengthen the scientific and technological bases of the Union and foster its competitiveness, including for its industry, deliver on the EU's strategic policy priorities and contribute to tackling global challenges, including the Sustainable Development Goals.

As a lesson learnt from the Interim Evaluation of Horizon 2020 supported by strong stakeholder feedback, specific objectives are identified for the Programme as a whole (i.e. not per part or instrument) to improve coherence and linkages among Programme parts. Based on the challenges identified in section 2.1, the specific objectives are:

1)to support the creation and diffusion of high-quality new knowledge, skills, technologies and solutions to global challenges;

2)to strengthen the impact of research and innovation in developing, supporting and implementing Union policies, and support the uptake of innovative solutions in industry and society to address global challenges;

3)to foster all forms of innovation, including breakthrough innovation, and strengthen market deployment of innovative solutions;

4)to optimise the Programme's delivery for increased impact within a strengthened European Research Area.

General and specific objectives will be pursued through an improved Programme structure (Section 3). The implementation of the Programme will be optimised in terms of delivery (Section 4) in line with the cross-cutting objectives of the MFF, notably simplification, flexibility, coherence, synergies and focus on performance. The specific objectives are operationalised in the Specific Programme implementing the Framework Programme. All objectives articulate with each other coherently, so that all actions in each pillar can deliver on the objectives without risking any inconsistencies or exclusions.

Figure 2: Link between the Framework Programme’s challenges and objectives.

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_07004.jpg)

3Programme structure and priorities

3.1Scope and structure of the new Framework Programme

“An evolution, not a revolution”
[60](#footnote61)
 - building on the positive findings of the Horizon 2020 Interim Evaluation, stakeholder feedback
[61](#footnote62)
 and the Lamy High Level Group report, only a further refinement of the current Programme is necessary
[62](#footnote63)
. Therefore, the vast majority of the parts and features of Horizon 2020 will be continued, albeit with several optimisations and minor redesigns. As all components of the Framework Programme are necessary to achieve its objectives, a different level of ambition (including budgetary) would result in an adjusted level of support across all areas. Moreover, compared to Horizon 2020, Horizon Europe will invest less in sector-specific projects and partnerships, and focus instead on systemic transformations.

The Programme’s scope will continue to cover research
[63](#footnote64)
 and innovation
[64](#footnote65)
 in an integrated manner. Scientific knowledge, societal challenges and industrial technologies should complement each other and be mutually reinforcing, bringing industry, academia, public stakeholders, and citizens closer together, and thereby aligning the processes and the outcomes of R&I with societal needs, expectations and values, including gender balance. In close synergies with other EU Programmes, the Framework Programme will continue to support the whole innovation ecosystem with seamless support from the lab to the market uptake for high-risk activities that would not be performed without public support.

Error! No sequence specified.Box 4: The three-pillar structure of Horizon 2020

|  |
| --- |
| Pillar 1 - Excellent Science aims to raise the level of excellence in Europe's science base and ensure a steady stream of world-class research to secure Europe's long-term competitiveness. Pillar 2 - Industrial Leadership aims to speed up the development of the technologies and innovations that will underpin tomorrow's business and help innovative European SMEs to grow into world-leading companies. Pillar 3 - Societal Challenges responds directly to the policy priorities of the Europe 2020 strategy and aims to and addresses major concerns shared by citizens in Europe and elsewhere.  In addition to the three pillars, Horizon 2020 has two specific objectives: (i) "Spreading Excellence and Widening Participation" and (ii) "Science With and for Society". It also includes support for the European Institute of Innovation and Technology (EIT) – with the objective of promoting the knowledge triangle – and for the Joint Research Centre (JRC) – with the objective of providing robust evidence for EU policy making. Furthermore, a number of cross-cutting issues are promoted, e.g. the realisation of the European Research Area (ERA), Responsible Research and Innovation, SMEs and private sector participation, Social Sciences and Humanities, gender, international cooperation, sustainable development and climate-related expenditure.  Figure 3: The three-pillar structure of Horizon 2020 |

The three-pillar structure will be continued and optimised. It will be redesigned to better address the challenges described in Section 2.2. With clearly defined and complementary rationales for intervention, each part will contribute to all the specific objectives. The design of the three pillars will ensure interconnections leading to mutual reinforcement of activities, helping meet the Programme's objectives and ultimately boosting the overall impact (see 
[Figure 4](#_Ref512435649)
). Support to basic research will remain a cornerstone of the Programme, pursued primarily under the first pillar (but also in the other two pillars); applied research and incremental innovation will be the centre of gravity in the second pillar, addressing both industrial and societal needs (Global Challenges and Industrial Competitiveness); innovation is the focus of the third pillar (Open Innovation). The largest share of resources is needed for Global Challenges and Industrial Competitiveness pillar, followed by Open Science and Open Innovation, whereas Strengthening the European Research Area entails only limited budget.

|  |
| --- |
| The majority of stakeholders commenting on the pillar structure are satisfied with the current three-pillar structure of Horizon 2020 and wish to see either a complete replication or some modifications to the exsisting architecture. The main suggestions for improvements over the Horizon 2020 structure relate to increasing the links between pillars to improve the coverage of the entire knowledge and innovation chain. Several position papers outline the increasing importance of the ‘Societal Challenges’ and call for a more prominent pillar that takes into account the current socio-economic issues [65](#footnote66) . |

The revised pillar structure reflects the nature of the R&I challenges, which has evolved compared to Horizon 2020. As highlighted in previous sections, the Programme needs to be equipped with an innovation-focussed pillar to support breakthrough market-creating innovations that bring transformational changes. In addition, given the crucial role of Key Enabling Technologies in the economy and society
[66](#footnote67)
, the R&I agenda-setting has to integrate industry’s contribution to societal needs with efforts to tackle global challenges and other EU political priorities in order to improve the coherence and impact of the Programme.

The overarching mission-orientated approach will provide a sense of direction to all activities supported by the Programme. For instance, future missions under pillar 2 (see section 3.2.2) will be planned in the context of ongoing frontier research under the ERC. While fully respecting the bottom-up nature of those programme parts, relevant ERC and MSCA projects might be linked to ongoing missions. The scale and scope of missions can also inspire new research and innovation proposals elsewhere in the Programme. Promising projects from either of the first two pillars might produce spin-offs and be scaled-up with support under the EIC Accelerator under pillar 3 (see section 3.2.1). Similarly, activities supported through the EIT KICs may be picked up under the EIC Accelerator, or feed into ongoing missions (see Annex 8).

Figure 4 Main structure of the Framework Programme: "evolution, not revolution"

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_07006.jpg)

·Pillar 1 - Open Science: Building on its current successes, the first pillar will continue to focus on excellent science and high-quality knowledge to strengthen EU’s science base through the European Research Council (ERC), Marie-Skłodowska Curie Actions (MSCA) and Research Infrastructures. A greater emphasis will be placed on Open Science policy (open access to publications, accessibility and reuse of scientific data), including in the Research Infrastructures part in support for the European Open Science Cloud. In view of the largely "bottom-up", investigator-driven nature of this pillar, the European scientific community will continue to play a strong role. The Future and Emerging Technologies (FET) part (Pro-active, Open and Flagships) has, and continues to have, a relevant impact on knowledge production, the economy and society
[67](#footnote68)
. The lessons learnt
[68](#footnote69)
 from these essential instruments will be taken forward and streamlined with other instruments in the Framework Programme (see section 3.2.1). However, the “FET” label will be discontinued for increased coherence and user-friendliness, in the interest of rationalising the support landscape.

·Pillar 2 - Global Challenges and Industrial Competitiveness: The second pillar will integrate the Horizon 2020 parts Societal Challenges and Leadership in Enabling Industrial Technologies to better address EU policy priorities and support industrial competitiveness. Due to its policy focus, the pillar will be implemented "top-down" through a strategic planning process ensuring societal and stakeholder involvement, and alignment with Member States' R&I activities. The pillar will provide robust, evidence-based support to Union policies, in particular through the Joint Research Centre (JRC). While maintaining a strong degree of continuity with Horizon 2020, the main changes will be:

-Societal Challenges and Leadership in Enabling Industrial Technologies of Horizon 2020 integrated in five clusters to enable more flexibility and interdisciplinarity, with a specific digital and industry cluster (see 
[Box 5](#_Ref512419903)
);

-reinforced mission-orientation, with a limited set of highly visible R&I missions that engage citizens and civil society organisations to help reach ambitious goals
[69](#footnote70)
 (see Annex 8 on missions);

-higher visibility for industry’s role in solving global challenges (see 
[Box 6](#_Ref511999092)
), including through Key Enabling Technologies.

-simplified forms of partnership initiatives that are open to all (e.g. private sector, Member States, philanthropic foundations; see Annex 8).

Error! No sequence specified.Box 5: Clusters in the Global Challenges and Industrial Competitiveness pillar

|  |
| --- |
| The Global Challenges and Industrial Competitiveness pillar has five clusters that cover the activities of the LEIT part of pillar 2 and the seven societal challenges of pillar 3 of Horizon 2020. The clusters are Health; Inclusive and Secure Society; Digital and Industry; Climate, Energy and Mobility; and Food and Natural resources. The clusters are derived from specifically commissioned foresight input, including from stakeholders, and have the Sustainable Development Goals as main reference point. The clusters and their intervention areas are expected to have more impact since they cut across classical boundaries between disciplines and address different types of challenge. The integrated clusters of activities will form the basis for support to collaborative research and innovation projects under the Global Challenges and Industrial Competitiveness pillar in the implementation of the Framework Programme.  Table 1: Clusters and intervention areas |

·Pillar 3 – Open Innovation: Whilst innovation will be supported throughout the whole Programme, an innovation-focussed pillar will offer a one-stop shop for high potential innovators with the European Innovation Council (EIC). The EIC will offer a coherent, streamlined and simple set of support actions dedicated to the emergence of breakthrough ideas, the development and deployment of market-creating innovations and scaling-up of innovative enterprises. These activities will be largely defined "bottom-up", being open to innovations from all fields of science, technology and applications in any sector, while also enabling focused approaches on emerging breakthrough or disruptive technologies of potential strategic significance. Additional measures under this Pillar will boost support to the European innovation ecosystem, notably through co-funding various joint national initiatives that boost innovation (e.g. joint programme between agencies implementing national/local innovation policies, joint public procurement actions). In addition to the EIC, financial instruments implemented under the InvestEU programme will help bridge the “valley of death” between research and commercialisation, and will support the scaling-up of companies. The European Institute for Innovation and Technology (EIT) and its Knowledge and Innovation Communities (KICs) will have an important role in the Open Innovation pillar, supporting the development of the European innovation ecosystem through the integration of education, research and entrepreneurship. Through their focus on key strategic priorities in line with the strategic programming of the Framework Programme (see section 4.1), KICs will also contribute to the wider programme objectives, including to deliver on global challenges and missions.

In addition to the three main pillars, the Horizon Europe will strengthen the European Research Area through successful elements of Horizon 2020 that will be integrated: (i) Sharing excellence (extending the Horizon 2020 Spreading Excellence and Widening Participation actions Teaming, Twinning, ERA chairs, and COST) to continue supporting low performing R&I Member States to increase their excellence; (ii) Reforming and enhancing the European Research Area, covering the Policy Support Facility; foresight activities; Framework Programme’s monitoring, evaluation, dissemination and exploitation of results; the modernisation of European universities; and Science, society and citizens (building on the Horizon 2020 Science with and for Society).

The redesigned pillar structure will improve internal coherence, in particular through:

-the integration of industrial technologies in Pillar 2, enhancing the contribution of industry to tackling global challenges, and matching supply with demand for new solutions
[70](#footnote71)
;

-the rationalisation of the current Societal Challenges into five cross-theme clusters that will cover the whole innovation chain and that will encourage transdisciplinary activities, including social sciences and humanities (SSH);

-the streamlining of different innovation support instruments through the EIC;

-the link of the EIC to the other activities of Horizon Europe, in particular ERC, MSCA and the EIT-KICs, to help researchers and innovators to deploy their innovation to the market and scale up.

-emphasis on a strong horizontal role of education and training.

Box 6Error! No sequence specified.: The reinforced role of industry in Horizon Europe – Industrial Competitiveness

|  |
| --- |
| Strengthening the Union's scientific and technological bases and encouraging it to become more competitive, including in its industry, is an objective enshrined in Article 179 of the Treaty on the Functioning of the European Union. The Union and its Member States support industrial competitiveness by speeding up the adjustment of industry to structural changes, encouraging a favourable regulatory environment, encouraging an environment favourable to cooperation and fostering better exploitation of the industrial potential of policies of research and innovation (Article 173 of the Treaty on the Functioning of the European Union).  Horizon 2020 supports industrial competitiveness, as highlighted by the following facts:  ·A 20% target exists for the total combined budget to be awarded to SMEs under the "Leadership in Enabling and Industrial Technologies" and "Societal Challenges" parts of Horizon 2020. By the end of 2017, this has been exceeded with almost 25% of the EU contribution awarded to SMEs [71](#footnote72) .  ·Private for-profit companies have been awarded 27% of the overall Horizon 2020 budget, amounting to EUR 6.7 billion.  Building on the strong support to stimulating industrial leadership and competitiveness currently provided, which will continue (e.g. the single funding rate for industry participants, partnerships with industry), the following changes in the new Framework Programme will reinforce it:  ·The whole Programme will contribute to industrial competitiveness. This reflects the overriding aims of the Programme, in which industrial technologies reinforce scientific knowledge and tackle global challenges; in which industry, academia, public stakeholders, citizens and their associations (CSOs) are brought closer together; and which seamlessly supports the whole innovation ecosystem from research to innovation and market deployment.  ·Industry is a core enabler to solve Global Challenges. Integration of the Leadership in Enabling Industrial Technologies programme parts, previously under the second pillar in Horizon 2020 ('Industrial Leadership'), within the Global Challenges and Industrial Competitiveness pillar would provide a higher visibility to the role of industry in solving Europe's major societal challenges, for instance through Key Enabling Technologies.  ·The "Digital and industry" cluster will be dedicated to support innovative, sustainable and digital industries, including through Key Enabling Technologies for the future. This cluster is expected to address directly the issue of slow industrial transformation and promote adjustment of industry to structural changes.Partnerships with industry will continue. EU policy-driven R&I partnerships with industry are important for pooling resources in order to tackle big policy and societal challenges, to support competitiveness and jobs and to encourage greater private investment in research and innovation, amongst other things. Public-private collaboration with industry will continue as part of a simplified and more impact-focussed approach to European Partnerships (see section 3.2.5 below).  As a result, the expected implications for industry are:  ·Europe’s global leadership in various industries, especially in high value added and technology-intensive products and services, will hinge on its capacity to master the Key Enabling Technologies, in which the Framework Programme will continue to invest.  ·Investing in new technologies through the Programme will enhance EU's industrial competitiveness in the global transition to circular and low-carbon economy, create new business opportunities including in export markets, and protect businesses against scarcity of resources or volatile prices.  ·A broader perspective involving users and society at large (and more generally the demand side) in the design and development of innovative solutions to address global challenges will ensure ownership and commitment from industry and other stakeholders, as well as the buy-in from civil society.  ·Bringing together activities on digital, key enabling, clean and space technologies, the Programme will allow for a more systemic approach, and a faster and more profound digital and industrial transformation. |

In terms of design structure, some stakeholders
[72](#footnote73)
 have identified the risk that merging the stand-alone “industrial leadership” pillar would discourage industry participation. On the other hand, a higher participation of industry in the Global Challenges and Industrial Competitiveness pillar could be seen as giving the private sector a disproportionate role in setting the R&I agenda at the expense of other stakeholder groups. As a mitigation measure, the strategic planning process (see section 4.1), building on the lessons learnt from the inclusive programming process of Horizon 2020, will ensure a balanced approach by involving all stakeholders, including citizens, customers and end-users in agenda-setting. The Programme will also gain flexibility by a less prescriptive approach to defining R&I activities. This brings about a higher capacity to adapt to evolving political priorities and to respond to emerging, unforeseen challenges.

Box 7: Climate mainstreaming

|  |
| --- |
| Horizon 2020 legal basis provides a target of investing at least 35% of its budget for climate-related activities. The EP has asked for a thorough climate mainstreaming and underlined that the EU should not finance projects and investments that are contrary to the achievement of EU climate goals [73](#footnote74) . The European Court of Auditors recommends aligning EU spending and investment more closely with the Union's strategic priorities [74](#footnote75) . 14 Member States have signed a joint letter to the Commission on 5 March 2018 asking for a climate-friendly EU-budget. [75](#footnote76)  Horizon 2020 is a major contributor to the EU’s target to mainstream climate action and sustainable development. While the expenditure target for climate action has not been met, the overall success of the mainstreaming approach has been confirmed by the Commission in the MFF Mid-Term Review [76](#footnote77) , in the European Court of Auditors Special report 31/2016 [77](#footnote78) , in the related council conclusions [78](#footnote79) , and by a targeted external report [79](#footnote80) .  The EU has signed up to the Paris Agreement on fighting climate change, and has already set itself a target to reduce greenhouse gas emissions by at least 40% by 2030. It also made wider energy transition commitments as captured in the Energy Union and its implementation packages, such as the the European Strategy for Low-Emission Mobility [80](#footnote81)  and the Clean Energy For All Europeans package [81](#footnote82) .  In continuation with the provision set out in Horizon 2020 and line with the EU’s international commitments, an ambitious goal for climate mainstreaming across all EU programmes has been set, with a target of 25% of EU expenditure contributing to climate objectives. To ensure its essential contribution to these objectives, Horizon Europe will continue contributing to climate action, including to clean energy transition in the EU. The programme is expected to contribute with 35% of its budget spent to climate objectives. |

3.2Improvements and their expected implications

In addition to the structure optimisations described in section 3.1, the key areas for improvement identified by the Horizon 2020 Interim Evaluation (see section 1.2) have been translated into novel features and enhancements of existing features. These improvements build on the foundations of the interim evaluations
[82](#footnote83)
, findings of High Level Groups
[83](#footnote84)
 and the work of scientific experts
[84](#footnote85)
. They were developed on the basis of analysis detailed in the Annex 8, from among identified alternative ways to address the key challenges identified in section 2.2.

The significant improvements linked to the design of the programme (see 
[Figure 5](#_Ref505781848)
) will be covered in this section, along with their expected implications. While Horizon 2020 is already excellent, impactful and open, these changes will make the Framework Programme achieve even more impact (EIC and missions) and more openness (through strengthened international cooperation, reinforced Open Science policy, and a new policy approach to European Partnerships). Neither of these changes goes beyond what is necessary at EU level (proportionality test), and each one aims to increase the overall effectiveness, efficiency and coherence of the Programme (see Section 3.3 for an overview of how this is achieved). More details can be found in Annex 8, which also covers more gradual changes, e.g. linked to Sharing excellence.

Moreover, the lessons learnt linked to simplification have been taken up in the section on delivery for impact (Section 4 and Annex 9), while those related to synergies with other EU programmes were included in the upstream design of those programmes (see Annex 7).

Figure 5: Design improvements and novelties in the new Framework Programme

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_07007.jpg)

3.2.1The European Innovation Council (EIC) 

Why do we need it? There is a growing lack of equity funding for risky companies dealing especially with deep-tech products, in particular young, innovative firms and scale-ups in Europe. According to a recent study
[85](#footnote86)
, the total equity funding gap in Europe is estimated at EUR 70 billion, of which 85% is represented by the so-called “first valley of death”
[86](#footnote87)
. The European Investment Bank estimates
[87](#footnote88)
 that it would require around EUR 35 billion a year in additional venture capital for financing start-ups and growth-stage firms in the EU to match comparable US levels. Private investors are deterred by the lack of certainty, no cash flow generation, and unproven ability to scale-up rapidly. Such ventures need a sophisticated support ancillary to a grant, such as equity, guarantee, or other type of financing (tailor made blended finance, see section 4.5) to better de-risk them and bring them to a stage where they can be financed on usual commercial terms by investors.

What do we have now? Horizon 2020 provides some measures of targeted support to disruptive technologies and to innovative companies for bringing discoveries close to the market, with a quarter of Innovation Actions having breakthrough potential
[88](#footnote89)
. On the one hand, the FET instrument supports high-risk cutting-edge research projects aiming to bring about transformational change by opposition to incremental innovation. However it lacks an instrument to bring these disruptive innovations to the market. On the other hand, the SME Instrument focusses especially on product, performance, business model innovations and market uptake, but much less on service, network, and customer engagement innovations and does not provide for market deployment and scale-up. In Horizon 2020, the SME Instrument has provided EUR 1,332 million in grants to 3,239 SMEs supporting the technical and commercial feasibility of a business idea and the development of innovation with demonstration and scale-up purposes. Majority of the projects emerging from receiving SME Instrument grants are however still exposed to the "first valley of death" for their subsequent development, which is not covered by the SME Instrument. These projects still have investment requirements to fully develop and commercialise their products
[89](#footnote90)
. Overall, Horizon 2020 does not provide enough support to innovators, and in particular SMEs, to develop breakthrough technologies cutting across sectors to access market and scale up rapidly at EU level.

What did the other EU institutions say? The European Parliament stresses the importance of innovation support in general, and of disruptive innovation and scaling up in particular. Council Conclusions emphasise the importance of supporting the whole innovation value chain, including high-risk disruptive technologies, while the possible future EIC should support breakthrough innovations and the scaling up of innovative companies
[90](#footnote91)
.

|  |
| --- |
| The majority of stakeholders commenting on the EIC are supportive and provide suggestions on its possible role, objectives and implementation. In general stakeholders expect the EIC to simplify the current support to innovation and act as an European accelerator. They note that the support to innovative SMEs and start-ups is essential to maximise Europe’s potential for growth and socioeconomic transformation [91](#footnote92) . |

What changes? The Framework Programme will introduce the EIC under the Open Innovation Pillar to place the EU in the lead for breakthrough market-creating innovation
[92](#footnote93)
. The EIC will support innovators with breakthrough ideas and market creating innovations that currently face high risks due to the fragmentation of the innovation eco-system, lack of risk finance and risk aversion
[93](#footnote94)
. The EIC will integrate, reorganise and expand activities previously carried out in Horizon 2020, such as in Access to Risk Finance (in synergy with the InvestEU programme), Innovation in SMEs (notably the SME instrument), Fast-track to Innovation as well as Future and Emerging Technologies (FET-Open).

The EIC will mainly implement two complementary instruments, offering a seamless support from research and innovation activities to market deployment and scaling-up of innovative companies. The Pathfinder for advanced research will be a grant-based instrument for early stage research on technological ideas that can bring about transformational change, to nurture spin-offs and potential market creating innovations. The Accelerator will be a financial instrument operating through tailor made blended finance (advances, reimbursable or not, equity, guarantees; see also section 4.5) in support of the development and the deployment of market-creating innovation and the scale-up of innovative companies, until they can obtain support from the InvestEU programme or be financed on usual commercial terms by private/commercial investors. The Accelerator will place a particular emphasis on innovations / spin-offs / start-ups generated within the Pathfinder, as well as from any other parts of the Programme such as the ERC, the EIT KICs and R&I missions. In de-risking the operations it supports, the Accelerator will also stimulate private investments in R&I while preserving competition in the internal market.

EIC business advisory services will complement these instruments in order to connect innovators with industrial partners and investors and provide them with other support services. A High-Level Advisory Board composed of entrepreneurs, corporate leaders, investors and researchers, will assist the Commission in the governance and have an outreach function with an ambassadorial role. For its launch, the EIC could be implemented with the support of an executive agency for some tasks. Subsequent development may however lead to establishment of a fully externalised solution, as one of the possible implementation scenarios (see Annex 8).

What is the EU added value? As for the Horizon 2020 Future Emerging Technologies and the SME Instrument, the continent-wide competition for ideas will ensure excellence and EU-gains. Moreover, only EU-level action has the capacity to tackle the persistent lack of large-scale venture capital. EU support will be more effective and more comprehensive (e.g. common regulation, fostering synergies with other EU programmes) compared to national or regional support. The EIC will focus on breakthrough innovations at European level, pooling resources and unleashing the potential of European and global markets for EU innovators
[94](#footnote95)
. The EIC will not replace national and private initiatives fostering breakthrough innovation, but instead it will increase the coherence of the overall innovation ecosystem by establishing a one-stop shop for high potential innovators and partnerships with national, regional and local innovation actors.

Figure 6 EU support to innovation (bottom-up and top-down)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_07008.jpg)

Table 2 Comparing the EIC with the ERC, EIT, and InvestEU

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  | European Innovation Council (EIC) | European Research Council (ERC) | European Institute for Innovation and Technology (EIT) | InvestEU |
| Key principles | Focus on excellence (attract best innovators) based largely on bottom-up approach, but also high-risk, breakthrough R&I activities that create markets and provide solutions to global challenges. | Focus on excellence (attract best researchers), based on bottom-up approach | Focus on knowledge triangle integration (education, research and innovation) that empowers innovators and entrepreneurs to solve global challenges through KICs | Focus on bankable projects, and expected return on investment. Implemented, through financial intermediaries (Banks, Venture Capital Funds, and other private investors) |
| Target group | Focus on the individual (the innovator), with high-growth potential (researchers, entrepreneurs, start-ups, SMEs and mid-caps), from single beneficiaries to multi-disciplinary consortia, but promote their incorporation and growth under late stage activities | Focus on the individual (the researcher) | Focus both on individual entities and on cooperation of businesses, education institutions & research organisations within KICs | Focus on entities that can borrow money or can sell shares. |
| Rationale | Remove constraints (field of innovation) for growth and scale-up | Remove constraints (field of science, collaboration partners) | Reinforce  R&I ecosystems in specific areas (knowledge exchange and networks, entrepreneurship, skills); support innovators to start and accelerate new businesses; provide talent through entrepreneurial education | Leveraging private sources of finance.  Address market gaps and sub-optimal investment situations. |
| Evaluation and Selection | Selection by peers (scientists and innovators) and investors based on excellence, the impact (marketability), and the level of risk | Selection by scientific peer review | Selection of KICs by EIT Governing Board; KICs business plans (i.e., innovation and education activities, projects) assessed by panel of experts appointed by EIT | Selection by financial intermediaries through due-diligence process. |
| Types of Action | Grants (Pathfinder) and combination of grant-type advances and equity or financial guarantees (Accelerator).  Projects may be amended or terminated if milestones are not met, seeking alignment with private investors | Long-term grants with guaranteed funding | Grants to KICs partnerships + complementary activities (incl. education & entrepreneurial  programmes) | Equity finance, mainly focusing on risk-capital funds and debt finance in the form of loans and guarantees. |

What are the risks? Firstly, in giving priority to potential impact rather than return on investment, the EIC will promote long-term operations too risky to attract private investors. In recent years, these risks have increased due to the more multi-disciplinary nature of R&I and the intrinsic complexity and systems nature of many emerging technologies. If the risk of failure of projects under the EIC is more pronounced, even higher is the potential benefit of generating new markets that are essential for the future of the Union and its citizens, e.g. deep-tech based areas of future growth and jobs such as clean and efficient new energy sources, block-chain, artificial intelligence, genomics and robotics. Secondly, there is a potential risk of conflict of interest linked to the involvement of experts, which will also be innovators and/or investors themselves. Safeguards will be put in place, for example by preventing them to invest into EIC supported companies, or similar provisions.

Box 8: EU Added Value of mono-beneficiary instruments

|  |
| --- |
| The Horizon 2020 interim evaluation showed that the quality of R&I improves through EU-wide competition. This is an important element of EU added value, notably in areas where mono-beneficiaries are the norm, like the SME Instrument and the ERC. The EU added value of the ERC from its exclusive focus on excellence through competition helped it become a global beacon of excellence. Similarly, an in-depth evaluation study of the SME Instrument [95](#footnote96)  positively assessed its EU Added Value: it is unique compared to similar support schemes at national/regional level (which are only focusing on certain priority domains; do not have rolling submissions; have significantly smaller project volumes; require project collaboration with other SMEs or universities). |

What are the expected implications?

|  |  |
| --- | --- |
|  | ·More innovations that create the new markets of the future. Giving more prominence and visibility to breakthrough innovation, the EIC will attract the Europe’s best innovators. The selection process by peer-scientists and innovators and investors will enable risk-taking, hence providing support to radically new initiatives in uncharted territories. The EU could become the home of up to a third of leading innovators in major areas for breakthrough deep tech innovation [96](#footnote97)  such as Artificial Intelligence, biotech, and augmented/virtual reality and to leading innovators addressing global challenges. |
|  | ·Scaled up companies and higher SME growth. The EIC will support late stage innovation activities and market deployment for the most promising ideas, resulting in an increase in the number of growing EU start-ups and SMEs. The EIC will also target innovative companies with a great potential for scaling up, offering them co-investment to become larger and increase their markets. The support to innovative companies and in particular SMEs will increase their market valuation, employment, and turnover. |
|  | ·Increased complementarities between grant-type funding, financial instruments, and leverage from private investment. Under the Accelerator, blended finance will allow the Union to bear the initial risk of deploying market breakthrough innovations, with the aim of de-risking these operations as they unfold, down to a stage where they can be financed through private capital, hence incentivize private investors. Combined with activities undertaken by the (InvestEU Programme) this alignment of interests with private investors will provide improved access to venture capital and risk finance, hence leveraging the overall volume of finance available for innovation.. |
|  | ·More entrepreneurship and risk-taking. The EIC will provide business acceleration services to innovators and will award EIC Fellowships to the outstanding ones. The EIC will highlight innovators who can inspire others to set up and grow their own enterprises. |
|  | ·More accessible and user friendly support to innovation. The EIC support and services will be provided through a one-stop shop enabling easy and quick access for innovators to EU support. |

3.2.2Research and Innovation Missions

Why do we need it? As underlined by the Interim Evaluation of Horizon 2020
[97](#footnote98)
, the current EU research and innovation programme does not fully prioritise investments with the highest overall impact and added value for Europe, as expected impact is defined only at the level of individual call topics. This leads to fragmentation and a dilution of impact. The consequent lack of focus on societal impact also results in a low level of public awareness and engagement in EU-funded R&I. This implies that current EU investments in R&I are not sufficiently responsive to, or connected with, the needs of citizens.

What do we have now? Horizon 2020 featured over 20 Focus Areas in key domains, where priorities cut across different parts of the programme (e.g. blue growth, circular economy, digital security), to concentrate resources and efforts. While focus areas reinforced the programme's coherence and its capacity to provide interdisciplinary solutions to multiple societal challenges, their multiplication also resulted in some confusion. Moreover, citizens were not involved in the process, and limited coordination of the focus areas undermined their impact. Nor did they set achievable and time-bound goals.

What did the other EU institutions say? All EU Institutions stress the importance of involving citizens more profoundly in the co-design and co-creation of R&I contents to maximise the impact generated by the Framework Programme
[98](#footnote99)
. The European Parliament recognises the importance of society playing a more active part in defining and addressing the problems, and in jointly putting forward the solutions. The Committee of the Regions is calling for the adoption of a new, complementary approach based on missions and for greater importance of science-society actions. The European Economic and Social Committee calls for increased involvement of Civil Society Organisations in the Framework Programme. The Council Conclusions and the European Research Area and Innovation Committee (ERAC) point to the need to deliver better and continued outreach to society, and call for exploring a mission-oriented approach
[99](#footnote100)
.

|  |
| --- |
| Almost all stakeholders referencing R&I missions clearly supported mission-orientation of Horizon Europe or acknolwedged it as a possible future scenario. In general, stakeholders consider that tangible missions that underpin the overall political objectives could enhance visibility and create a more engaging narrative of the Framework Programme. There is also a widespread acknowledgement on the need to engage wider society in identifying the most relevant missions within broader societal challenges.  [100](#footnote101) |

What changes? Horizon Europe will introduce a limited number of highly visible R&I missions. Missions will replace and build on the Horizon 2020 Focus Areas. They will be well-defined
[101](#footnote102)
 and self-standing programme parts, as opposed to the Focus Areas. This will more clearly and directly incentivise cross-sectoral and cross-disciplinary cooperation. Clear objectives and rationale will be established at the mission's inception (addressing a specific weakness identified in the focus areas approach) in order to define targets, clear time-bound goals and expected impact. Finally, missions will be more closely co-designed with end-users and citizens, thus prioritising public engagement and involvement and "building upon existing work and prior commitments to bring societal actors together to prioritise R&I activity"
[102](#footnote103)
.

Different types of missions can be envisaged, for example missions to accelerate progress towards a set technical or societal solution, focusing large investments on a specific target (e.g. accelerate market uptake of post Li-ion energy storage solutions) or missions for transforming an entire social or industrial system within an established timeframe (e.g. transformation of the entire energy system or mobility system in cities). Evidence indicates that a combination of approaches would be most suited to the scale of EU-level missions and the complex challenges which they will address
[103](#footnote104)
.

Missions will be selected (after the launch of Horizon Europe) according to the following selection criteria
[104](#footnote105)
:

·Bold, inspirational, with wide societal relevance;

·A clear direction: targeted, measurable and time-bound;

·Ambitious but realistic research and innovation actions;

·Cross-disciplinary, cross-sectoral, and cross-actor innovation;

·Multiple bottom-up solutions;

·Strong EU added value.

At the implementation stage, Mission Boards for each mission will ensure proper involvement of stakeholders and end-users. Mission Boards will be involved in co-designing the missions involving stakeholders and the wider public, providing input to the content of the call for proposals and the evaluation of project proposals and in monitoring missions. A mission manager will be appointed for each mission with the task of ensuring that the mission objectives are reached through a portfolio approach. By involving citizens and stakeholders in the definition, selection and monitoring of missions, a sense of urgency and collective commitment will be created
[105](#footnote106)
 while also ensuring societal ownership of the missions 
[106](#footnote107)
.

What is the EU added value? Setting R&I missions at EU level gives them the critical mass necessary to address global challenges. They will help the EU to better deliver on Sustainable Development Goals and its strategic policy priorities. Setting R&I missions at EU level would also facilitate ensuring that the EU regulatory framework fully supports the achievement of such an EU mission, for instance through applying the innovation principle, setting standards at EU level, or through joint public procurement at EU level. Missions can involve end-users and citizens much more closely in EU R&I activities.

What are the risks? The success of missions hinges on the timely and due dialogue with stakeholders, to avoid disengagement or weak interest. Moreover, in the implementation phase, the evaluation and monitoring mechanisms will need to be sophisticated enough to capture the long-term impacts of missions. Finally, the ultimate uptake and roll-out of innovative solutions arising from missions will depend on wider framework conditions – this kind of wider support to uptake can be supported through policy actions in the spirit of the Inovation Principle, or through Innovation Deals
[107](#footnote108)
.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Improved cross-sectoral and cross-disciplinary cooperation. Missions will require expertise from different sectors and disciplines to come together. For example, climate action requires meaningful collaboration across sectors such as urban planning, construction, energy efficiency in buildings, mobility, behavioural aspects, food, environmental capacity, and in many other areas. The mission-oriented approach will work across clusters to promote system-wide transformation. |
|  | ·Increased impact on global challenges and EU policy priorities. Missions will increase effectiveness in delivering societal impact for end-users and citizens, by prioritising investments and set directions to achieve objectives with societal relevance. Missions will set the direction for the EU regulatory framework, and leverage further public and private sector R&I investments in Europe. |
|  | ·Reduced gap between science/innovation and society. R&I missions will be easy to communicate, in order to mobilise citizens and end-users in their co-design and co-creation (e.g. through citizen science and user-led innovation). In turn, this increases the relevance of science and innovation for the society and it would stimulate the societal uptake of innovative solutions and leverage business investment. |

3.2.3International cooperation

Why do we need it? International cooperation in R&I is vital for ensuring access to talent, knowledge, know-how, facilities and markets worldwide, for effectively tackling global challenges and for implementing global commitments
[108](#footnote109)
.

What do we have now? Association to the programme is limited to countries geographically close to Europe. Organisations from non-associated third countries can participate in projects in all parts of the programme, except for mono-beneficiary grants, specific close-to-market innovation activities and actions for access to risk finance. Except for a few cases, only participants from low- and middle-income countries are automatically eligible to receive EU funding. EU funding can be exceptionally granted to third-country entities whose participation is deemed essential for carrying out an action. 

What did the other EU institutions say? The Council and the European Parliament have called for strengthening international R&I cooperation in the Framework Programme, including with associated countriesand emerging countries, as soon as possible through concrete actions. The Parliament, in addition, has highlighted the value of science diplomacy. Council Conclusions have also reaffirmed the importance of reciprocity.

|  |
| --- |
| A predominant view among stakeholders is that cooperation should be strengthened to counter the drop in internationalisation activities and participation rates from third countries that was experienced in Horizon 2020.   Some stakeholders also advocate science as a platform for international diplomacy. A few stakeholders noted that EU could adopt legislation to encourage exploitation of research and innovation results in Europe first [109](#footnote110) . |

Figure 7: Approach to international cooperation in Horizon 2020 vs the new Framework Programme

|  |
| --- |
|  |

What changes? The Framework Programme will intensify cooperation in line with the strategy for EU international R&I cooperation and the "Open to the World" R&I priority
[110](#footnote111)
. The programme will extend openness for association, beyond EU enlargement, EEA countries and ENP countries, to include all countries with proven science, technology and innovation capacities to make cooperation and funding of joint projects as smooth as possible. The programme should increasingly invite partners from the rest of the world to join EU efforts as an integral part of initiatives in support of EU actions for sustainable development; it should provide more support for activities that facilitate the collaboration of European researchers with their counterparts worldwide, enable international mobility of researchers and ensure access to research infrastructures globally; and it should extend support to joint and coordinated funding of global industrial research and innovation cooperation. The programme should continue to fund entities from low-mid income countries, and to fund entities from industrialised and emerging economies only if they possess essential competences or facilities. The programme will intensify support to international flagships, partnerships, bilateral and multilateral initiatives and joint programmes and calls, to increase access to researchers, knowledge and resources worldwide and optimise benefits from cooperation.

Box 9: Third Countries associated to the Framework Programme

|  |
| --- |
| ·The Framework Programme will define which countries will be able to apply for association, what criteria should be used to assess their applications, and what principles should apply for the terms and conditions regarding their participation.  ·Each Association Agreement to the Framework Programme should define the scope, specific terms and conditions of participation, as well as the rules governing the financial contribution of the associated country. These rules should ensure a close approximation between payments and returns. |

What is the EU added value? Openness of the Framework Programme to third countries enhances the EU added value of the Programme itself, allowing EU participants to collaborate with the best minds in the world. The EU can more effectively shape policy agendas when represented as a single voice in multilateral fora and international organisations. The EU has a comparative advantage as compared to single Member States when negotiating bilateral agreements with third countries regarding framework conditions such as mutual openness of funding programmes or issues related to Intellectual Property Rights (IPR) protection. Thanks to the Framework Programme, Member States are enabled to cooperate with several third countries, including countries with which they do not have bilateral agreements. Increasing international cooperation does not go beyond what is necessary to achieve the objectives of the programme.

What are the risks? The main risk is that the proposed specific objective, priorities for actions and instruments to be used will not be sufficient for strengthening international cooperation in the Programme compared to the current situation. Regarding the process, there is also the risk that European objectives both in terms of global challenges and competitiveness take less of a driving role in priority-setting when more international partners are involved. International S&T cooperation policy dialogues and broad consultations should ensure that international joint actions are strategically designed in line with EU interests and agreed with international partners based on mutual interest and common benefit.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Improved excellence of the Programme. Attracting and collaborating with the world's top researchers, innovators and knowledge-intensive companies reinforces the EU’s science and technology base. Evidence shows that international collaboration increases the impact of scientific publications [111](#footnote112) . |
|  | ·Higher influence of the EU in shaping global R&I systems. This approach will enhance the EU leading role in setting the policy agenda, in particular for addressing common challenges and for achieving the Sustainable Development Goals. The mutual benefits of international cooperation strengthen EU leadership in the knowledge-intensive economy. The Programme will be an effective instrument in Europe's efforts to harness globalisation by removing barriers to innovation and by establishing fairer framework conditions with international partners. |
|  | ·More impact from the Programme. Increased international cooperation will reinforce EU R&I excellence and the creation and diffusion of high-quality knowledge in the EU. Cooperating internationally is indispensable as the scope and interconnectivity of global societal challenges increase and require more international joint action and coordination of agendas International openness of the innovation eco-systems will strengthen EU competitiveness by promoting a level playing field and enhancing supply and demand of innovative solutions. The association agreements with countries having proven R&I capacities will facilitate mutual access to European and third-country know-how and markets, as cooperation with top third country innovators facilitates access to expertise that is increasingly developed outside the EU. |

3.2.4Open Science policy

Why do we need it? The next Framework Programme should fully embrace Open Science as a way of strengthening scientific excellence, benefiting from citizen participation, achieving better reproducibility of results and increasing knowledge circulation and the re-use of research data
[112](#footnote113)
, hence accelerating the take-up of R&I knowledge and solutions and increasing the EU policy and societal impact of the Framework Programme.

What do we have now? There is a shift towards a more open, collaborative, data-intensive and networked way of doing research and sharing research results, enabled by developments in ICT and related infrastructures and the increasing proliferation of data. Open access to publications is mandatory, while open access publishing is encouraged, and relevant costs eligible. Beneficiaries are encouraged by guidelines to keep enough (copy)right to self-archive, but are not legally empowered to do so. Participation in the Open Research Data Pilot is the default for Horizon 2020 projects, and it requires a Data Management Plan and open access to research data, but there are solid conditions to opt-out from the Pilot at any stage.

What did the other EU institutions say? The European Parliament opinion is in favour of the general principle of Open Access, while the European Research Area and Innovation Committee (ERAC) regards the 100% Open Access policy of Horizon 2020 as a clear measure in favour of knowledge circulation. Importantly, the Council Conclusions on the transition towards an Open Science System give valuable guidance for the future, while the Council Conclusions on the Interim Evaluation of Horizon 2020 highlight the role of Open Science in boosting impact and transparency
[113](#footnote114)
.

|  |
| --- |
| The majority of stakeholders who referred to Open Science note that data and knowledge produced from EU funded projects should be shared openly. However, some business representatives underlined the need for the opt-out option to be maintained to secure confidentiality of market-oriented innovation outputs. Stakeholders also highlight that open science, open data and open access calls for new principles in citation and academic reward system and requires attention to the development of skills in research data management   [114](#footnote115) . |

What changes? The Framework Programme will fully embrace and support Open Science policy as the new research modus operandi through various requirements in the Work Programmes. It will go beyond the open access policy of Horizon 2020, requiring immediate open access for publications and data (with robust opt-outs for the latter), and research data management plans to support sound data management; it will foster the proliferation of FAIR data (findable, accessible, interoperable and re-usable). It will support activities that promote a sustainable and innovative scholarly communications ecosystem; it will foster activities for the enhancement of researcher skills in open science and support reward systems that promote open science; it will integrate research integrity in the open science activities and support citizen science. Lastly, it will also support the introduction of next generation indicators for the assessment of research.

What is the EU added value? Even while Member States are developing their own policies for Open Science, the positive effect of EU action is substantial
[115](#footnote116)
. Horizon Europe will contribute towards policy alignment across the Member States and thus towards the development of a better and more unified environment for research collaboration in ERA and beyond it. Requirements of the Programme have structuring effects that accelerate the propagation of Open Science policy via collaborative projects in the research community. Horizon Europe will accelerate the transition towards Open Science by building a European Open Science Cloud supported by world-class infrastructure that will gradually also benefit industry and the public sector.

What are the risks? The main concern on Open Science in Horizon Europe relates primarily to the requirement for open access to data from research projects. Without clearly explained safeguards, this policy could be perceived as deterrent for industry and businesses to participate. This is why, while open access to research data will be the standard, Horizon Europe will be fortified with robust exceptions to this rule, where access to data needs to be protected and Intellectual Property Rights protected. The principle that research data has to be 'as open as possible, as closed as necessary' will be emphasised every time it is necessary. A concern shared also at the time of Horizon 2020 is that the development of open access in Europe may offer content paid by European taxpayers for exploitation to the entire world, and therefore advantages other countries for more severe competition in research and innovation. The Commission is not the only funder with such open access and open science policy requirements. Funders across the globe are aligned in mandating open access to publications and data and relevant open science policies. It is not expected that Europe will set itself into a comparative disadvantage in this way, vis-à-vis other countries across the world.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Increased availability of scientific output in open access. A higher percentage of projects will make their outputs (publications, data, algorithms etc.) available in open access because of the simplification of provisions, the stricter formulation of exceptions, and financial support provided through the Programme. |
|  | ·Higher levels of excellent research and innovation. Placing high quality content in the open, and stimulating knowledge circulation and the reuse of results, improves science communication and enables interdisciplinary research. |
|  | ·Increased accessibility to high quality digital content. Data are increasingly becoming the starting point for innovation, with high returns [116](#footnote117) . With digitisation, it can be expected that SMEs and other companies will base new business models on digital content, hence will reap the benefits of a strengthened Open data environment in Europe and maximise the exploitation of digital resources through reusability. |
|  | ·Higher societal and policy impact. Open science policy allows citizens to be part of the research process (for example through citizen science), helping lifelong learning and developing an informed society for the 21st century challenges. Accessible R&I data and results can be used for evidence-based policy-making, therefore they contribute to strengthening the policy role of R&I. |

3.2.5European Partnerships

Why do we need it? The European R&I partnership landscape grew significantly in size and complexity over the last decade with an increasing risk of overlap and non-coherence with the EU framework programme and between the partnerships themselves. In particular, there is a large number of Public-Public Partnership initiatives (currently close to 100). Still, Partnerships are key to achieving policy objectives that the Framework Programme alone cannot achieve. Reforming the current partnership landscape and improving the design and implementation of future European Partnerships, renewed or newly set-up, should make it possible to use their full potential in achieving ambitious policy objectives.
[117](#footnote118)

What do we have now? Horizon 2020 supports two broad categories of partnerships: those mainly involving industry, i.e. Article 187 initiatives or Public-Private-Partnerships (PPPs) and contractual PPPs (cPPPs); and those involving mainly Member States, i.e. Article 185 initiatives or Public-Public-Partnerships (P2Ps), ERA-NET Cofund, European Joint Programming-Cofund and Joint Programming Initiatives. Moreover, there are other types of mixed partnerships such as the Knowledge and Innovation Communities (KICs) of the European Institute of Innovation and Technology (EIT) (integrating the knowledge triangle) and the Future and Emerging Technologies Flagships.

What did the other EU institutions say? The Competitiveness Council Conclusions stressed that the current R&I ecosystem has become too complex, and that all partnership initiatives should have an exit strategy from EU funding. The European Research Area and Innovation Committee (ERAC) considers it particularly urgent to rationalise the funding schemes, while considering public-to-public partnerships essential for more coordinated implementation of national and EU R&I. The European Parliament advocates ‘decomplexifying’ the EU funding landscape
[118](#footnote119)
.

|  |
| --- |
| A large share of stakeholders submiting position papers is concerned by the complexity of the EU R&I funding landscape. A dozen stakeholders explicitly emphasise the fact that exsisting support schemes should be carefully evaluated, and the discontinuation of funding should be an option (i.e. sunset clauses). [119](#footnote120) |

What changes? An overall European Partnerships strategy based on an objective- and impact-driven intervention logic will be developed and implemented in order to ensure that partnerships are established or renewed
[120](#footnote121)
 only in cases where impacts need to be created that cannot be achieved by other Framework Programme’s actions or national action alone. All future European Partnerships will be designed based on the principles of Union added value, transparency, openness, impact, leverage effect, long-term financial commitment of all the involved parties, flexibility, coherence and complementarity with Union, local, regional national and international initiatives.

The strategic planning process of the Framework Programme (see section 4.1) will frame the establishment of European Partnerships. This will ensure that the next generation of partnerships will support agreed EU priorities and will lead to a rationalised R&I landscape, with fewer, but more targeted initiatives receiving co-funding/investment from the Framework Programme.

The design and implementation of future European Partnerships will include an improved coherence between Framework Programme’s actions and R&I partnerships, as well as among initiatives. In addition, communication and outreach will be strengthened by a clear, easy-to-communicate architecture under the umbrella term “European Partnerships”. This encompasses all Partnerships with Member States, Associated or Third Countries and/or other stakeholders such as civil society/foundations and/or with industry (including small and medium sized enterprises), with greater openness to international cooperation. European Partnerships will only be developed on agreed EU policy priorities in the context of the Framework Programme, and subject to the criteria set out in the Framework Programme. They will be limited in time with clear conditions for phasing out from the Framework Programme funding. There will be only three types of intervention modes (i.e. several Horizon 2020 labels like P2P, PPP, ERA-NET, FET Flagship and cPPP will be discontinued): i) co-programmed European Partnerships between the EU, Member States, and/or other stakeholders, based on Memoranda of Understanding or contractual arrangements with partners; ii) co-funded European Partnerships, based on a single, flexible programme co-fund action for R&I activities; iii) institutionalised European Partnerships (based on Art. 185 or 187 TFEU, and EIT regulation for KICs). Following a life-cycle approach
[121](#footnote122)
 the legal act will set out the criteria for the selection, implementation, monitoring, evaluation and phasing out of all European Partnerships.

What is the EU added value? The main added value derives from the additional private and public R&I investments on EU priorities (additionality and leverage), the alignment of these investments towards common objectives (directionality) and the achievement of impacts that cannot be created by other Framework Programme actions or national action alone. In addition, the revised policy approach will substantially improve the coherence between European Partnerships and the Framework Programme in general, based on clear criteria identified together with Member States and other stakeholders. EU investments in R&I will be simpler to communicate and understand for stakeholders. The approach will build on, and bring together, all the on-going and future partnerships.

What are the risks? The major risk for the new policy approach is considered to be the expectations from the current partnerships to continue on a business as usual approach and expect more or less automatic renewal without being in line with the criteria set. It is crucial to ensure early involvement of Member States and stakeholders, including currently active initiatives, in the strategic programming process to build trust and ownership on the agreed future priorities.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Improved coherence and simplification. The clear rationale for the use of R&I partnerships, the elaboration of distinct and clear intervention logics based on policy objectives and the application of an impact-based criteria framework along the life cycle of R&I partnerships, including their phasing-out will guide the establishment of the next generation of partnerships. This will lead to a smaller number of more coherent partnerships and improve the overall coherence of the European R&I ecosystem. |
|  | ·More openness and flexibility. Partnerships will be open to all types of stakeholders (Member States, civil society/foundations, industry, including small and medium sized enterprises) with no entrance barriers for newcomers and smaller R&I players. Flexibility will be encouraged with a simplified toolbox, and a lifecycle-based planning and implementation approach. |
|  | ·Enhanced impact of EU R&I funding. The new approach to partnerships will ensure that partnerships will only be established in cases where desired impacts cannot be created by other Framework Programme’s actions. As EU co-funding will be limited to agreed EU strategic priorities, including EU R&I missions, the overall impact of EU R&I funding will be increased by leveraging additional investments on EU policy priorities, by providing 'directionality' to these investments, and by reaching out to a broader set of stakeholders. |

3.3Overall impact on the new Framework Programme

Impact is expected to be even higher than for the current Programme, because of improved programme-design novelties, increased internal coherence between Programme pillars, with more focus on cross-disciplinary, cross-sectoral and cross-policy activities, increased synergies with the MFF programmes, rationalisation, more user-friendly modalities, increased openness to all stakeholders, more flexibility and efficient delivery mechanisms, including a more effective dissemination and exploitation of R&I results.

The EIC which aims to capitalize on EU science strengths and improve transition from science to breakthrough innovation, (i.e. innovation with highest impact) is expected to be particularly effective in assisting companies along their innovation journey by offering innovators seamless support (from grants to blended finance, from early stage research to market uptake). Missions which aim to set ambitious goals and channel EU R&I investment to areas with highest added value (i.e. highest impact) would allow the Programme to deliver better on EU strategic challenges; support the implementation of EU policy priorities; improve the contribution to EU policy-making; increase cross-sector and cross-disciplinary cooperation; and improve the societal uptake of innovative solutions based on better communication with, and involvement of, citizens. Strengthening international cooperation would foster R&I by attracting even more of the world's top innovators, knowledge-intensive companies, scientific organisations and researchers. Strengthening open science policy should create and diffuse better high-quality knowledge, while better involving and informing citizens. The integrated approach for partnerships would improve leverage of, and alignment to, Member State and private investments.

Table 3: Effectiveness of the changes to the Programme

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Changes | Objectives of the Framework Programme | | | | MFF cross-cutting objectives | | | | |
|  | Support the creation and diffusion of high-quality knowledge | Strengthen the impact of R&I in developing, supporting and implementation EU policies | Foster innovation | Optimise the Programme's delivery for impact within a strengthened ERA | Simplification | Flexibility | Coherence | Synergies | Focus on performance |
| Structure | 0 | 0 | 0 | + | + | + | + | 0 | 0 |
| EIC | + | + | +++ | ++ | + | ++ | + | + | ++ |
| Missions | + | +++ | + | ++ | +/- | + | ++ | ++ | ++ |
| International cooperation | ++ | + | + | + | 0 | 0 | 0 | 0 | + |
| Open Science policy | ++ | + | + | + | 0 | 0 | + | 0 | 0 |
| Partnerships | + | ++ | + | ++ | ++ | + | + | + | + |

Note: +, ++, +++ correspond respectively to slight, moderate and significant improvement compared to a no-policy change scenario. +/- correspond to a coexistence of positive and negative impacts. 0 means no significant change.

Horizon Europe is expected to generate more substantial economic benefits. Compared to the baseline (Section 2.1), the improvements will increase the overall impact, with different possible scenarios depending on how R&I leverage, diffusion and economic performance will react to these changes. Illustrative results from the NEMESIS model
[122](#footnote123)
 (see Annex 5) show that the estimated GDP gains for the EU compared to the baseline can range from +0.04% in a low scenario to +0.1% in a more optimistic scenario (direct and indirect effect). The total impact of the Programme on EU GDP could range from EUR 30 billion to EUR 40 billion per year over 25 years (EUR 800 billion to EUR 975 billion in total)
[123](#footnote124)
.

Figure 8: Impact of the changes compared to the baseline (GDP gain, compared to a situation without Framework Programme)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_07021.jpg)

Source: Seureco, Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme.

Horizon Europe will deliver more value for money. 
[Figure 8](#_Ref513188021)
 shows that the future Programme is expected to generate even more economic benefits due to the improvements in the programme structure and design, which together with more delivery for impact (see section 4) will ensure that the Programme will be cost-effective.

Table 4 Economic costs and benefits of Horizon Europe

|  |  |  |  |
| --- | --- | --- | --- |
| Economic Benefits [124](#footnote125) | | Costs [125](#footnote126) | |
| Leverage of R&I investment | EUR 6-7 billion over 2021-2027 | Submitting proposals | Cost for beneficiaries: About EUR 650 million per year [126](#footnote127) |
| GDP gain | 720 to 975 billion over 25 years | Administrative burden (reporting obligations) | Cost for beneficiaries: EUR 0.9-2.3 million per year [127](#footnote128) |
| Employment | Direct benefit: Over 100 thousand jobs in R&I activities around 2027  Indirect benefit: Over 200 thousand jobs around 2035 | Management of projects and proposal evaluation | Cost for administrations:  EUR 500-600 million per year [128](#footnote129) |

Lastly, these effects will be amplified by strengthened synergies and complementarities with other EU Programmes (see Annex 7). This will entail for example stronger alignment of priorities; clearer complementarities; more flexible co-funding schemes to pool resources at EU level; common strategic planning processes to allocate funding; greater alignment between applicable rules; and eligibility of R&I high-quality proposals for funding by other EU programmes (e.g. Seal of Excellence, co-funded European Partnerships), stronger involvement of existing networks at EU level (e.g., the Enterprise Europe Network). Portfolios of R&I results will be made available for EU regions for potential uptake based on their specific needs, thus maximising the benefits coming from synergies with EU initiatives, for increasing regional competitiveness and innovation. This will maximise the impact of investments, speed up market uptake and the development of a comprehensive R&I ecosystem. Moreover, the Framework Programme will deepen links with EU policy priorities by bringing R&I results into policy-making, with full involvement of sectoral policy-makers.

Error! No sequence specified.Box 10: Market uptake

|  |
| --- |
| Improving market uptake of innovative solutions is a broad concept encompassing various activities, which help R&I-driven innovation to succeed on the market and create new value for market players and consumers/citizens alike. However, market uptake goes beyond R&I. Therefore, activities under the Framework Programme alone cannot suffice to incentivise broad market uptake and dissemination of innovative solutions. Other EU programmes need to also play a key role (see Annex 7 on Synergies).  What does Horizon 2020 currently do for market uptake?  ·Supports the development of innovative solutions until demonstrators and pilots (introduction of a first-of-its-kind innovation in the EU).  ·Speeds up the introduction of innovations on the market and supports coaching and mentoring of companies.  ·Provides support to closer-to-market activities, including the launch and scale-up of innovative companies, without distorting competition within the EU.  ·Supports public demand for innovative solutions, through Public Procurement for Innovation and Pre-Commercial Procurement. This support is limited to the coordination costs between procurers.  ·Develop standards for innovative products and services, but with limited progress so far.  What can the Framework Programme do more for market uptake?  ·Ensure market uptake is considered at the phase of proposal development, fostering applicants to co-create/experiment their research and solutions with users from the outset, to ensure improved fit to the final needs, including within the KICs co-location centres;  ·Support innovation actions and the demonstration of technological and non-technological innovative solutions of a first-of-a-kind nature in Europe with potential for replication;  ·Establish pipelines of innovative solutions (originated from R&I projects) targeted to public and private investors, including the EIC’s Accelerator and other EU programmes;  ·Support to roll out and replication of innovative solutions with cross-border and transnational dimension;  ·Support to pre-commercial procurement and public procurement of innovation is maintained;  ·Support with the EIC the deployment of market-creating innovations and the scale-up of start-ups, innovative SMEs and mid-capital firms with breakthrough potential to create new markets by blended finance of grants and financial instruments under the EIC;  ·Improved monitoring and dissemination of R&I results including through initiatives such as the Dissemination and Exploitation Boosters and the Innovation Radar – also directed to other EU programmes for further implementation  ·Support non-technological innovations (social innovation, business model innovation, public sector innovation etc.) including innovative delivery mechanisms.  ·Put in place a comprehensive go-to-market package to incentivise the exploitation of Framework Programme’s results by helping beneficiaries to find the most appropriate instruments and channels for the market uptake of their innovations.  ·Provide holistic support throughout the dissemination and exploitation lifecycle to ensure a constant stream of innovations stemming from the Framework Programme.  ·Put in place an ambitious and comprehensive dissemination and exploitation strategy for increasing the availability of R&I results and accelerating their uptake to boost the overall impact of the Framework Programme and the European innovation potential. |

3.4Critical mass

Achieving critical mass is key for the efficiency and effectiveness of the Programme
[129](#footnote130)
. Horizon Europe cannot work effectively if it is not able to fund a sufficiently broad portfolio of relevant technologies and a sufficiently large range of complementary R&I projects that can build on each other and contribute to the objectives of the Programme. Reaching critical mass means that the Programme should be able to fund projects large enough to bring together across countries, sectors and disciplines, all partners and resources required to achieve the targeted objectives. Critical mass is also needed to support large-scale initiatives, preparing full market deployment of solutions in areas like batteries, infectious diseases, smart and clean buildings and vehicles, low-emission technologies, circular economy, solutions for plastic waste, and connected/automated cars. Ambitions will have to be scaled back equally across the Programme if critical mass would not be available.

Over the first three years of Horizon 2020, only 11.6% of the proposals could be funded. This low success rate can be explained by the high attractiveness of the Programme, which has led to a sharp increase in the number of eligible proposals compared to FP7
[130](#footnote131)
. Moreover, in the first years of Horizon, only 1 in 4 high quality proposals could be funded - an additional EUR 62 billion would have been needed to fund all proposals independently evaluated above the stringent quality threshold.
[131](#footnote132)
. This underfunding represents an opportunity cost for Europe's promising R&I potential, since it undermines the critical mass needed to tackle global challenge; constitutes a waste of resources for the applicants (who spent an estimated EUR 636 million a year preparing proposals
[132](#footnote133)
), deters excellent R&I players from applying, and deprives the EU of the full potential of the Programme. Based on the steady trend observed over the last decade, the number of proposals should be larger than in Horizon 2020. If the resources allocated to the Programme would remain similar to those of Horizon 2020 (in constant prices), the success rate would likely decline, or at best be maintained at ~12%, with only 20% -25% of high-quality proposals funded. This success rate is too low for the Programme to be efficient - a success rate of 15-20% (comparable to FP7), and funding for at least 30% of high quality proposals would be ideal
[133](#footnote134)
.

Alternative measures to increase the success rate are not expected to be fully effective. Using financial instruments through the InvestEU programme and enhancing complementarities with other MFF programmes, including the European Regional Development Fund, would allow funding more R&I projects. More use of two-stage calls would filter proposals at an early stage
[134](#footnote135)
. However, financial instruments are not appropriate for all projects
[135](#footnote136)
, and two-stage calls will not solve the problem for unfunded high quality proposals. Likewise, decreasing the size of projects would imply abandoning larger scale projects, mainly affecting collaborative projects, which are an intrinsic part of the EU added value of the Programme. More strict eligibility criteria can improve overall success rate
[136](#footnote137)
, however will not address the issue of low success rate for high-quality proposals. Lastly, decreasing the funding rate would lower effectiveness because applicants, including those with high-quality proposals, would need to find complementary funding, and could be discouraged from applying or taking risks.

Figure 9 EC contribution requested in proposals (EUR billion)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_07022.jpg)

Source: DG Research and Innovation. NB: the "increase" scenario assumes an increase in proposals' requested contribution from Horizon 2020 to the new Framework Programme that is similar to the increase experienced from FP7 to Horizon 2020.

4Delivery for Impact

Efficient delivery is essential for reaching all the Programme’s objectives. This section will describe the improvements made in order to better reach the cross-cutting objectives of the MFF: simplification, flexibility, coherence, synergies and focus on performance. These improvements are based on recommendations for optimising delivery from the Horizon 2020 Interim Evaluation 
[137](#footnote138)
 and the Lamy High Level Group report
[138](#footnote139)
. The changes are presented in a structured way along the typical lifecycle of EU R&I support. When changes represent a significant departure from Horizon 2020 (see 
[Table 6](#_Ref508051204)
 for lessons learnt from Horizon 2020), they will be assessed qualitatively and, where possible, quantitatively. More details can be found in the Annex 9 on the Rules for Participation.

  

Table 5: Mapping of continued, discontinued and new features in Horizon Europe

|  |  |  |  |
| --- | --- | --- | --- |
| Continued without changes | Continued with changes | Discontinued | New |
| Design – Priorities | | | |
|  | ·Excellent Science: becomes Open Science pillar and does not include the FET specific objective  ·Societal Challenges: becomes Global Challenges and Industrial Competitiveness pillar and covers the LEITs specific objective of the Industrial Leadership pillar and the EIT, which was a separate specific objective | Industrial Leadership as a separate pillar | ·Open Innovation pillar  ·Strengthening the European Research Area : covers Science With and for Society, and Spreading Excellence and Widening Participation, which are Horizon 2020 specific objectives |
| Design - Specific objectives | | | |
| ·European Research Council  ·Marie Skłodowska Curie Actions  ·Research Infrastructures  ·Direct Actions (Joint Research Centre)  ·Support to the European Institute of Innovation and Technology | ·Leadership in enabling and industrial technologies (becomes cross-cluster, though in particular in Digital and Industry cluster)  ·Innovation in SMEs, (included in European Innovation Council)  ·Societal Challenges 1-7 (becomes Clusters in the Global Challenges pillar)  ·Science with and for Society (becomes intervention areas within ERA foundation  ·Spreading Excellence and Widening Participation (becomes Sharing Excellence, within ERA foundation) | ·Future and Emerging Technologies as separate label, but activities included in other parts  ·Fast Track to Innovation  ·Access to Risk Finance (covered under InvestEU programme) | European Innovation Council (building on EIC pilot) |
| Implementation - instruments | | | |
| ·Research and Innovation Actions  ·Innovation Actions  ·ERC frontier research  ·Training and mobility actions  ·Programme co-fund actions  ·coordination and support actions  ·inducement prizes  ·recognition prizes  ·public procurements  ·ERA Chairs  ·Twinning  ·Teaming  ·Policy Support Facility | ·Pre-commercial procurements (PCP) and Public procurement of innovative solutions (PPI) (becomes Coordinated innovation procurement)  ·SME Instrument (integrated into EIC Accelerator and transition activities)  ·Future and Emerging Technologies (FET)Open (becomes EIC Pathfinder)  ·Future and Emerging Technologies (FET)Flagships (incorporated within mission concept)  ·Support to Joint Programming Initiative, ERA-NET, Contractual Public Private Partnerships, Institutionalised public-private partnerships (Art. 187) and Institutionalised public-public partnerships (Art. 185): incorporated within European Partnerships, with strong criteria |  | ·Missions  ·EIC pathfinder  ·EIC accelerator |
| Implementation – concepts | | | |
| ·Key Enabling Technologies  ·Gender Equality  ·Ethics standards | ·International cooperation (new criteria)  ·Strategic planning – widened to include R&I activities from other funding programmes  ·Governance |  |  |

Optimising delivery is also key to achieve higher impact and further simplification
[139](#footnote140)
. When properly designed, the Rules for Participation ensure legal certainty for participants and contribute to overall coherence in terms of implementation. Simplification remains a continuing endeavour in Horizon Europe, building on the achievements of Horizon 2020, which reduced the administrative burden and costs for applicants, and made it more attractive for newcomers and SMEs through new elements like its funding model (single reimbursement rate and a flat rate for indirect costs), the Participant Portal, and e-signatures. Beneficiaries and stakeholders have reacted very positively
[140](#footnote141)
. 

Impact depends ultimately on the dissemination and exploitation of R&I data and results, and it needs to be effectively captured and communicated
[141](#footnote142)
. An ambitious and comprehensive dissemination and exploitation strategy will increase the availability of R&I data and results and accelerate their uptake to boost the overall impact of the Programme. The strategy will move from a focus on individual projects to analyses of portfolio of R&I results in key policy areas and will further endorse Open Access policy to incentivise the exploitation of R&I results. In particular, clusters of mature R&I results will be exploited in synergy with other EU programmes to foster their uptake at national and regional level, maximising the European innovation potential. This will be complemented by effective R&I communication and outreach campaigns that build trust and engage citizens.

Table 6 Lessons learnt from the Interim Evaluation of Horizon 2020 and from the Stakeholder Consultation

|  |  |  |
| --- | --- | --- |
|  | What do we have now? | What did we learn? |
| Strategic planning | The priority-setting process is defined in multiannual Work Programmes [142](#footnote143)  (WP). The WPs identify the priorities in calls for proposals. They allow some flexibility to respond to new developments [143](#footnote144) . The strategic planning process builds on: Scoping Papers developed by the Commission; foresight; targeted consultations of industry, academia and civil society; and input from experts (Advisory Groups). The WPs are adopted by Commission Decision, in consultation with Member State representatives in the 14 configurations of the Programme Committee. | The strategic planning process improved the intelligence base underpinning priority-setting, and made the focus of the programme more in line with stakeholders needs. Nonetheless, the translation of high-level challenges and objectives into specific calls and topics is not always clear, while the transparency in the WP formulation process and the participation of stakeholders/and citizens/CSOs in agenda-setting were identified as areas for improvement. |
| The single set of rules | The single set of rules (i.e. the Rules for Participation and dissemination of results) implies that the same rules are applied in all parts of the programme, regardless of the implementing body (Commission, Executive Agencies, Joint Undertakings). Only a very limited number of derogations from the Rules for Participation exist, when duly justified, e.g. for specific operating needs of public-to-public partnerships (Art. 185 TFEU) and public-private partnerships (Art. 187 TFEU) [144](#footnote145) . The Common Support Centre (CSC) harmonises implementation of the rules across all implementing actors. | The single set of rules and its harmonised implementation via the CSC are widely seen by beneficiaries as advantageous, contributing to increased legal certainty, coherence and simplification of the rules, though some partners perceived it as a loss of flexibility compared to FP7 [145](#footnote146) . Moreover, Member States have repeatedly expressed their wish to include Art. 185 TFEU initiatives under the the Participant Guarantee Fund [146](#footnote147) , which does not currently cover them. |
| The funding model | The rules concerning the contribution of the EU to eligible costs do not differentiate between organisation categories or types of activities (in contrast to the FP7 funding model, which used a complex matrix of organisation categories and activity types). Its main features are a single reimbursement rate for direct costs (up to 100% of eligible costs for Research and Innovation Actions, and up to 70% for Innovation Actions [147](#footnote148) ) and a single flat rate for indirect costs (25% is applied to the direct eligible costs [148](#footnote149) ). | The funding model has not led to a significant change in funding intensity [149](#footnote150) . The funding model is a simplification measure that allows for flexibility and that has mobilised and largely satisfied stakeholders [150](#footnote151) . The overall funding rate is on average 70% of total project eligible costs (both direct and indirect). In a simplification survey [151](#footnote152) , 78% of respondents appreciated the single reimbursement rate. |
| Simplified forms of grants | Horizon 2020 features a simplified cost reimbursement system with enhanced use of unit costs [152](#footnote153) , flat-rates and lump sums, while actual cost reimbursement (i.e. costs actually incurred by beneficiaries) is used still for the majority of the budget. Unit costs are used for specific types of personnel costs (i.e. for average personnel costs and SME owners without a salary) and other direct costs (i.e. internal invoices), while indirect costs are covered by a single flat-rate. Lump sums, at the start of Horizon 2020, were used for small-sized projects (e.g. Phase 1 of the SME Instrument). In the 2018-20 Work Programme, pilot actions were launched for testing lump sum project funding for "mainstream" collaborative R&I projects. | While beneficiaries express preference for actually incurred costs, a number of financial complexities are inherent to this model (e.g. calculation of the monthly hourly rate, additional remuneration). Moreover, reimbursement of actual costs focuses attention on justification of costs, and not on the expected impact as in the case of lump-sum funding. Further simplification of the actual cost reimbursement system is necessary, in particular for personnel costs. The European Court of Auditors [153](#footnote154)  also proposed that the post 2020 Framework Programme assesses the need for further use of simplified cost options such as lump sum project funding and prizes. |
| Grants and financial instruments | More than 90% of the Horizon 2020 support is grant based, while the rest is provided with financial instruments (i.e. debt or equity) through the European Investment Bank (InnovFin) [154](#footnote155) . Pre-commercial public procurement (PCP), public procurement for innovation (PPI) and inducement prizes represent only a limited share of the Horizon 2020 budget. | Only a small number of firms receiving Horizon 2020 grants benefitted from Horizon 2020 financial instruments. Extremely few companies taking part in Horizon 2020 obtained investments for scaling up from InnovFin. This points to a potential lack of integration between the grant and non-grant based instruments at different stages of the innovation cycle but also to limitations of intermediated risk-sharing mechanism where the initial risk is to be fully borne by the Union due to market risk-aversion [155](#footnote156) . |
| Proposal evaluation and selection | Major investment decisions are taken at the stage of evaluation and selection of proposals. The system, based on independent expert judgement ensures that the selected projects are the best. The approach ensures maximum coherence across the different implementing bodies, based on three award criteria against which proposals are evaluated: Excellence; Impact; and Quality and efficiency of the implementation [156](#footnote157) . | The Horizon 2020 proposal evaluation and selection process is generally highly regarded. Still, some stakeholders asked for more transparency, found the quality of evaluation feedback received uneven, and considered that the evaluation experts sometimes appeared to lack the appropriate expertise [157](#footnote158) . To increase efficiency in relation to over-subscription, two-stage calls for proposals were identified as good practice. |
| Ex-ante and ex-post audits | The general rules related to the management and implementation of projects are detailed in the Model Grant Agreement. Beneficiaries are bound by the grant agreement they sign with the Commission. The audit and control system seeks an appropriate balance between trust and control, taking into account administrative burden for participants. The Horizon 2020 audit strategy is based on the financial audit of a representative sample of expenditure, and is complemented by a selection based on risk assessment | The Common Support Centre strengthened the corporate approach in implementing the programme and in auditing projects. However, some Joint Undertakings expressed the need of additional direct audit coverage and considered the common representative sample as not sufficient enough for their needs, leading to a potential increase of audit burden towards the Horizon 2020 beneficiaries. |
| Dissemination and exploitation | Throughout Horizon 2020, specific calls for proposals, coordination and support actions and public procurement provide targeted assistance to projects in order to optimise the dissemination and exploitation of their research results. To further assist project consortia, the Commission provides tailor-made support services, e.g. the Common Exploitation Booster, the Common Dissemination Booster and the Innovation Radar. | Beneficiaries develop activities for better dissemination and exploitation but results are still not fully accessible to all relevant stakeholders and this represents a barrier to knowledge circulation and to innovation uptake. The uneven exploitation capacity among beneficiaries hinders market uptake. Moreover, feedback from R&I projects into policy-making must be strengthened [158](#footnote159) . |
| Delegation | To ensure a more modern, effective and dynamic implementation, while reducing staffing by 5% over 5 years [159](#footnote160) , 75% of Horizon 2020 budget is delegated to other EU bodies: Executive Agencies (55%), Public Private Partnerships (Art. 187 TFEU initiatives, 10%), the European Investment Bank (4%), the European Institute of Technology (EIT, 4%) and Public-Public Partnerships (Art. 185 TFEU initiatives, 2%). The remaining 25% is managed "in house" by the Commission. | The delegation to implementing bodies allows Commission services to focus on policy-making and strategic planning, while maximizing the effective and efficient use of EU funding. Executive Agency evaluations confirmed their effectiveness and high value for money, with administrative costs well below 5% [160](#footnote161) . |

4.1The strategic planning process

Towards a strategic, impact-oriented and collegial planning process. The strategic planning process will provide multi-annual strategic orientations for the Framework Programme. It will be co-created in synergy with other EU programmes and policies, with the intention of giving coherence to the entire portfolio of actions supported by the EU under the MFF. The process will be streamlined into a single Commission document
[161](#footnote162)
, applying to all Programme components
[162](#footnote163)
, including missions
[163](#footnote164)
, European Partnerships, and the EIT Strategic Innovation Agenda
[164](#footnote165)
. This draft Strategic R&I Plan will be open for public consultation, providing more involvement of EU Institutions and citizens than previously. The Work Programmes will then be developed on the basis of the finalised Strategic Plan.

In addition, a simpler governance structure with ad-hoc and flexible advisory mechanisms and Programme Committee configurations will improve the rationalisation and simplification of the planning process, hence delivering results more efficiently and transparently.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Increased co-creation with other EU Institutions and citizens. While in Horizon 2020 the priority setting was defined mostly with targeted consultations, the new Strategic R&I Plan will be more open for general public consultation, involving citizens, customers and end-users in agenda-setting (co-design) for the Programme. In particular, the public will have a say in the definition of R&I missions. |
|  | ·Higher coherence within the Programme and enhanced synergies with other EU Programmes. By bringing together all Commission services and implementing bodies, the Strategic R&I Plan will ensure a stronger and more inclusive agenda-setting process, whereby the linkages between EU Programmes would be strengthened, promoting faster dissemination and uptake of R&I results. |
|  | ·Better alignment of national and EU policies. Involvement of Member States at early stage in the discussion on the strategic planning and in consequences in the work programme preparation will help to build better alignment between national and EU R&I activities. |

4.2The single set of rules

The principle of a single set of rules will continue with further improvements. In line with the corporate approach towards a single-rule book and the preparation of the MFF, the new EU Financial Regulation
[165](#footnote166)
 will be used as a common reference under which the rules applicable to all EU funding programmes will be aligned. Derogations to the Financial Regulation are kept to the minimum, but maintained in order to strike the right balance between full harmonisation and specific needs of individual initiatives. The new Rules for Participation allow other funding bodies, in particular bodies implementing Article 185 or 187 TFEU initiatives, to establish limited derogations in their basic acts in cases duly justified by their specific needs. Furthermore, the Participant Guarantee Fund (renamed Mutual Insurance Mechanism) will be extended to article 185 TFEU institutionalised European Partnerships.

What alternatives were considered? Keeping Horizon 2020 status quo was considered for predictability, but this would have been a missed opportunity to streamline the approach taken on derogations (e.g. by maintaining the scope of the derogations for Art. 187 TFEU initiatives separate from other institutionalised European Partnership Initiatives) and for further simplification. Returning to FP7 Rules would provide more flexibility (e.g. by allowing different funding bodies to adopt rules as they see fit), but this would result in diverging rules, undermining simplification, legal certainty and hampering participation.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·More simplification and reduced costs. The single set of rules contributes to the rationalisation of the new Framework Programme. It further harmonises and streamlines implementation methods, hence simplifying the burden e.g. for preparing and submitting proposals. It increases the accessibility and attractiveness of the programme, in particular for applicants with limited resources, such as SMEs. |
|  | ·Improved synergies with other EU programmes. As the number of derogations to the Financial Regulation is reduced, EU programmes are more likely to share common rules. This increases the possibility for more targeted multi-faceted EU support, for instance through missions. |
|  | ·Increased flexibility while maintaining legal certainty. The Framework Programme will further improve the balance between flexibility and legal certainty e.g. by allowing funding bodies to establish rules that depart from those laid down in the Financial Regulation or in the Rules for Participation, in order to accommodate their specific operating needs of individual initiatives in duly justified cases. |

4.3The funding model

Rules on funding rates will be maintained. Given the largely positive assessment of the Horizon 2020 funding model, Horizon Europe will maintain the single reimbursement rate for direct costs (up to 100% of the total eligible costs for Research and Innovation Actions and up to 70% for Innovation Actions) and the single flat rate for indirect costs (25% is applied to the total direct eligible costs)
[166](#footnote167)
. Similarly, the funding rate will be a maximum - this ceiling can be reduced for implementing specific actions, where duly justified (e.g. for Euratom, or specific close-to-market calls).

What alternatives were considered? Alternatives to the continuation were considered, mainly to reduce oversubscription
[167](#footnote168)
, but maintaining attractiveness (i.e. broad involvement from all sectors and disciplines) is more important. A lower funding rate for all projects (e.g. 75%) would allow a larger number of beneficiaries to benefit from EU support. However, such an approach would decrease the overall attractiveness of the programme, especially for non-profit entities and SMEs, hence affecting the principle of excellence. Different levels of funding for industry compared to other types of beneficiaries were also considered, but this approach would have a negative impact on industry participation, on simplification and on time-to-grant. Alternative ways to address oversubscription are also identified in section 3.4 on critical mass.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Maintained programme attractiveness. Continuity in the funding model enhances predictability, legal certainty, attractiveness and ease of access to the Programme. Administrative burden would not increase. On the contrary, a significant departure from the Horizon 2020 model would force beneficiaries to adapt once again to a new system. |
|  | ·Further simplification and more flexibility. The benefits of the current funding model have already largely materialised [168](#footnote169) : simple financial management of projects; reduced complexity of the financial rules; reduced financial error rate; acceleration of the granting processes. |
|  | ·Reduced oversubscription. Extending the use of flexibility to establish lower funding rates in the Work Programme can contribute to reducing oversubscription for targeted calls or topics. The level of co-investment will increase or at least remain the same as in Horizon 2020. |

4.4Forms of funding, including simplified cost options

The cost reimbursement scheme will be further simplified. The two current unit costs (average personnel costs and internally invoiced goods and services) calculated in accordance with the beneficiary's practices
[169](#footnote170)
 will be maintained. In addition, in view of simplification, the unit cost for internally invoiced goods and services will allow for a higher acceptance of the usual cost accounting practices. Beneficiaries will be able, under certain conditions
[170](#footnote171)
, to calculate such unit cost based on ‘actual direct and indirect costs', provided those costs are recorded in their accounts. The need to further align programme provisions with beneficiaries’ accounting practices was also a recommendation from the European Court of Auditors
[171](#footnote172)
. In order to lower administrative burden, an increased use will be made of lump-sum project funding against fulfilment of activities – building on the experience from the lump-sum pilot in Horizon 2020 – as well as other simplified forms of funding provided by the new Financial Regulation, including other incentives based on contributions not linked to costs, where appropriate.

As regards actual costs, the calculation of personnel costs will be further simplified and aligned to the Financial Regulation. The distinction between basic and additional remuneration will be removed and the Horizon 2020 capping on the additional remuneration abolished. For beneficiaries with project-based remuneration
[172](#footnote173)
, costs of personnel will be eligible up to the remuneration that the person would be paid for the time worked in projects funded by national schemes.

The system of in-kind contributions provided by third parties to beneficiaries will be further aligned to the Financial Regulation: in-kind contributions against payment will be treated and reimbursed under other budget categories according to the eligibility criteria for actual costs. In addition, the calculation of in-kind contribution free-of-charge will be further simplified: no distinction will be made if these resources are used on the premises of beneficiaries or third parties and beneficiaries will no longer need to declare them, under specific conditions, as receipts.

What alternatives were considered? Alternative simplified costs options were assessed regarding rules for personnel costs, such as optional unit cost (hourly rate) or contributions not linked to costs but were not found feasible. Fully relying on the Financial Regulation was also considered, but such an approach would imply a significant departure from current practices (lack of continuity) and would be negatively perceived by beneficiaries.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Lower administrative burden. The broader acceptance of beneficiaries’ usual cost accounting practices, the abolition of the additional remuneration scheme, and the extended use of lump sum and output-based funding significantly contributes to simplification, as they improve and simplify reimbursement of actual costs, while providing flexibility. In particular, the use of lump sums reduces substantially the reporting requirements from beneficiaries during the lifetime of the project, shifting the focus of project monitoring from financial checks to performance and content. |
|  | ·Lower error rate. The further acceptance of the beneficiaries’ usual cost accounting practices will reduce the error rate on issues that have generated recurrent and repetitive errors under FP7 and Horizon 2020. For example, the abolition of the additional remuneration scheme will allow the beneficiaries to report their personnel cost with respect to their usual accounting practices, whilst the current experience on auditing lump sums has confirmed the low error rate on such transactions. |
|  | ·More coherence with the Financial Regulation. An alignment of the rules with other EU funding programmes will also allow the beneficiaries to apply even more widely their usual accounting practices, as this reduces the need to amend reporting models to the various (and sometimes diverging) needs of each EU programme. This harmonisation and further acceptance of the beneficiaries’ usual accounting practices will reduce the administrative burden of the beneficiaries. |

4.5Grants, financial instruments and blended finance

Blended finance will help companies to scale up. The supply of flexible and agile funding schemes is essential for innovators. Grants will continue for projects that are far from the market, for example for basic research
[173](#footnote174)
. Yet, projects that are closer to market may still present a too high-risk profile, preventing them access to risk finance. Through the European Innovation Council (EIC), the new Framework Programme will offer large-scale blended funding (grants or reimbursable advance with equity or guarantees) to companies undertaking such projects, for late stage innovation activities, but also for market deployment activities such as pilot manufacturing, large trials or ensuring regulatory compliance
[174](#footnote175)
, tailored to their risk level and technological maturity. The overall purpose of blended finance shall be to support high-risk innovations beyond the usual limits of grant-based research, where the risks – whether technological, market or regulatory – cannot be borne by the market alone. By combining grant-type funding with equity or guarantees under the EIC, the Programme will hence bridge the financing gap between late stages of R&I and market uptake and deployment, and will encourage investors and lenders to support innovative high-risk projects, with a greater propensity to co-invest or to offer lower interest-rates and less onerous requirements for collateral.

What alternatives were considered? While innovation at large will be reinforced by the InvestEU single fund - providing indirect financial instruments carried out through the European Investment Bank Group or other implementing partners, with a dedicated window for R&I investments and specific products for innovative companies - financial intermediaries (banks and investors) may remain averse to the residual risk they bear when investing in high-risk innovative projects. To date, available private and corporate financing remains small
[175](#footnote176)
 for late stage of innovation activities and market take-up for high-risk breakthrough innovations, as financial institutions must limit their risks to maintain their market rating. There is hence a necessity for direct Union intervention. Providing only for grant allows to start de-risk operations and attract private or corporate finance, but partially, as some activities too close to market, including deployment and scale-up, may not be covered by grants. Furthermore, the classical alternative of awarding blended finance to a project by allocating grant-type funding (through the Framework Programme) and financial instruments (through InvestEU) might not be fully adapted to the needs of risky breakthrough innovators, who need to proceed to the market quickly.

Box Error! No sequence specified.: Examples of blended finance

|  |
| --- |
| National innovation agencies such as Vinnova, BPI France, Innovate UK and CDTI operate blended finance in the form of grants in combination with soft loans and venture investments:  ·A loan combined with a grant: the proportion of grant to loan depends on an assessment of the riskiness of the innovation whose development the funding will support: the higher the risk, the greater the grant component. This approach can be combined with the whole or partial write-off of the loan if the development of the innovation fails for technical or commercial reasons; or the reimbursement of part of the grant if the innovation succeeds.  ·A conditional grant combined with a loan or equity: the payment of all or part of the grant is conditional on the grantee obtaining at least a matching amount as a loan or an equity investment (such as venture capital) from a lender or investor. |

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Raise availability of large-scale risk finance in Europe by providing large tailor-made investments that combine EU support through grants and blended finance, in addition to investment through support to equity or guarantees. |
|  | ·Increase leverage through active measures put in place for EU R&I funding to stimulate private finance. For instance, proposals may also be submitted by investors including public innovation agencies looking for co-investment. A set of actions to improve ‘investment-readiness’ and ‘bankability’ will continue from the Horizon 2020 EIC Pilot in term of coaching (InvestHorizon), and the EIC events aimed at matching investor/investee and awareness raising. |
|  | ·Increase risk taking for breakthrough innovation by de-risking technical or financial failure. |

4.6Proposal evaluation and selection

The key elements of the proposal evaluation and selection system will be maintained, including the use of independent experts, and the use of three award criteria (based on excellence, impact and quality and efficiency of the implementation) across the board, with differentiation for the proposals for ERC frontier research actions, which will continue to apply only the excellence criterion and for the EIC’s Accelerator whose evaluation will include valuation of risk. Small improvements in order to address lessons learnt from the Horizon 2020 Interim Evaluation (e.g. to improve quality of feedback to applicants, differentiated expert panels, and multi-stage and multi-step procedures, gender balance in evaluation panels and the integration of the gender dimension in R&I content) can be ensured throughout the implementation of the Work Programmes. To increase the societal relevance and applicability of proposals, greater use of civil society expertise should be encouraged in appropriate evaluation panels
[176](#footnote177)
. In particular for missions and the EIC, the Commission may select proposals based not only on the merit of individual proposals, but also in relation to the overall coherence of the portfolio of projects and other Union policy objectives. While the main principles would be spelled out in advance in the Rules, the Work Programmes will provide further details on the application of the award criteria depending on the objectives of the calls and instruments (e.g. the aspects to be taken into account under the evaluation procedures).

Box 11 Access conditions to the Framework Programme

|  |
| --- |
| For collaborative projects, the consortium must include at least three independent legal entities established in a different Member State or associated country, and with at least one of them established in a Member State, unless otherwise provided for in the work programme. For other specific activities (i.e. EIC, ERC, co-fund, or MSCA training and mobility actions), different minimum conditions apply. Additional eligibility criteria may be laid down in the work programme. In case of actions carried out outside the Union using and/or generating classified information, a security agreement have to be concluded between the Union and the third country in which the activity is conducted. |

What alternatives were considered? A possible alternative was the exclusion from the Rules for Participation of these provisions, relying instead on the full flexibility offered by the Financial Regulation (leaving the criteria and other provisions for the Work Programmes). Although this would maximise flexibility, it risks a divergence of rules in practice, jeopardise smooth business processes, and lead to unpredictability for applicants. Specifying in full detail the criteria for evaluation and selection of proposals in the Rules would ensure a high degree of coherence across the programme and a measure of stability for applicants but would represent a significant loss of flexibility.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Achieve a balance between flexibility and coherence. The current system has been shown to work well, and there is no evidence for the need for a fundamental change. However, missions and the EIC require a proactive portfolio management to reach their objectives, calling for flexibility to ensure overall consistence. Providing the main ground rules in the legislation, while permitting adaptability via the Work Programme, has proven in the current and previous programmes to ensure coherence across the board, predictability for applicants, and smooth business processes, while maintaining a strong degree of flexibility and the possibility for experimentation. |
|  | ·Maintain a strong focus on excellence and performance. Streamlined but adaptable rules will help applicants design well-focussed proposals, and will lead to processes in which the best proposals are identified and selected as quickly as possible. |

4.7Ex-ante and ex-post audits

A wider cross-reliance on audits and assessments – including with other EU programmes – is envisaged. The increased alignment to the Financial Regulation provide an opportunity for audit synergies via Systems and Processes Audit. Indeed Systems and Processes Audit avoid duplication of audits, since there will be a common audit approach on common financial rules and hence a more harmonised and simple audit approach. By cross relying on audits of beneficiaries among the various EU programmes, the need for additional auditing will gradually be reduced. In addition, cross-reliance has been explicitly considered in other elements of assurance (e.g. Systems and Processes audits and audit on transactions) resulting into a reduced need for financial audits on beneficiaries with positive results in their Systems audits. Moreover, cross-reliance could be part of the conditions under which the obligation for the beneficiary to submit a certificate on the financial statement can be waived.

Further efforts in the area of ex-ante controls through implementing additional automated checks and tools for simpler entry of the data, will have a positive impact where beneficiaries need to submit information to Commission. Integration of ex-post audit support into the Participant Portal will enable better view on the progress of the audits to the beneficiaries, allow completely electronic exchange of documents and notifications, all that can anticipate additional reduction of burden and costs to beneficiaries.

What alternatives were considered? The concept of cross-reliance on other audits or assessments with other EU programmes was considered, however its effectiveness depend on the homogeneity of the rules between programmes. Identifying possible common benchmarks / principles or best practises for a broader acceptance of usual cost accounting practices of beneficiaries from different sectors and different countries can be further explored as a second alternative in view of moving a step forward from a ‘rule-based’ approach towards a ‘principle-based’ one. However, it should be noted that such a challenging alternative would be possible only once having taken into account the eligibility criteria of the different programmes, in the particular context of the absence of any international standard in that matter.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Reduce administrative burden. Compared to Horizon 2020, the Systems and Processes Audit (SPA) will lead to a reduction of the audit burden of the beneficiary that has been positively assessed. A beneficiary which is positively assessed via a Systems and Processes Audit, receives a long term assurance that their usual accounting practices are compatible with the Horizon Europe’s eligibility requirements, whilst the need for further auditing ceases to exist. The introduction of Systems and Processes Audit is a holistic audit approach, resulting into an overall assurance which when achieved, results into a significant reduction of the audit burden. |
|  | ·Increase simplification for beneficiaries of EU funds. The Systems and Processes Audit (SPA) allows for more synergies with the Audits carried out under the shared management mode (e.g. especially those performed under the European Regional Development Fund). With this cross-reliance between audits, the Commission increases efficiency and effectiveness, avoids duplication of audit efforts and initiates a process where auditors within the Commission can exchange data and reviews. |

4.8Policy and rules regarding Dissemination and Exploitation

Horizon Europe will provide dedicated support to dissemination (including through open access to scientific publications), exploitation and knowledge diffusion actions. Strong emphasis will be placed on portfolios of research results for targeted diffusion to end-users, citizens, public administrations, academia, civil society organisations, industry and policy-makers, including through the use of data intelligence tools for harvesting knowledge and providing innovative data uses and visualisation.

More emphasis is put on to promoting the exploitation of R&I results, in particular in the EU. Horizon 2020 provides for a "best effort" to exploit results and, if indicated in the Work Programme, for additional exploitation obligations. In Horizon Europe, the "best effort" approach to exploit must have a particular focus on the EU. As in Horizon 2020, the Work Programme can specify additional obligations if justified. The beneficiaries must include in their proposals a dissemination and exploitation plan that must be updated during and after the end of the project, to ensure a continued focus on the exploitation of results.

What alternatives were considered? Alternatives for better exploitation of R&I results that were considered range from not having specific rules at all, to having more stringent rules across the board. Having a more stringent general rule was considered unjustified, as there may be valid reasons why exploitation occurs elsewhere (the EU often still benefits from such exploitation). Moreover, such a broad approach would deter industrial and international participants. Having no rules at all, and leaving the full choice of exploitation location to market forces was considered insufficent to safeguard the appropriate exploitation of results for the benefit of the Union.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·More economic and societal impact. By fostering better exploitation of R&I results, a more EU-focussed exploitation increases the accessibility of high quality content, while ensuring that the benefits serve the EU. They aim at better ensuring the right balance between the pursuit of EU strategic interests in terms of competitiveness and job creation on one hand, and attractiveness for industry and openness to international participation on the other. This will assist market uptake, boost impact, and increase the innovation potential of results supported by EU funding. |
|  | ·Some additional reporting requirements. The possibility of additional reporting specifically on exploitation or impact demonstration and related administrative burden will be weighed against the need to have accurate information regarding the exploitation of results beyond the lifetime of the projects. |
|  | ·Higher market uptake, impact and innovation potential. Union support will ensure a constant stream of knowledge and innovations towards the scientific community, industry, policy-makers, and the public. Dedicated support services developed by the Commission, combined with the strengthened exploitation plans of the beneficiaries, will satisfy both the legitimate interest of beneficiaries and the interest of the public. |

4.9Delegation to Executive Agencies

The Commission will increase the share of the budget delegated to Executive Agencies, subject to positive outcome of the mandatory Cost Benefit Analysis. Given the new elements in the scope of the new Framework Programme (e.g. missions and the EIC) and the increased budget to be delegated, the reshaping of the portfolios of the existing Executive Agencies will be needed along with exploring the possibility of establishing additional ones. Activities with substantial policy content will be excluded from delegation to Executive Agencies while, in parallel, the effective feedback of R&I data and results from Executive Agencies to the Commission will be reinforced, in line with the dissemination and exploitation strategy, to strengthen the inputs for policy-making.

What alternatives were considered? For the implementation of the new Framework Programme, the following alternative options were considered: an 'in-house' scenario (reintegration of part of the programme management in the Commission); maintaining the current status as in Horizon 2020; and full delegation of all programme's activities. The in-house scenario would imply returning to previous management modes that entailed comparably higher administrative costs
[177](#footnote178)
. Specific scenarios for the implementation of the EIC activities through a dedicated Executive Agency are described in the Annex 8 on the EIC.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Reduce administrative costs. Independent evaluations [178](#footnote179)  show that delegation to Executive Agencies brings substantial savings in administrative expenditure. The administrative costs of the programme implementation by Executive Agencies in Horizon 2020 are around 2-3% of the operational budget, which is well below the target of 5%. |
|  | ·Improve synergies with other programmes. Executive agencies manage parts of different programmes that complement each other [179](#footnote180) : rationalising their portfolio can help aligning and integrating objectives of different programmes, for instance better linking R&I results to market deployment. |
|  | ·Enhance focus on performance. Executive Agencies have reached and maintained very high levels of satisfaction among their beneficiaries [180](#footnote181) , while at the same time successfully managing a larger number of projects than in FP7. This consistent high performance allows the Commission to focus on strategic priorities. |

4.10Overall impact on the objectives of the MFF

The delivery tools of the Framework Programme will contribute to the cross-cutting objectives of the Multiannual Financial Framework (MFF), notably simplification, flexibility, coherence, synergies and focus on performance. Overall, the Framework Programme is expected to deliver large benefits that outweigh costs, in particular for the Programme's focus on performance, its flexibility, as well as its internal coherence and its synergy with other programmes (see 
[Ta](#_Ref508057448)
[ble 8](#_Ref508057448)
).

Other MFF Programmes are closely linked to the new EU R&I Programme: synergies and complementarities between them should be enhanced (see 
[Table 7](#_Ref509417027)
 and Annex 7). Current Horizon 2020 beneficiaries also benefited from other EU programmes, e.g. the European Structural and Investment funds, EU Health Programme, and COSME
[181](#footnote182)
.

Table 7 Synergies and complementarities with other MFF proposals

|  |  |
| --- | --- |
| MFF Programmes | Links to new Framework Programme |
| Common Agricultural Policy (CAP) | A key priority for the ‘second pillar’ of the post-2020 CAP [182](#footnote183)  is an increased focus on fostering innovation, in particular through wider diffusion of innovation, better access to new technologies and investment support. This will involve strengthening the links between agricultural and rural development policies and R&I in support to the development of knowledge and innovation systems. The development of an ambitious, integrated Strategic Research and Innovation Plan will define priorities of the Framework Programme in the area of food, nutrition security and sustainable management of natural resources with a view to develop synergies between the Framework Programme and the CAP. The latter will promote the use, implementation and deployment of innovative solutions, including those stemming from R&I projects funded by Horizon Europe. |
| European Maritime and Fisheries Fund | The post-2020 European Maritime and Fisheries Fund will provide important support to the implementation of the Common Fisheries Policy and the Maritime Policy. This programme will focus on creating the conditions for boosting competitiveness in the blue economy, especially through close-to-market innovation, access to marine knowledge and by ensuring a safe and secure maritime space. Strong and sustainable blue growth requires enhanced synergies with wider EU intervention. The Framework Programme is of particular relevance in this respect as it strengthens the knowledge base from which new, innovative products, processes and services can emerge in the maritime economy. The EMFF will support the rolling out of novel technologies and innovative products, processes and services, in particular those resulting from Horizon Europe in the fields of marine and maritime policy. |
| Connecting Europe Facility (CEF) | The post-2020 CEF will prioritise the large-scale roll-out and deployment of innovative new technologies and solutions which result from projects in transport, energy and telecommunications funded by the Framework Programmes. Horizon Europe will support all stages in the R&I chain, including non-technological and social innovation, and closer-to-market activities with innovative financial instruments. Through the Strategic Research and Innovation Plan, Horizon Europe will support R&I on transport, energy and mobility, in particular through the Climate, Energy and Mobility cluster, as well as digital technologies. The exchange of information and data between Horizon Europe and CEF projects will be facilitated, for example by highlighting technologies from the Framework Programme with a high market readiness that could be further deployed through CEF. |
| Digital Europe Programme (DEP) | DEP focuses on large-scale digital capacity and infrastructure building in High Performance Computing, Artificial Intelligence, Cybersecurity and advanced digital skills aiming at wide uptake and deployment across Europe of critical existing or tested innovative digital solutions. While several thematic areas addressed by both programmes converge, DEP will mainly focus on roll-out and deployment activities outside research and innovation, whereas the Framework Programme will focus on investing in the entire spectrum from research to market. R&I needs related to digital aspects are identified and established in Horizon Europe strategic R&I plan, while DEP capacities and infrastructures are made available to the research and innovation community, including for activities supported through Horizon Europe such as testing, experimentation and demonstration across all sectors and disciplines. |
| Erasmus | The post-2020 Erasmus will continue to support mobility, cooperation and policy initiatives in the field of higher education. This includes support for integration of education, research and innovation, development of competences and inter-disciplinary, transferable, digital and entrepreneurial skills in forward-looking fields or disciplines and support to higher education institutions, research centres, businesses and civil society to contribute to innovation. The Framework Programme will continue to invest in the people behind research and innovation, strengthening their skills, training and career development and fostering the transfer of knowledge and cooperation between research-performing organisations and providing incentives for universities embracing open science policy. Horizon Europe will complement the Erasmus programme's support for the European Universities initiative, in particular its research dimension, as part of developing new, joint and integrated long-term and sustainable strategies on education, research and innovation based on trans-disciplinary and cross-sectoral approaches to make the knowledge triangle a reality. |
| European Defence Fund | Complementarity and synergies with the European Defence Fund will be ensured, so that results under civil R&I also benefit defence R&I and vice-versa. |
| European Regional Development Fund (ERDF) | The post-2020 European Regional Development Fund (ERDF) will provide an important part of EU funds for R&I. The post-2020 ERDF may feature increased funds dedicated to the take-up of results and the rolling out of novel technologies and innovative solutions from past Framework Programme and Horizon Europe. It will continue to invest in actions that build R&I capacities of actors aimed at participating in the Framework Programme or other internationally competitive R&I programmes. Holders of Seal of Excellence [183](#footnote184)  labels from the Framework Programme may be funded by Member States and regions, where relevant to the local context and smart specialisation strategies, including with resources from any Union shared-management programme. The same applies for national funding of joint programmes co-funded under the Framework Programme. In addition, budget from share management could be voluntary transferred for implementation to central managed programmes. Part of the Framework Programme will continue to support low-performing countries in R&I, in the context of strengthening the European Research Area. Smart specialisation strategies will continue to promote innovation based on the strengths of each region and be a basis for ESI Funds investments in R&I and the innovation eco-systems. |
| European Social Fund+ (ESF) | The post-2020 European Social Fund will continue to invest in human capital and skills development, as well as in social innovation. The ESF+ can mainstream and scale up new and innovative curricula for education and training programmes developed in R&I projects under the Framework Programme. Holders of the Seal of Excellence may be funded by the ESF+ to support activities promoting human capital development in research and innovation with the aim of strengthening the European Research Area. The Health strand of the ESF+ will mainstream innovative technologies and new business models and solutions, in particular those resulting from the Framework Programmes. |
| Neighbourhood, Development and International Cooperation Instrument | The future Neighbourhood, Development and International Cooperation Instrument will merge several EU external instruments existing in the 2014-2020 period [184](#footnote185) . The broad instrument will include a prominent neighbourhood window, strong focus on migration including a 20% unallocated envelope and provisioning for Macro-Financial Assistance.  There are inherent complementarities between Horizon Europe and the future Instrument, for example in so far as they both contribute towards the EU's international commitments such as the 2030 Agenda for Sustainable Development [185](#footnote186) , the Paris Agreement on Climate Change, or the renewed EU-Africa Partnership among others. The Neighbourhood, Development and International Cooperation Instrument will continue to complement the Framework Programme by building research and innovation capacity (at individual, organisational or institutional levels) including through research infrastructures in third countries and regions. It will support the diffusion and uptake of innovations, the development of human capital and market access for technological solutions developed through collaborative research and innovation. |
| Innovation Fund under the EU Emissions Trading System | The Innovation Fund under the EU ETS will support low-carbon technology demonstration projects in the EU. It has been established by the revised EU ETS Directive and it will use the proceeds from the auctioning of at least 450 million allowances under the EU ETS, as well as leftovers from the current NER 300 programme. It will specifically target innovative low-carbon technology demonstration projects in industry, renewable energy, energy storage, carbon capture and storage (CCS) or industrial carbon capture and use (CCU) to be developed via the R&I window of the (InvestEU Programme) in addition to resources deployed therein. Horizon Europe will fund the development and demonstration of technologies that can deliver on the EU decarbonisation, energy and industrial transformation objectives. |
| Internal Security Fund and  Integrated Border Management Fund | The future Security and Border programmes will contribute to ensuring a high level of security in the Union, inter alia by tackling terrorism and radicalisation, organised crime and cybercrime, and by supporting the effective implementation of the European Integrated Border Management system. The programmes will support Member States’ efforts in these areas, including by incentivising Member States to take up and apply R&I results from the Framework Programme. The Framework Programme will support R&I in the area of security, including border management, in particular though the cluster on Resilience and Security. Potential complementary actions can also be considered under Horizon Europe regarding research and innovation for customs control equipment in view of the Union instrument for financial support for customs control equipment (CCE). |
| InvestEU Fund | The InvestEU Fund will include financial instruments in four separate policy windows. An R&I thematic window will bundle financing activities that are closely linked to the objectives of the R&I Framework Programme, and dedicated products for innovative SMEs and mid-caps will be deployed through SME window. Blended finance in the Framework Programme will be provided by the EIC to high-risk market-creating innovations. Appropriate synergies with the new InvestEU programme shall be established, in particular regarding budgetary guarantees and leveraging Venture Capital funds supported by InvestEU. |
| Programme for Environment and Climate Action (LIFE) | The post-2020 LIFE programme will continue to act as a catalyst for implementing EU environment and climate policy and legislation, including by taking up and applying R&I results from the Framework Programmes and help deploying them at national and (inter-) regional scale. LIFE will continue to incentivise synergies with Horizon Europe through the award of a bonus point during evaluation for proposals which feature the uptake of Framework Programmes’ results. Horizon Europe will contribute to tackling environmental challenges in particular through the clusters on Health, Climate, Energy and Mobility and Food and Natural Resources by defining relevant R&I activities in the Strategic Research and Innovation Plan. |
| Single Market Programme, including the Competitiveness of Enterprises and SMEs Programme (COSME) | The post-2020 COSME will address market failures that affect all SMEs and will promote entrepreneurship and the creation of growth of companies. Under the Framework Programme, the European Innovation Council (EIC) will directly support the activities and scale-up of high-risk profile innovative start-ups, SMEs and mid-cap firms, while the InvestEU programme will more broadly focus on R&I-driven innovative companies. The Enterprise Europe Network as a corporate tool with its Key Account Managers will continue to play a role in Business accelerator services of the EIC aiming at providing beneficiaries with access to partners, investors, and assistance (coaching, training, technical support). |

  

Continued simplification will enhance user-friendliness. User-friendliness will mainly be enhanced by maintaining the single set of rules, continuity of funding rates and new simplifications such as the new simplified cost options, and the increased cross-reliance on certified accounting systems. Moreover, the European Innovation Council will also act as a one-stop-shop for innovators looking for funding, while also rationalising existing funding schemes for innovation, and will be clearly and visibly branded as such. European Partnerships will be opened up for all interested stakeholders. The Research Participant Portal is already highly appreciated by stakeholders (as well as other Commission services,) and we will further improve its design for the new Programme. Finally, a "toolbox" will be created to provide a comprehensive overview of all available funding tools in the legal proposal.

Synergies will be enhanced through the revamped strategic planning process, which will allow for identifying common objectives and common areas for activities (such a partnership areas or mission areas) across different Multi-Annual Financial Framework programmes. It will be open for public consultation, involving EU Institutions and citizens and end-users in agenda-setting (co-design) for the Work Programme.

Internal coherence will be strengthened through a redesigned pillar structure. The Framework Programme will not set objectives per pillar but at Programme-level. Each pillar and programme part is expected to contribute to those objectives albeit to different degrees. This will in turn ensure that each euro invested in one area will generate multiple impacts.

The Programme has the flexibility to easily adapt to emergencies or new priorities. The strategic flexibility in the programming process will allow the Commission to react to urgent needs and new priorities well beyond its start date in 2021. The Programme will be able to shift budget allocations within and between pillars. Similarly, the strong cross-disciplinary, cross-sector and cross-border nature of the Programme allow it to produce R&I results relevant to changing circumstances.

Table 8 Contribution of Horizon Europe to the MFF cross-cutting objectives (compared to Horizon 2020)

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
| Delivery for impact | MFF cross-cutting objectives | | | | |
|  | Simplification | Flexibility | Coherence | Synergies | Focus on performance |
| Strategic planning | 0 | 0 | ++ | + | + |
| Single set of rules | 0 | + | + | + | 0 |
| Funding model | 0 | 0 | 0 | 0 | 0 |
| Forms of funding | ++ | + | 0 | 0 | 0 |
| Blended finance | - | ++ | 0 | + | + |
| Proposal evaluation | - | + | + | 0 | + |
| Ex-ante and ex-post audits | + | 0 | + | + | 0 |
| Dissemination & exploitation | - | 0 | 0 | + | ++ |
| Delegation | 0 | 0 | 0 | + | + |

Note: +, ++, +++ correspond respectively to slight, moderate and significant improvement compared to a no-policy change scenario. +/- correspond to a coexistence of positive and negative impacts. – indicates a slight negative impact. 0 means no significant change.

5How will performance be monitored and evaluated?

The monitoring and evaluation framework of the new Framework Programme
[186](#footnote187)
 will have three main building blocks:

·Annual monitoring of the programme performance: tracking of performance indicators in the short, medium and longer-term according to key impact pathways towards Programme objectives, based on baselines and targets where possible;

·Continuous collection of programme management and implementation data;

·Two fully-fledged (meta)-evaluations of the programme at mid-term and ex-post (upon completion).

Figure 10 Tracking performance of the programme along key impact pathways towards impact categories translating the Programme's general objectives

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_07031.jpg)

Impact pathways, and related key impact pathway indicators, will structure the annual monitoring of the programme performance (see Annex 6) towards its objectives. The objectives translate into three complementary impact categories (each being tracked along several pathways), which reflect the non-linear nature of R&I investments:

1.Scientific impact: related to supporting the creation and diffusion of high-quality new knowledge, skills, technologies and solutions to global challenges;

2.Societal impact: related to strengthening the impact of research and innovation in developing, supporting and implementing EU policies, and support the uptake of innovative solutions in industry and society to address global challenges;

3.Economic impact: related to fostering all forms of innovation, including breakthrough innovation, and strengthening market deployment of innovative solutions

The impact pathways will be time-sensitive: they will distinguish between the short (typically as of one year, when the first projects are completed), medium (typically as of three years, and for the interim evaluation) and long term (typically as of five years, and for the ex-post evaluation). The impact pathway indicators will contain both qualitative and quantitative information, the availability of which will depend on the state of implementation of the Programme. These indicators serve as proxies to report on the progress made towards each type of impact at Programme level. Individual programme parts will contribute to these indicators to a different degree and through different mechanisms. Additional indicators might be used to monitor individual programme parts when relevant and commensurate. These indicators proposed (see Annex 6) reflect the lessons learnt from the interim evaluation of Horizon 2020: all Horizon 2020 indicators related to outputs, results and impacts are maintained but streamlined and further specified to cover the whole programme. The management and implementation data is still collected but is separated from the key performance indicators, as illustrated in 
[Table 9](#_Ref509415203)
.

Table 9 Monitoring and Evaluation Frameworks

|  |  |
| --- | --- |
| Horizon 2020 | The new Framework Programme |

|  |  |
| --- | --- |
| 3 headline indicators not directly attributable to the programme [187](#footnote188)  55 Horizon 2020 Key performance and Cross-Cutting issues indicators:  §27 are related to management and implementation data (e.g. funding, participation)  §28 are related to outputs, results or impacts, out of which:  onone is related to the programme as a whole (covering only programme parts)  o9 relate to publications  o7 relate to intellectual property rights and innovations  o4 relate to leveraged funding  o4 relate to researchers’ mobility and access to infrastructures | ØAll Horizon 2020 indicators related to outputs, results and impacts are maintained but streamlined and further specified to cover the whole Programme  ØManagement and implementation data are still collected and made available in close-to-real time through Dashboard but are not part of “performance indicators”  ØKey indicators are set at Programme level according to the Programme objectives and are attributable to the Programme  ØKey indicators are classified according to 9 key impact pathways, for tracking impact through short, medium and long term indicators – for more accurate reporting over time  ØHigher reliance on external data sources, qualitative data and automated data tracking to minimise burden on beneficiaries  ØPossibility for programme part or action specific indicators (but not in the legal base) |

The micro-data behind the key impact pathway indicators will be collected in a centrally managed and harmonised way, with minimal reporting burden. This will be achieved, for example, by collecting at proposal stage the unique identifiers of applicants, by sourcing data automatically from existing external public and private databases also after project’s end (e.g. data on publications, patents, employment and turnover), by adopting new ICT tools (e.g. text mining) and by using alternative primary data sources (e.g. expert reviews). Longer-term impact indicators may be estimated based on dedicated studies. The data collected will allow tracking disaggregated indicators and be analysed per type of action, type of organisation, type of collaboration, sectors, disciplines, calls, countries (including associated and third countries).

Baselines, targets, and benchmarks will be established prior to the Programme’s launch. External experts will help establish accurate and timely baselines, and propose targets with appropriate benchmarks, where relevant. To the extent possible data will also be collected for control groups to allow counterfactual evaluation designs:

·Propensity score matching- based on pairing with similar researchers/companies and the development of panel data;

·Regression discontinuity design based on the comparison of the performance between successful and unsuccessful applicants (pending their approval on data use);

·Difference-in difference based on the comparison of the performance of beneficiaries before/after the Programme.

Management and implementation data for all parts of the Programme and all delivery mechanisms
[188](#footnote189)
 will continue to be collected in close to real-time. This data will be collected in a centrally managed and harmonised way through the Common Support Centre. It will also continue to be publicly available on a dedicated on-line portal in close to real-time allowing extraction per programme parts, types of actions and types of organisations (including specific data for SMEs). This will include inter alia proposals, applications, participations and projects (number, quality, EU contribution etc.); success rates; profiles of evaluators, applicants and participants (partly based on unique identifiers, and including country, gender, turnover, role in project etc.); implementation (including time-to-grant, error rate, satisfaction rate and the rate of risk taking etc.); and financial contribution to EU climate and environmental objectives and other mainstreaming targets. A yearly analysis of progress on key dimensions of the Framework Programme’s management and implementation will be carried out.

The evaluations of the new Framework Programme will ensure coherence of methodologies and comprehensiveness of coverage (i.e covering all programme parts and all delivery mechanisms). Evaluation of individual programme parts can continue to make use of specific indicators that complement relevant the Programme-level indicators. The evaluation of the Framework Programme will build on the coordinated evaluations of each programme part, type of actions and delivery mechanism according to common evaluation criteria and standard methodologies (incl. counterfactual analysis and qualitative approaches such as case studies). The comprehensive interim evaluation of the entire Framework Programme is foreseen by 2024, to draw the first lessons from the changes introduced in the new Framework Programme. A full-scale ex-post evaluation is planned by 2030 to provide a full assessment of the new Programme and report on the longer-term impacts of previous ones.

Lastly, evaluations will better account for the coordinated impact of R&I support at EU, national and regional level, building on existing work to better track the impact of EU R&I Programmes at national level
[189](#footnote190)
. The European RTD Evaluation Network
[190](#footnote191)
will provide the basis for a substantially increased cooperation with Member States and Associated States.

  

Figure 11 Intervention logic of Horizon Europe

 

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_07032.jpg)

Source: European Commission, DG Research and Innovation

:   [(1)](#footnoteref2)
     The Treaty requires that rules for participation and dissemination are adopted by the European Parliament and the Council in accordance with the ordinary legislative procedure.
:   [(2)](#footnoteref3)
     The Treaty on the Functioning of the European Union (TFEU) requires that a multiannual Framework Programme is adopted by the European Parliament and Council in accordance with the ordinary legislative procedure, and implemented through Specific Programmes adopted in accordance with the special legislative procedure.
:   [(3)](#footnoteref4)
     The Euratom Treaty provides the legal basis for promoting and facilitating nuclear research.
:   [(4)](#footnoteref5)
     European Commission (2017), 2017 Special Eurobarometer on Climate change. According to the 2017 Special Eurobarometer on Climate change, 92% of EU citizens see climate change as a serious problem, and 79 % of Europeans believe fighting climate change can boost the economy and create jobs.
:   [(5)](#footnoteref6)
     This initiative contributes in particular to the following Commission priorities: Jobs, Growth and Investment; Digital Single Market; Energy Union; Deeper and Fairer Internal Market; An Area of Justice and Fundamental Rights; Towards a New Policy on Migration; EU as Stronger Global Actor; and EU of Democratic Change. It contributes as well to the implementation of the 2030 Agenda on sustainable development, the EU Global Strategy, and new EU priorities, notably security, defence and migration, in line with the Rome declaration.
:   [(6)](#footnoteref7)
     See Annex 2 on Stakeholder consultation.
:   [(7)](#footnoteref8)
     European Commission (2017), The economic rationale for public R&I funding and its impact, Policy Brief Series, p. 23.
:   [(8)](#footnoteref9)
     In contrast, China's intensity is now higher, and South Korea's is more than double. The EU will need to train and employ at least one million new researchers, but the share of R&I personnel in the labour force increased marginally 2002-2015.
:   [(9)](#footnoteref10)
     LAB-FAB-APP, Investing in the European future we want, Lamy High Level Group Report (2017), p. 11
:   [(10)](#footnoteref11)
     “Deep tech” refers to companies founded around scientific discoveries or meaningful engineering innovations.
:   [(11)](#footnoteref12)
     European Commission (2017), Reflection paper on the future of EU finances.
:   [(12)](#footnoteref13)
     More evidence can be found in the Annex 4 on the EU added value of R&I.
:   [(13)](#footnoteref14)
     The EU has been investing in R&I since 1984. Over time, the share of the EU budget dedicated to R&I has increased.
:   [(14)](#footnoteref15)
     LAB-FAB-APP, Investing in the European future we want, Lamy High Level Group Report (2017), p. 11.
:   [(15)](#footnoteref16)
     European Commission (2018), Communication on the Horizon 2020 Interim Evaluation, COM(2018)2 final.
:   [(16)](#footnoteref17)
     European Commission (2017), Reflection paper on the future of EU finances.
:   [(17)](#footnoteref18)
     European Parliament (2017), REPORT on the assessment of Horizon 2020 implementation in view of its interim evaluation and the Framework Programme 9 proposal, EP T8-0253/2017.
:   [(18)](#footnoteref19)
     European Economic and Social Committee (2016), EESC information report INT/807, Horizon 2020 (evaluation).
:   [(19)](#footnoteref20)
     Committee of the Regions (2017), CoR Opinion SEDEC-VI/026, Local and Regional Dimension of the Horizon 2020 Programme and the New Framework Programme for Research and Innovation.
:   [(20)](#footnoteref21)
     European Research Area and Innovation Committee (2017), ERAC Opinion on the Interim Evaluation of Horizon 2020 and preparations for the next Framework Programme, ERAC 1207/17.
:   [(21)](#footnoteref22)
     Council of the European Union (2017), From the Interim Evaluation of Horizon 2020 towards the ninth Framework Programme - Council conclusions.
:   [(22)](#footnoteref23)
     European Commission (2018), A Modern Budget for a Union that Protects, Empowers and Defends, The Multiannual Financial Framework for 2021-2027, COM(2018) 321 final.
:   [(23)](#footnoteref24)
     European Parliament (2017), REPORT on the assessment of Horizon 2020 implementation in view of its interim evaluation and the Framework Programme 9 proposal, EP T8-0253/2017.
:   [(24)](#footnoteref25)
     The Euratom proposal is based on Article 7 of the Treaty establishing the European Atomic and Energy Community.
:   [(25)](#footnoteref26)
     PPMI (2017), Assessment of the Union Added Value and the Economic Impact of the EU Framework Programmes (FP7, Horizon 2020).
:   [(26)](#footnoteref27)
     Lab – Fab – App, Investing in the European future we want, Lamy High Level Group report, Annex 5, p. 32. Indeed, the Lamy High Level Group report identified no direct evidence of overall crowding-out effect of national funding. While some countries present simultaneously a decrease in national budget for R&D and an increase in EU contribution from the Framework Programme, this result is not systematic for all countries.
:   [(27)](#footnoteref28)
     European Commission (2018), A new, modern Multiannual Financial Framework for a European Union that delivers efficiently on its priorities post-2020, COM(2018)98 final.
:   [(28)](#footnoteref29)
     European Commission (2016) Response to the Report of the High Level Expert Group on the Ex Post Evaluation of the Seventh Framework Programme, COM(2016) 5 final.
:   [(29)](#footnoteref30)
     European Commission (2018), Horizon 2020 interim evaluation: maximising the impact of EU research and innovation, COM(2018)2.
:   [(30)](#footnoteref31)
     The open public stakeholder consultation on the Interim Evaluation received 3500 replies and 300 position papers.
:   [(31)](#footnoteref32)
     The discontinuation in Horizon 2020 of the automatic funding to organisations from Brazil, Russia, India, China and Mexico caused an important decrease of their participation.
:   [(32)](#footnoteref33)
     Conference proceedings available at 
    <https://publications.europa.eu/s/fC5N>
:   [(33)](#footnoteref34)
     European Commission (2017), Key findings of the Interim Evaluation.
:   [(34)](#footnoteref35)
     The economic impact of the Programme comes from the transformation of scientific excellence into innovations that generate economic outcomes: employment, exports, competitiveness, value-added and higher GDP.
:   [(35)](#footnoteref36)
     This multiplier is based on simulations done using the NEMESIS model and is consistent with figures provided in the Interim evaluation of Horizon 2020 (calculated over a period of 17 years) and in the ex-post evaluation of the 7th Framework Programme.
:   [(36)](#footnoteref37)
     The average GDP gain in RHOMOLO is 0.08%, the average gain in QUEST is up to 0.14% and the average gain in NEMESIS is 0.19%. NEMESIS results are based on Seureco (forthcoming), Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme. QUEST and RHOMOLO results were produced, respectively, by DG ECFIN and DG JRC.
:   [(37)](#footnoteref38)
     ibid.
:   [(38)](#footnoteref39)
     This figure is calculated for the EU-27 only and it is based on the NEMESIS model.
:   [(39)](#footnoteref40)
     Seureco (forthcoming), Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programmes.
:   [(40)](#footnoteref41)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 46.
:   [(41)](#footnoteref42)
     More than 14% of publications from the United States are in the top 10% most cited publications compared to 11% for EU publications (see 
    [Research and Innovation](Research and Innovation ) 
    <O>
    <bservatory)>
    <.>
     [When looking at the top 1% mos]( When looking at the top 1% mos)
    [t cited publications, the difference is even larger (50% more in the US than in the EU) (see](t cited publications, the difference is even larger (50% more in the US than in the EU) (see ) 
    S. Thomson, V. Kanesarajah (2017), The European Research Council – The first 10 years, Clarivate Analytics).
:   [(42)](#footnoteref43)
     Knowledge diffusion between business and academia remains lower in the EU than in the US (public-private co-publications per million-population stand at 50, over 35 points lower than in the US (see European Commission (2016), Science, Research and Innovation Performance of the EU).
:   [(43)](#footnoteref44)
     J. Allmendinger (2015), Quests for interdisciplinarity: a challenge for the ERA and Horizon 2020, RISE policy brief.
:   [(44)](#footnoteref45)
     RISE Group (2017), Europe's future: Open innovation, open science, open to the world; reflections of the Research, Innovation and Science Policy Experts (RISE) High Level Group, p. 65.
:   [(45)](#footnoteref46)
     Scientific quality is concentrated in a group of leading countries, predominantly in North-West Europe, but there are a number of small universities with a small number of excellent fields in less developed regions (source: Interim Evaluation of Horizon 2020).
:   [(46)](#footnoteref47)
     Increasingly, expertise and resources are abroad: 75% of knowledge (see European Commission (2016), Science, Research and Innovation performance of the EU) and 90% of market growth (see European Commission (2015), Trade for all, Towards a more responsible trade and investment policy) will be outside the EU over the next decade (see also European Commission (2017), Strengthening European Identity through Education and Culture, The European Commission's contribution to the Leaders' meeting in Gothenburg, p.4).
:   [(47)](#footnoteref48)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p.100.
:   [(48)](#footnoteref49)
     Lab – Fab – App, Investing in the European future we want, Lamy High Level Group report, p.8.
:   [(49)](#footnoteref50)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 59.
:   [(50)](#footnoteref51)
     Ibid.
:   [(51)](#footnoteref52)
     Social awareness is a constraining factor for the full-scale deployment of R&I-driven solutions required for societal transformation, but new and rapidly evolving technologies like robots and artificial intelligence raise concerns amongst citizens. In Europe, absence or uncertainty of demand for innovative goods and services are among the most cited obstacles to innovation, see also JRC Science for Policy Report (2016), Modes of Innovation.
:   [(52)](#footnoteref53)
     Flash Eurobarometer 433, Innobarometer 2016 – EU business innovation trends. This figure has increased by 14 percentage points between the last two releases of the Innobarometer (i.e. 2015 and 2016).
:   [(53)](#footnoteref54)
     Lab – Fab – App, Investing in the European future we want, Lamy High Level Group report, p.7.
:   [(54)](#footnoteref55)
     High-Level Strategy Group on Industrial Technologies (2018), Conference Document.
:   [(55)](#footnoteref56)
     Very few European start-ups survive beyond the critical phase of 2-3 years, and even fewer grow into larger mermaids. Less than 5% of European SMEs grow internationally. Venture capital in the EU is one-fifth the level of the USA.
:   [(56)](#footnoteref57)
     Less than half Europeans believe they have the skills to pursue entrepreneurial opportunities World Economic Forum, Enhancing Europe’s Competitiveness Fostering Innovation-driven Entrepreneurship in Europe, p16.
:   [(57)](#footnoteref58)
     European Commission (2017), ERA Progress Report 2016, Report from the Commission to the Council and the European Parliament, COM(2017) 35.
:   [(58)](#footnoteref59)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 119.
:   [(59)](#footnoteref60)
     Ibidem, p. 46.
:   [(60)](#footnoteref61)
     LAB-FAB-APP, Investing in the European future we want, Lamy High Level Group Report (2017), p.14.
:   [(61)](#footnoteref62)
     80-90% of stakeholders' position papers echo the Lamy High Level Group, recognise that Horizon 2020 is a success and do not call for changes to the basic structure of the programme.
:   [(62)](#footnoteref63)
     European Commission (2018), Communication on the Horizon 2020 Interim Evaluation, COM(2018)2 final, p.11.
:   [(63)](#footnoteref64)
     Research and experimental development (R&D) comprise creative and systematic work undertaken in order to increase the stock of knowledge – including knowledge of humankind, culture and society – and to devise new applications of available knowledge. The activity must be: novel, creative, uncertain, systematic, transferable and/or reproducible. (Frascati Manual, http://www.oecd.org/innovation/inno/frascati-manual.htm)
:   [(64)](#footnoteref65)
     Innovation is the implementation of a new or significantly improved product (good or service), or process, a new marketing method, or a new organisational method in business practices, workplace organisation or external relations. Innovation activities are all scientific, technological, organisational, financial and commercial steps which actually, or are intended to, lead to the implementation of innovations. Innovation activities also include R&D that is not directly related to the development of a specific innovation. (Oslo manual, http://www.oecd.org/science/inno/2367580.pdf)
:   [(65)](#footnoteref66)
     Griniece, E. (forthcoming) Synthesis of stakeholder input for Horizon Europe and European Commission analysis
:   [(66)](#footnoteref67)
     Rüttgers J., and al. (2018), Re-defining industry, Defining innovation, Report of the independent High Level Group on industrial technologies. On industry’s contribution and value to society, see also 
    <https://industry-changemakers.ert.eu/>
:   [(67)](#footnoteref68)
     Beckert B., et al. (2018), Visionary and Collaborative Research in Europe, Pathways to impact of use-inspired basic research, Fraunhofer Institute for Systems and Innovation Research, Austrian Institute of Technology.
:   [(68)](#footnoteref69)
     European Commission (2017), Annex 2 of the Interim Evaluation of Horizon 2020, SWD(2017) 221 final.
:   [(69)](#footnoteref70)
     Three examples of missions for pedagogical use are described in Mazzucato M. (2018), Mission-OrientedResearch & Innovation in the European Union.
:   [(70)](#footnoteref71)
     Key Enabling Technologies and digital technologies are instrumental in modernising Europe’s industrial base, to ensure that industry reduces its carbon footprint and embrace a circular economy approach. Moreover, industry could mobilise important industrial players and ensure participation of SMEs on social and political priorities.
:   [(71)](#footnoteref72)
     European Commission (2018), Annual Report on Research and Technological Development Activities of the European Union and Monitoring of Horizon 2020 in 2017.
:   [(72)](#footnoteref73)
     See Annex 2 on the Stakeholder Consultation.
:   [(73)](#footnoteref74)
     European Parliament (2017), Resolution of 14 March 2018 on the next MFF: Preparing the Parliament’s position on the MFF post-2020, ref. 2017/2052(INI).
:   [(74)](#footnoteref75)
     European Court of Auditors (2018), Future of EU finances: reforming how the EU budget operates, Briefing Paper.
:   [(75)](#footnoteref76)
     
    <http://www.bmub.bund.de/en/service/details-europe-and-environment/artikel/statement-of-green-growth-group-2/>
:   [(76)](#footnoteref77)
     
    <http://ec.europa.eu/budget/mff/lib/COM-2016-603/SWD-2016-299_en.pdf>
:   [(77)](#footnoteref78)
     
    <https://www.eca.europa.eu/en/Pages/DocItem.aspx?did=39853>
:   [(78)](#footnoteref79)
     Council conclusions 7495/17, adopted by ECOFIN on 21 March 2017, 
    <http://data.consilium.europa.eu/doc/document/ST-7495-2017-INIT/en/pdf>
:   [(79)](#footnoteref80)
     
    <https://publications.europa.eu/en/publication-detail/-/publication/1df19257-aef9-11e7-837e-01aa75ed71a1>
:   [(80)](#footnoteref81)
     European Commission (2016), A European strategy for low-emission mobility, COM(2016)0501 final.
:   [(81)](#footnoteref82)
     European Commission (2016), Clean Energy for all Europeans, COM(2016)0860 final.
:   [(82)](#footnoteref83)
     Among others, the Interim Evaluation of the Joint Undertakings,Interim evaluation of the European Institute of Innovation and Technology, FET Flagships – Interim evaluation.
:   [(83)](#footnoteref84)
     In particular, the High Level Group on maximising the impact of EU R&I programmes and the Research, Innovation and Science Policy Experts (RISE) group.
:   [(84)](#footnoteref85)
     For the evidence used in this impact assessment, please refer also to Annex 1.
:   [(85)](#footnoteref86)
     Deloitte (2016) Equity funding in the EU.
:   [(86)](#footnoteref87)
     The “Valley of Death” is commonly known as a market failure. “First valley of death” is associated to pre-commercial development of a product, with still high technical risks and unproven ability to generate revenue. Companies facing the “second valley of death” are in a more advanced stage of their lifecycle, and they are mainly looking for growth finance. However, private investors are deterred by unproven ability to scale-up rapidly and generate cash flow. In both cases technologies are seen too risky by private investors, and are, therefore, often not funded.
:   [(87)](#footnoteref88)
     European Investment Bank (2016) Restoring EU competitiveness p.36.
:   [(88)](#footnoteref89)
     European Commission (2017). Interim Evaluation of Horizon 2020, SWD(2017) 220, p.34.
:   [(89)](#footnoteref90)
     European Investment Bank (2018) Improving Access to Finance for Beneficiaries of the SME Instrument,.
:   [(90)](#footnoteref91)
     Ibid.
:   [(91)](#footnoteref92)
     Griniece, E. (forthcoming) Synthesis of stakeholder input for Horizon Europe and European Commission analysis .
:   [(92)](#footnoteref93)
     Breakthrough market-creating innovations are defined in Horizon 2020 as radically new, breakthrough products, services, processes or business models that open up new markets with the potential for rapid growth at European (and global) levels, in contrast to incremental innovation (improvements to existing products for existing markets).
:   [(93)](#footnoteref94)
     Additional evidence provided in Annex 8 on the European Innovation Council.
:   [(94)](#footnoteref95)
     To this end, a level playing field among competitors is key to unleashing the innovative potential of companies (especially SMEs) for breakthrough or disruptive innovation to happen.
:   [(95)](#footnoteref96)
     Technopolis (2017), Evaluation of the SME instrument and the activities under Horizon 2020 Work Programme "Innovation in SMEs".
:   [(96)](#footnoteref97)
     Ibid.
:   [(97)](#footnoteref98)
     European Commission (2018), Communication on the Horizon 2020 Interim Evaluation, COM(2018)2 final, p. 7. See also the specific recommendation in the Lamy High Level Group report on "adopting an impact-focused, mission-oriented approach" in future EU research and innovation programmes (LAB-FAB-APP, Investing in the European future we want, Lamy High Level Group Report (2017), p. 15-16.
:   [(98)](#footnoteref99)
     Democratic Society (2018), "Citizen Participation in FP9: A model for mission and work programme engagement". See p.18-19 for a more detailed overview.
:   [(99)](#footnoteref100)
     Ibid.
:   [(100)](#footnoteref101)
     Griniece, E. (2018), Synthesis of stakeholder input for Horizon Europe and European Commission analysis.
:   [(101)](#footnoteref102)
     Over 20 Focus Areas were introduced in Horizon 2020, and the interim evaluation found that "their multiplication resulted in some confusion" (p.149, In-Depth Staff Working Document on Horizon 2020 Interim Evaluation, SWD(2017) 220 final).
:   [(102)](#footnoteref103)
     Democratic Society (2018), p.18.
:   [(103)](#footnoteref104)
     "There is much evidence that EU scale R&I missions would be best serves in a hybrid model (including or combining accelerator and transformer elements), that is flexible in addressing different types of challenges and different levels of complexity, while at the same coordinating and concentrating the effort and resources towards the commonly agreed objectives". Joint Institute for Innovation Policy (2018), Mission-Oriented Research and Innovation: assessing the impact of a mission-oriented research and innovation approach.
:   [(104)](#footnoteref105)
     Mazzucato M. (2018), Mission-Oriented Research and Innovation in the European Union: A problem-solving approach to fuel innovation-led growth.
:   [(105)](#footnoteref106)
     This is identified as a key characteristic of the most successful mission-like initiatives across the world. See: Joint Institute for Innovation Policy study.
:   [(106)](#footnoteref107)
     "Missions require to set up specific governance structures with full-time professionals and to keep close contacts with all stakeholders. A balanced system of separation of powers between steering, strategic and financial decision-making and the day-to-day management is a must to establish from the outset". Joint Institute for Innovation Policy study.
:   [(107)](#footnoteref108)
     https://ec.europa.eu/research/innovation-deals/index.cfm
:   [(108)](#footnoteref109)
     European Commission (2018), Communication on the Horizon 2020 Interim Evaluation, COM(2018)2 final, p. 8.
:   [(109)](#footnoteref110)
     Griniece, E. (forthcoming) Synthesis of stakeholder input for Horizon Europe and European Commission analysis .
:   [(110)](#footnoteref111)
     See Annex 10 on the Implementation of the strategy for international cooperation in R&I.
:   [(111)](#footnoteref112)
     Within the Programme, peer-reviewed publications with at least one associated or third country have a higher impact than other ones: European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 115.
:   [(112)](#footnoteref113)
     European Commission (2018), Communication on the Horizon 2020 Interim Evaluation, COM(2018)2 final, p.9.
:   [(113)](#footnoteref114)
     Ibid.
:   [(114)](#footnoteref115)
     Griniece, E. (forthcoming) Synthesis of stakeholder input for Horizon Europe and European Commission analysis .
:   [(115)](#footnoteref116)

    The effect of emulating or aligning Member States funding policies to match these of Horizon 2020 with respect to open access is clearly reported by Member States in the National Point of Reference (NPR) report of 2015) and can be seen in many instances, for example in aligning embargo periods (p. 16). Similar trends can be observed in the 2017 NPR report, where 2/3 of Member States report that the 2012 Recommendation for Open Access to and Preservation of Scientific Information has had significant impact on national policies.
:   [(116)](#footnoteref117)
     
    <https://ufm.dk/en/publications/2018/preliminary-analysis-introduction-of-fair-data-in-denmark>
:   [(117)](#footnoteref118)
     European Commission (2018), Communication on the Horizon 2020 Interim Evaluation, COM(2018)2 final, p. 9.
:   [(118)](#footnoteref119)
     Ibid.
:   [(119)](#footnoteref120)
     Griniece, E. (forthcoming) Synthesis of stakeholder input for Horizon Europe and European Commission analysis .
:   [(120)](#footnoteref121)
     Specific partnerships, whether new or renewed, are not included in the legal proposal of the Framework Programme.
:   [(121)](#footnoteref122)
     As proposed by the ERAC ad-hoc working group on partnerships (2018)
:   [(122)](#footnoteref123)
     The impacts of the changes were quantified based on the NEMESIS model only. As shown in Annex, 5, the QUEST and RHOMOLO models provide lower results in terms of GDP gain for the baseline scenario.
:   [(123)](#footnoteref124)
     Seureco (forthcoming) Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme,.
:   [(124)](#footnoteref125)
     These benefits are estimated after 2021 based on the NEMESIS model. Source: Seureco (forthcoming) Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme,.
:   [(125)](#footnoteref126)
     Costs are based on Horizon 2020 figures.
:   [(126)](#footnoteref127)
     The Interim Evaluation of Horizon 2020 shows that the estimated cost for applicants to write proposals is EUR 1908.9 million or EUR 636 million annually. Of these costs, it is estimated that EUR 1.7 billion would be spent on writing proposals that do not get funded, including EUR 643.0 million for non-funded high quality proposals alone.
:   [(127)](#footnoteref128)
     The administrative burden of reporting obligations were estimated based on the standard cost model. The total burden is obtained by multiplying: (1) Average personnel cost per hour: based on data from the R&D surveys (Eurostat), the average cost of R&D personnel per FTE R&D staff is EUR 4927 per month in the EU. Based on this, a gross salary range of EUR 4000-6000 per month is assumed for the calculations (20% around the EU average). This corresponds to an hourly wage of EUR 25 to 37.5 per hour. In line with the better regulation guidelines, the hourly pay to be used in the standard cost model corresponds to this gross salary plus overhead costs (25%). This gives a range of EUR 31.25 to 46.88 per hour. (2) Time required per reporting obligation: the duration of the tasks required to fulfil a reporting obligation is estimated to range between 4 and 8 hours. (3) Number of projects: about 11,100 projects were launched during the first three years of Horizon 2020. This corresponds to 25,900 over 7 years. (4) Number of reporting obligations: based on data from Horizon 2020 projects, an average of two reporting obligations per project is assumed.
:   [(128)](#footnoteref129)
     The administrative expenditure related to the evaluation of proposals and the management of projects is below 5% of the budget. More extensive use of executive agencies since 2014 (REA, ERCEA, INEA and EASME) promoted economies of scale and increased synergies. As a result, administrative expenditure was drastically reduced (compared to 6% in FP7). At the same time, the level of client satisfaction is very high. Therefore, a rate of 5% is a reasonable assumption for the next Framework Programme. This corresponds to an estimated cost of EUR 500 to 600 million per year.
:   [(129)](#footnoteref130)
     European Commission (2017), The Grand Challenge. The design and societal impact of Horizon 2020.
:   [(130)](#footnoteref131)
     The success rate in Horizon 2020 is 11.6%, compared to 18.5% under the previous framework programme (FP7).
:   [(131)](#footnoteref132)
     Proposals that passed all thresholds in the independent evaluation process (from Horizon 2020 Interim Evaluation).
:   [(132)](#footnoteref133)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 83.
:   [(133)](#footnoteref134)
     LAB-FAB-APP, Investing in the European future we want, Lamy High Level Group Report (2017), p.10.
:   [(134)](#footnoteref135)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 87-88.
:   [(135)](#footnoteref136)
     European Commission (2017), Reflection paper on the future of finance, p. 26.
:   [(136)](#footnoteref137)
     In calls under the Horizon 2020 Societal Challenge 7 "Secure Societies", the success rate reached 20% by imposing strict eligibility criteria.
:   [(137)](#footnoteref138)
     European Commission (2018), Communication on the Horizon 2020 Interim Evaluation, COM(2018)2 final, p.5.
:   [(138)](#footnoteref139)
     LAB-FAB-APP, Investing in the European future we want, Lamy High Level Group Report (2017), p.18.
:   [(139)](#footnoteref140)
     See also Annex 11 on the simplification checklist.
:   [(140)](#footnoteref141)
     European Commission (2016), Report on the Horizon 2020 Simplification Survey.
:   [(141)](#footnoteref142)
     LAB-FAB-APP, Investing in the European future we want, Lamy High Level Group Report (2017), p.22.
:   [(142)](#footnoteref143)
     This is complemented by separate Work Programmes for the European Research Council, the Euratom, the Joint Research Centre, and the Strategic Innovation Agenda for the European Institute of Innovation and Technology (EIT).
:   [(143)](#footnoteref144)
     For instance, an emergency procedure to swiftly allocate funds to a particular purpose can be activated through WP updates, as happened in Horizon 2020 to tackle the outbreaks of Ebola and Zika.
:   [(144)](#footnoteref145)
     At the request of the European Parliament during inter-institutional negotiations, the scope of derogations were set out in the RfP for Art. 187 TFEU initiatives while for Art. 185 TFEU initiatives, these are laid down in the respective basic acts.
:   [(145)](#footnoteref146)
     Interim Evaluation of the SESAR Joint Undertaking (2014-2016) operating under Horizon 2020, p. 53.
:   [(146)](#footnoteref147)
     Since 2007, two Participant Guarantee Funds were created (EU and Euratom) to protect from non-recovery of sums due to the Union and to allow ongoing projects to continue in case of default of one of the beneficiaries.
:   [(147)](#footnoteref148)
     Non-profit organisations are reimbursed 100% also in Innovation Actions.
:   [(148)](#footnoteref149)
     Except subcontracting financial support to third parties, and in-kind contributions not used on the beneficiary's premises.
:   [(149)](#footnoteref150)
     The following types of actual costs can be declared as eligible: personnel costs, sub-contracting, purchase of goods, services or works (incl. travel costs), financial support to third parties and costs incurred by third parties.
:   [(150)](#footnoteref151)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017)
:   [(151)](#footnoteref152)
     European Commission (2016), Report on Horizon 2020 simplification survey.
:   [(152)](#footnoteref153)
     The Marie Skłodowska Curie Actions are fully funded by a set of unit costs.
:   [(153)](#footnoteref154)
     The European Court of Auditors (2018) “
    [A contribution to simplification of EU research programme beyond Horizon 2020](https://www.eca.europa.eu/Lists/ECADocuments/Briefing_paper_H2020/Briefing_paper_H2020_EN.pdf)
    ”
:   [(154)](#footnoteref155)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 140.
:   [(155)](#footnoteref156)
     Ibid. p. 84.
:   [(156)](#footnoteref157)
     For the ERC, only the Excellence criterion applies. Under Innovation Actions in Horizon 2020, Impact has a higher weight.
:   [(157)](#footnoteref158)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 236.
:   [(158)](#footnoteref159)
     Ibid., p.200
:   [(159)](#footnoteref160)
     Commission’s proposals for the 2014-2020 Multiannual Financial Framework (MFF).
:   [(160)](#footnoteref161)
     PPMI (2016), Evaluation of the operation of ERCEA (2012-2015), final report; and PPMI (2016), Evaluation of the operation of REA (2012-2015), final report.
:   [(161)](#footnoteref162)
     This could also become a formal Commission document such as a Communication or Staff Working Document.
:   [(162)](#footnoteref163)
     While the focus would be on the programmable Global Challenges and Industrial Competitiveness pillar, the relationship between this and the bottom-up parts such as the EIC, including the results from these, would feed into the planning process.
:   [(163)](#footnoteref164)
     This will reflect the expected impact of missions of up to 15 years, as appropriate.
:   [(164)](#footnoteref165)
     In the case of the ERC, the Scientific Council will continue to establish the overall strategy, the Work Programme and the proposal evaluation and selection. The JRC will also continue to establish its own Work Programme and strategy and receive opinions from Member States through its Board of Governors. The EIC will also develop its own Work Programme. As regards the EIT, the specific priority fields, financial needs, time schedule, selection process and implementation of KICs will be defined in the EIT Strategic Innovation Agenda (SIA) as a separate legal base arising from the EIT founding regulation. Proposals for future EIT KICs indicated in the EIT Strategic Innovation Agenda (SIA) should take into account the outcomes of the strategic planning process.
:   [(165)](#footnoteref166)
     European Commission (2017), Financial Regulation applicable to the general budget of the Union and its rules of application, available at: 
    <http://ec.europa.eu/budget/library/biblio/documents/regulations/financial_regulation_2017_en.pdf>
:   [(166)](#footnoteref167)
     Except for subcontracting, financial support to third parties and unit costs for internally invoiced goods and service are calculated in accordance with the usual cost accounting practices of the beneficiaries. Such unit costs shall be determined on the basis of actual eligible direct and indirect costs.
:   [(167)](#footnoteref168)
     As shown in the Interim Evaluation of Horizon 2020, too much oversubscription could cause disillusionment and dissatisfaction, leaving good proposals unfunded and to be resubmitted.
:   [(168)](#footnoteref169)
     European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 79.
:   [(169)](#footnoteref170)
     The acceptance of other cost items will be further defined in the model grant agreement, as in the current system.
:   [(170)](#footnoteref171)
     These conditions (e.g. beneficiaries must be able to identify their actual eligible indirect costs) will be further developed in the model grant agreement.
:   [(171)](#footnoteref172)
     The European Court of Auditors (2018) “A contribution to simplification of EU research programme beyond Horizon 2020”
:   [(172)](#footnoteref173)
     Project-based remuneration means remuneration that is linked to the participation of a person in projects, is part of the beneficiary’s usual remuneration practices and is paid in a consistent manner.
:   [(173)](#footnoteref174)
     European Commission (2017), Reflection paper on the future of EU finances, p.26.
:   [(174)](#footnoteref175)
     High-Level Group of Innovators (2018), Europe is back: accelerating breakthrough innovation.
:   [(175)](#footnoteref176)
    Europe's innovators struggle to access risk finance above the €10 million range. PwC/CB Insights, Money Tree Report Q4 2017, p. 93. Funding rounds of companies above $100 million are five times higher in the US and Asia than Europe (p. 92).
:   [(176)](#footnoteref177)
     Martinuzzi, A. et al. (2016), Network Analysis of Civil Society Organisations’ participation in the EU Framework Programmes, Vienna and Leicester.
:   [(177)](#footnoteref178)
     The administrative expenditure in FP7 represented 5.16% of the total budget of the programme (indirect actions). The Interim Evaluation of Horizon 2020 shows that, over the first three years, its administrative expenditure is below the 5% target and is particularly low for the executive agencies.
:   [(178)](#footnoteref179)
     PPMI (2016), Evaluation of the operation of ERCEA (2012-2015), final report; and PPMI (2016), Evaluation of the operation of REA (2012-2015), final report.
:   [(179)](#footnoteref180)
     For example, INEA implements the Connecting Europe Facility Programme (large energy, transport, digital infrastructures projects) as well as Horizon 2020 Societal Challenges.
:   [(180)](#footnoteref181)
     Up to 82% for REA and up to 93% for ERCEA of the beneficiaries are satisfied with the performance of the agencies. See PPMI (2016), Evaluation of the operation of ERCEA (2012-2015), final report; and PPMI (2016), Evaluation of the operation of REA (2012-2015), final report.
:   [(181)](#footnoteref182)
     A total of 86% respondents to the cluster-based public consultation on EU funds in the area of investment, research & innovation, SMEs and single market reported having experience with the Horizon 2020 program. From this sample, the respondents reported having experience also with European Structural and Investment funds (22%), EU Health Programme (9%), COSME (8.%).
:   [(182)](#footnoteref183)
     The ‘second pillar’ of the CAP focuses on rural development and complements the system of direct payments to farmers and measures to manage agricultural markets (the so-called ‘first pillar’)
:   [(183)](#footnoteref184)
    The Seal of Excellence scheme, launched in 2015, is a quality label recognising proposals submitted to Horizon 2020 calls which were evaluated as high-quality but were not funded due to lack of available budget. The holder of a Seal of Excellence can approach other sources of funding (regional, national, private, public) with this quality label.
:   [(184)](#footnoteref185)
     The future External Instrument will merge the following instruments: European Development Fund, Development Cooperation Instrument; European Neighbourhood Instrument; Partnership Instrument for Cooperation with Third Countries; European Instrument for Democracy and Human Rights; Instrument contributing to Stability and Peace; Instrument for Nuclear Safety Cooperation, and the Common Implementing Rules post-2020.
:   [(185)](#footnoteref186)
     See 
    <https://sustainabledevelopment.un.org/post2015/transformingourworld>
:   [(186)](#footnoteref187)
     Including Missions and European Partnership Initiatives
:   [(187)](#footnoteref188)
     Share of GDP invested in research and development; evolution of the Innovation Output Indicator, share of researchers as part of the active population.
:   [(188)](#footnoteref189)
     Including European Partnerships.
:   [(189)](#footnoteref190)
     European Research Area and Innovation Committee (2017), Final Report of the ERAC Ad-hoc Working Group on Measuring the Impact of EU Framework Programmes for Research and Innovation at National Level. Available at: 
    <http://data.consilium.europa.eu/doc/document/ST-1206-2017-INIT/en/pdf>
    .
:   [(190)](#footnoteref191)
     More information available at: 
    <https://ec.europa.eu/research/evaluations/index.cfm?pg=network>
    <.>

[Top](#document1)

![european flag](./../../../images/eclogo.jpg)EUROPEAN COMMISSION

Brussels,7.6.2018

SWD(2018) 307 final

COMMISSION STAFF WORKING DOCUMENT  
  
IMPACT ASSESSMENT

Accompanying the document

Proposals for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing Horizon Europe – the Framework Programme for Research and Innovation, laying down its rules for participation and dissemination  
  
DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on establishing the specific programme implementing Horizon Europe – the Framework Programme for Research and Innovation  
  
COUNCIL REGULATION establishing the Research and Training Programme of the European Atomic Energy Community for the period 2021-2025 complementing Horizon Europe – the Framework Programme for Research and Innovation

{COM(2018) 435 final}  
  
{COM(2018) 436 final}  
{COM(2018) 437 final}  
{SEC(2018) 291 final}  
  
{SWD(2018) 308 final}  
  
{SWD(2018) 309 final}

Annexes

Annex 1: Procedural information
   

1
   Lead DG(s), Decide Planning, CWP Reference
   

2
   Organisation and timing
   

3
   Consultation of the Regulatory Scrutiny Board
   

4
   Evidence, sources and quality
   

Annex 2: Stakeholder consultation
   

1
   Objectives
   

2
   Target groups
   

3
   Consultation methods and tools
   

4
   Methodology and tools used to process the data
   

5
   Results of the stakeholder consultation
   

6
   Inclusion of the stakeholder consultation results in the legal proposal
   

Annex 3: Evaluation results
   

1
   Lessons from the evaluations of previous Framework Programmes
   

2
   Lessons learnt from the Interim Evaluation of Horizon 2020
   

Annex 4: Added Value of EU-funded R&I
   

Annex 5: Macroeconomic modelling

1
   NEMESIS
   

2
   QUEST
   

3
   RHOMOLO
   

4
   Comparison of results
   

Annex 6: Indicators
   

1
   Key Impact Pathways Indicators
   

2
   Key Management and Implementation Data
   

Annex 7: Synergies with other proposals under the future Multiannual Financial Framework
   

1
   Why do we need synergies between EU programmes?
   

2
   The role of the Framework Programme in the EU R&I support system
   

3
   Synergies with the European Regional Development Fund (ERDF)
   

4
   Synergies with the European Social Fund (ESF+)
   

5
   Synergies with the EU programmes for agricultural and maritime policy
   

6
   Synergies with the Single Market Programme
   

7
   Synergies with the InvestEU Fund
   

8
   Synergies with the Connecting Europe Facility
   

9
   Synergies with the Digital Europe Programme
   

10
   Synergies with the Programme for Environment & Climate Action (LIFE)
   

11
   Synergies with Erasmus
   

12
   Synergies with the Neighbourhood, Development and International Cooperation Instrument

13
   Synergies with the European Space Programme
   

14
   Synergies with the Innovation Fund under the EU Emissions Trading System
   

15
   Relevant studies
   

Annex 8 Detailed information on key improvements in the design of Horizon Europe
   

1
   European Innovation Council (EIC)
   

2
   Research and Innovation Missions
   

3
   International R&I cooperation
   

4
   Open Science
   

5
   European Partnerships
   

6
   Strengthening the European Research Area - Sharing excellence
   

7
   Support to policy-making: activities of the Joint Research Centre in Horizon Europe
   

8
   European Institute of Innovation and Technology (EIT)
   

9
   Support to education in Horizon Europe
   

Annex 9 - Rules for Participation
   

1
   Single set of rules
   

2
   Funding model and types of action
   

3
   Forms of grants
   

4
   Further simplification/flexibility
   

5
   Use of grants, financial instruments and budgetary guarantees
   

6
   Proposal selection and evaluation, including experts

7
   Audits and controls
   

8
   Intellectual Property Rights, including “Exploit in the EU”
   

9
   Dissemination and exploitation of results
   

Annex 10: Implementation of the Strategy for international cooperation in R&I
   

1
   Reinforcing the international dimension of the EU R&I Framework Programme
   

2
   Improving the framework conditions for engaging in international cooperation
   

3
   Leading multilateral initiatives - working with international organisations on global challenges
   

4
   Reinforcing the partnership with Member States
   

5
   Intensifying the synergies with the EU's external policies
   

6
   Refining the communication strategy
   

7
   Conclusions
   

Annex 11: Simplification checklist
   

 

Annex 1: Procedural information

1Lead DG(s), Decide Planning, CWP Reference

The Impact Assessment of the future Framework Programme for Research and Innovation is the result of a collective work carried out under the leadership of DG RTD with the R&I-family DGs, including AGRI, CNECT, EAC, ENER, GROW, HOME, JRC, MOVE.

CWP Reference: COM(2017) 650 final

2Organisation and timing

This Impact Assessment has benefited from co-creation with the following working groups: the internal RTD IA Penholder Group, the RTD Indicator task team, the informal R&I IA working group. The work was steered at senior management level through discussions at the R&I-family DG meetings, as well as at the Inter-Service Steering Group on Horizon Europe (including the R&I-family and BUDG, CLIMA, COMP, DIGIT, ECFIN, ENV, EMPL, MARE, REGIO, SJ, SANTE, SG, TRADE). In addition, workshops open to all services were held on indicators with external experts and on synergies between the Framework Programme and other EU programmes.

The following milestones constitute the bulk of the general chronology of the Impact Assessment:

|  |  |
| --- | --- |
| Date | Activity |
| 10 January 2018 | Launch of Cluster Stakeholder Consultation (8 weeks) |
| 17 January 2018 | Upstream meeting with RSB |
| 19 January 2018 | 1st Informal R&I-family meeting |
| 2 February 2018 | 2nd Informal R&I-family meeting |
| 16 February 2018 | 3rd Informal R&I-family meeting |
| 21 February 2018 | Workshop with experts on indicators |
| 27 February 2018 | First formal ISSG meeting chaired by SG |
| 2 March 2018 | 4th Informal R&I-family meeting |
| 6 March 2018 | R&I DG meeting |
| 9 March 2018 | End of cluster consultation |
| 19 March 2018 | Second formal ISSG meeting chaired by SG |
| 21 March 2018 | Submission to the RSB |
| 11 April 2018 | RSB meeting |
| 26 April 2018 | Third ISSG meeting on the legal proposal |
| 4 May 2018 | Launch of ISC (duration: until 16 May 2018) |
| 8 May 2018 | Fourth ISSG meeting |
| 7 June 2018 | Adoption |

  

3Consultation of the Regulatory Scrutiny Board

The Regulatory Scrutiny Board (RSB) gave a positive opinion (with reservations) to a draft version of this impact assessment. The main text and annexes were adjusted following the recommendations of the RSB. In particular, significant work was conducted to ensure consistency between challenges, objectives, structure and impacts. All revisions were done to ensure that the assessment relies on a solid methodology that meets the RSB standards. The Board's recommendations covered the following key aspects.

(1) The report does not sufficiently describe the balance between the new three pillars of the programme. It does not spell out the rationale, risks, and implications of the proposed structure and priorities. This applies in particular to the Global Challenges pillar (pillar 2).

|  |  |
| --- | --- |
| 1 Pillar structure and objectives | |
| The report should better explain and justify its proposed three pillars' structure. | Text revised in section 3.1. |
| It should clearly explain how FP9 objectives will differ from Horizon 2020. | Text revised in section 2.3 to address this point. |
| It should better derive the proposed changes to the current structure of Horizon 2020 from lessons learned and stakeholders’ input. This is particularly relevant for the second pillar on Global Challenges where the exact scope and implications of the proposed structure should be substantiated. | New text added in 3.1.  Boxes with stakeholders’ inputs added throughout the text, in particular for each design novelty. Sections in annex on stakeholder consultation revised. |
| The report should also confirm that the strengthened emphasis on innovation and support to close-to-market initiatives will not happen at the expense of basic research.  In this respect, the report should clarify how the concerns expressed by stakeholders on the need for a balanced integration of social sciences and humanities is taken on board. | New text added in 3.1. |
| In that respect, an indication of the expected breakdown of resources across the different pillars and within each pillar would provide useful information on the “centre(s) of gravity” of the future programme. | New text added in 3.1. |

(2) The report does not show the rationale and value added of the additional structures and initiatives for the next framework programme, such as the European Innovation Council or the “R&I missions”.

|  |  |
| --- | --- |
| 2 Proposed novelties | |
| The report should better demonstrate that the proposed novelties build on sound foundations and will effectively address key challenges identified for the next framework programme. It should transparently present possible risks and trade-offs associated with the introduction of these new instruments. | Text revised in the introduction of 3.2. References added overall and for the different novelties. All sections on novelties reinforced in order to strengthen their rationale and added value. New sections “what are the risks?” added for each design novelty. |
| In the case of the European Innovation Council, the report should better analyse its structure, governance, beneficiaries, optimal scale and functioning. It should better demonstrate that the EIC addresses a legitimate unmet demand from innovators that cannot be met more efficiently and competently through other means or existing structures such as the EU Institute for Innovation and Technology (EIT) or the Joint Research Centre.  It should describe how it builds on the experience of providing support to innovative SMEs.  It should explain its complementarity with the EIT and other instruments in existing programmes supporting various stages and forms of innovation. | Main text and annex revised for EIC. Section on blended financed updated. Structure of EIC clarified. Governance, beneficiaries and functioning detailed in the annex. Optimal scale covered by providing figures on the equity funding gap. |
| The report should also better position the concept of “R&I missions” in the overall proposed structure of the programme and explain whether they will replace the current “focus areas”, how “R&I missions” differ from and/or intend to build on them. The report should more convincingly explain how the overall governance and practical organisation of the “R&I missions” will deliver on the expected societal engagement and ownership, while ensuring timely progress and tangible impacts. The report should clarify the expected interaction between “R&I missions” and the EU regulatory framework. | Text added on overarching approach of missions in section 3.1. Missions section & annex revised accordingly. |
| The report should also provide safeguards and mitigation measures protecting against potential risks associated with its proposed bottom up approach to supporting innovation, in particular in terms of respect of EU values, ethical approach and conflicts of interest.  It should strengthen the case for publicly supporting close-to-market initiatives with high long-term profit potential by explaining how citizens and public authorities will reap the benefits of such high-risk public investments. | Sections on risks added for each design novelty, including EIC. Section and + annex on EIC revised accordingly |

(3) The report does not convincingly demonstrate that the new programme will effectively streamline its delivery mechanisms, including the partnerships landscape.

|  |  |
| --- | --- |
| 3 Simplification, notably rationalisation of partnerships | |
| The delivery mechanisms should more clearly emphasise the simplification proposed in the various instruments that will serve to implement the next framework programme.  This concerns notably the rationalisation of the partnerships landscape for which the programme should more clearly state its ambitions. Currently the report does not demonstrate, in many instances, that FP9 will be less burdensome and less costly for the beneficiaries.  A mapping of instruments used in the current and proposed in the new programme could usefully illustrate such simplification efforts | Simplification aspect reinforced throughout the text. Section and annex on partnerships revised. Revisions in section 4 in several places. Table with continued and discontinued instruments added in section 4. |

|  |  |
| --- | --- |
| 4 Latest MFF developments, notably synergies | |
| The report should reflect the latest developments, as they become known, concerning the overall Multiannual Financial Framework. Notably in the area of synergies across programmes, it should provide more tangible elements on concrete measures to ensure that they are fully exploited. This concerns for instance the interfacing with the Digital Europe Programme, InvestEU, and the European University Networks in Erasmus+. | Section and annex on synergies revised. |

|  |  |
| --- | --- |
| Other | |
| The Board notes that this impact assessment will eventually be complemented with specific budgetary arrangements and may be substantially amended in line with the final policy choices of the Commission’s MFF proposal. | Box in 1.1.1 added. The impact assessment does not make any budget assumption (except for the baseline scenario in the economic models), therefore no drastic change was required after the MFF proposal related to the amount itself. Sections on synergies revised. |

  

4Evidence, sources and quality

Figure 1 Evidence used for the impact assessment

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08002.jpg)

Findings from previous evaluations are used throughout the document. The impact assessment is strongly guided by the results from the interim evaluation of Horizon 2020 and related evaluations, which include:

·European Commission (2017), Interim evaluation of Horizon 2020, Staff Working Document (SWD). The interim evaluation of Horizon 2020 (major reference used throughout the impact assessment)

·European Commission (2017), Interim Evaluation of the Joint Undertakings (JUs) operating under Horizon 2020, Staff Working Document (SWD).

·European Commission (2017), Interim evaluation of the European Institute of Innovation and Technology (EIT), Staff Working Document (SWD).

·European Commission (2017), FET Flagships – Interim evaluation.

·Joint Research Centre Implementation Review 2017: In the context of the Interim Evaluation of Horizon 2020. DG JRC, July 2017.

For this impact assessment, several references are made in particular to the recommendations and findings of the High Level Group chaired by Pascal Lamy. The mandate of this High Level Group was to provide advice on how to maximise the impact of the EU's investment in research and innovation. Reports from high level groups used for this impact assessment include:

·LAB – FAB – APP: Investing in the European future we want, Report of the independent High Level Group on maximising the impact of EU Research & Innovation Programmes, July 2017.

·Funding - Awareness - Scale - Talent (FAST): Europe is back: Accelerating Breakthrough Innovation, Full set of recommendations from the Independent High-Level Group of Innovators on establishing a European Innovation Council, 2018.

·Mission-Oriented Research and Innovation in the European Union: A problem-solving approach to fuel innovation-led growth, by Mariana Mazzucato. February 2018.

·Mission-Oriented Research and Innovation: Assessing the impact of a mission-oriented research and innovation approach. Study coordinated by the Joint Institute for Innovation Policy, February 2018.

·Mission-Oriented Research and Innovation Policy: A RISE Perspective, February 2018.

·Open Innovation, Open Science, Open to the World, Reflections of the Research, Innovation and Science Policy Experts (RISE), March 2017.

·High Level Group; Towards a Mission-Oriented Research and Innovation Policy in the European Union: An ESIR Memorandum, December 2017.

Several documents produced by the Commission and other institutions were used, including:

·Committee of the Regions (2017), CoR Opinion SEDEC-VI/026, Local and Regional Dimension of the Horizon 2020 Programme and the New Framework Programme for Research and Innovation.

·Council of the European Union (2017), From the Interim Evaluation of Horizon 2020 towards the ninth Framework Programme - Council conclusions.

·European Commission (2017), Reflection paper on the future of EU finances.

·European Commission (2017), The economic rationale for public R&I funding and its impact, Policy Brief Series.

·European Commission (2018), Communication on the Horizon 2020 Interim Evaluation, COM(2018)2 final.

·European Parliament (2017), REPORT on the assessment of Horizon 2020 implementation in view of its interim evaluation and the Framework Programme 9 proposal, EP T8-0253/2017.

·European Economic and Social Committee (2016), EESC information report INT/807, Horizon 2020 (evaluation).

·European Research Area and Innovation Committee (2017), ERAC Opinion on the Interim Evaluation of Horizon 2020 and preparations for the next Framework Programme, ERAC 1207/17.

In addition to the existing literature of studies and reports related to research and innovation, external studies were launched in the context of this impact assessment on specific issues:

·On economic modelling: Seureco (2018), Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme.

·On the impact of missions: Mission-Oriented Research and Innovation: assessing the impact of a mission-oriented research and innovation approach. The Joint Institute for Innovation Policy, Joanneum Research, Tecnalia, TNO, VTT, the Danish Technological Institute, and Valdani Vicari & Associati (2018).

·On Future and Emerging Technologies: Beckert B., et al. (2018), Visionary and Collaborative Research in Europe, Pathways to impact of use-inspired basic research, Fraunhofer Institute for Systems and Innovation Research, Austrian Institute of Technology.

·On foresight: Ricci, A. et al. (2017), Beyond the Horizon: Foresight in Support of the Preparation of the European Union’s Future Policies in Research and Innovation.

·On EU added value: PPMI (2017), Assessment of the Union Added Value and the Economic Impact of the EU Framework Programmes (FP7, Horizon 2020).

Various consultation methods and tools were used (see Annex 2), including events, conferences, workshops.

The quantification of the overall expected impact of the Programme relies on economic modelling (see Annex 5). Internal and external expertise was mobilised:

·Results from the NEMESIS model were produced by an external contractor (Seureco). DG JRC and DG ECFIN were part of the committee steering the related study to ensure the quality of the results.

·Results from the QUEST model were produced by DG ECFIN.

·Results from the RHOMOLO model were produced by DG JRC.

Internal expertise was used to ensure the overall quality of the impact assessment by triangulating these different sources of information, organising several meetings and participatory workshops with experts from the Commission on dedicated topics and ensuring continuous exchanges between Commission services. The approach and results have been discussed and validated during senior management and inter-service meetings.

Annex 2: Stakeholder consultation

1Objectives

The aim of stakeholder consultations was to seek the views of EU Research and Innovation (R&I) stakeholders on the key elements of the design of the post 2020 EU programme for R&I. The results of the stakeholder consultation feed into the Impact Assessment for the programme and help to shape the drafting of the legal text.

Previous stakeholder consultations used for this impact assessment include the following:

·the Horizon 2020 Stakeholder Consultation completed in January 2017 organised in the context of the Interim evaluation of Horizon 2020 (3,500 responses and 300 position papers)
[1](#footnote2)
;

·the European Innovation Council Call for ideas completed in April 2016 (1,000 respondents and 100 position papers)
[2](#footnote3)
.

2Target groups

In preparation to the stakeholder consultation activities a mapping of the key stakeholders was carried out. They mainly include the EU and global umbrella organisations and institutions relevant to the EU R&I policy field and the decision-making process. The consultations were, however, also meant to reach citizens in general and involve them in the discussion on the future of R&I in Europe.

3Consultation methods and tools

A mix of consultation activities came in different moments of the Impact Assessment work to ensure stakeholder views are systematically accounted for in the design of Horizon Europe.

To tailor for different information needs, consultation activities ranged from stakeholder conferences and events, to expert groups, an on-line consultation, workshops, meetings and seminars and analysis of the position papers.

Table 1 Consultation process

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  | I. Preparatory phase | | | II. Assessment and design phase | | III. Validation phase |
|  | Q1-2017 | Q2-2017 | Q3-2017 | Q4-2017 | Q1-2018 | Q2-2018 |
| 3.1 Conferences and events |  |  |  |  |  |  |
| §Research & Innovation – Shaping our Future |  |  |  |  |  |  |
| §European Research Excellence: Impact and value for society |  |  |  |  |  |  |
| 3.2 Expert groups |  |  |  |  |  |  |
| §HLG on maximising the impact of European research and innovation programmes |  |  |  |  |  |  |
| §EIC HLG of Innovators |  |  |  |  |  |  |
| §Report on mission-oriented approach |  |  |  |  |  |  |
| 3.3 On-line consultation |  |  |  |  |  |  |
| §Cluster-based public stakeholder consultation |  |  |  |  |  |  |
| §Call for feedback on missions |  |  |  |  |  |  |
| 3.4. Workshops, meetings and seminars |  |  |  |  |  |  |
| §Simplification workshop |  |  |  |  |  |  |

3.1Conferences and events

The aim of conferences and events was to gather input from a larger number of stakeholders through direct interaction.

A conference "Research & Innovation – Shaping our Future"
[3](#footnote4)
 organised on 3 July 2017 brought together policymakers from EU institutions, stakeholders and interested actors to discuss the role of research and innovation for Europe's future. Pascal Lamy, the chair of the High Level Group on maximising the impact of European research and innovation programmes, presented the Group's vision and recommendations for the future, based on the results of the interim evaluation of Horizon 2020. Other visionary speakers included captains of industry, researchers and innovators at the frontier of progress, politicians and movers and shakers in society but also young people. More than 600 stakeholders from 40 different countries and almost 5000 online viewers from 49 countries actively engaged in the discussion on the future of EU R&I programme by asking 229 questions and submitting 7,788 votes to polls through special IT tool Sli.do. The Commission also followed the discussions at various events organised by different entities.

A conference "European Research Excellence: Impact and value for society"
[4](#footnote5)
 organised by Estonian Presidency aimed to influence the debate on European research policy in the lead-up to the next Framework Programme. The outcome of the EU Presidency Conference was presented in a final declaration, the Tallinn Call for Action. The Conference brought together internationally-outstanding scientists and policymakers from many EU countries, as well as a range of stakeholders from academia, business, and civil society.

3.2Expert groups

In September 2016 the European Commission mandated the High Level Group on maximising the impact of European research and innovation programmes to provide advice on how to maximise the impact of the EU's investment in research and innovation based on the results of the interim evaluation of Horizon 2020. The High Level Group concluded with 11 recommendations for the future EU R&I programme presented in the report "
[LAB – FAB – APP: Investing in the European future we want](https://ec.europa.eu/research/evaluations/pdf/archive/other_reports_studies_and_documents/hlg_2017_report.pdf)
"
[5](#footnote6)
 in July 2017.

European Innovation Council High Level Group of Innovators was set up in January 2017 and mandated to support the European Commission in developing the European Innovation Council (EIC). The report 
["Europe is back: Accelerating breakthrough innovation](https://ec.europa.eu/info/sites/info/files/eic_hlg_bz_web.pdf)
"
[6](#footnote7)
 with 14 recommendations was adopted in January 2018.

Following the recommendations of the Lamy report on missions, an external expert was appointed to advise the Commission on the mission-oriented approach. In February 2018, Prof Mariana Mazzucato presented a report "
[Mission-Oriented Research & Innovation in the European Union - A problem-solving approach to fuel innovation-led growth](https://ec.europa.eu/info/files/mission-oriented-research-and-innovation-european-union-m-mazzucato_en)
"
[7](#footnote8)
 in which she recommends five key criteria for the selection of missions at EU level.  

3.3On-line consultations

The aim of web-based consultations was to gather inputs from a broad range of stakeholders. It included on one hand consultation with unlimited access to everybody who wished to contribute – cluster-based public consultation and on the other hand targeted consultation – call for feedback on missions.

ØCluster-based public consultation

Target group:
   citizens and stakeholders

Timing: January - March (8 weeks) 2018

The public consultation – launched through the Commission’s central public consultation website
[8](#footnote9)
 - on EU funds in the area of investment, research & innovation, SMEs and single market was launched as a mandatory element of the stakeholder consultation. It included both closed and open questions and queried on the policy challenges, subsidiarity and added value, objectives of the programmes and obstacles to reach them, scope for simplification and synergy between the programmes. Stakeholder had also a chance to submit their position papers on the design of the post 2020 EU programmes. The consultation period was shortened to 8 weeks, as compared to the standard 12 weeks, given the tight timing of the new programmes preparations.

ØCall for feedback on missions

Target group:
   citizens and stakeholders

Timing:
   February – April 2018

In the report prepared by Prof Mazzucato on mission-oriented R&I
[9](#footnote10)
, five criteria for setting up the missions were suggested. A call for feedback on these recommended criteria was launched
[10](#footnote11)
. Besides stakeholders' views on the criteria for mission, as a new feature of the Framework Programme, the respondents were also asked for suggestions of concrete missions. However, information on the topics for concrete missions will be used in the future, not for the purpose of this consultation.

  

3.4Workshops, meetings and seminars

Stakeholder workshop on ideas for further simplification of the implementation of the R&I Framework Programmes was organised by the Commission on 20 October 2017
[11](#footnote12)
. The main objective of the workshop was to have a discussion with practitioners at working level on the technical details of the processes, documentation and guidance for R&I grant implementation. Representatives of the main European research stakeholder umbrella organisations were invited to participate on site and the meeting was also web-streamed to allow for broader remote contribution. The programme of the workshop was built upon the conclusions of the Conference on Performance and Further Simplification hosted by Commissioner Moedas in February 2017, and the recommendations of the Lamy Report.

3.5Position papers

Various stakeholders expressed their views on the post 2020 EU programme for R&I by submitting their position papers. More than 300 position papers have been submitted, either ad-hoc or as a response to the cluster-based public stakeholder consultation.

The EU institutions also expressed their views on the post 2020 EU programme for R&I adopting the reports based on the results of the interim evaluation of Horizon 2020:

·Competitiveness Council Conclusions From the Interim Evaluation of Horizon 2020 towards the ninth Framework Programme adopted on 1 December 2017
[12](#footnote13)
;

·ERAC Opinion
[13](#footnote14)
 of 7 July 2017 on the Interim Evaluation of Horizon 2020 and preparations for the next Framework Programme (FP);

·European Parliament (EP) resolution of 13 June 2017 on the assessment of Horizon 2020 implementation in view of its interim evaluation and the Framework Programme 9 proposal
[14](#footnote15)
;

·Opinion of the European Economic and Social Committee of 20 October 2016 on the mid-term evaluation of Horizon 2020
[15](#footnote16)
 and an information report of 16  January 2017 on Horizon 2020 (evaluation)
[16](#footnote17)
;

·Opinion of the Committee of Regions on local and regional dimension of the Horizon 2020 Programme and the new Framework Programme for Research and Innovation of 12 July 2017
[17](#footnote18)
.

4Methodology and tools used to process the data

Information collected during the consultation was analysed depending on the consultation method. Reports from the conferences, workshops and expert groups were prepared and published. All relevant stakeholder input, including the results of the on-line consultations as well as the position papers, were carefully analysed against the key issues identified in the process of the impact assessment preparations.  

5Results of the stakeholder consultation 

5.1Conferences and events

The conference "Research & Innovation – Shaping our Future" (3 July 2017) opened the discussion with stakeholders on the future of R&I. At this early stage in the process, stakeholders expressed first views regarding the missions underlying that transparency in setting up the missions is of utmost importance and highlighting the role of society and citizens.

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08003.jpg)

Stakeholders were also asked to summarise their vision for the future R&I programme and the responses focused on such key concepts like jobs, SMEs and impact.

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08004.jpg)

At the conference organised by the Estonian Presidency on 12 October 2017, "European Research Excellence: Impact and value for society", the key message on the importance of R&I for the future was translated into three priorities: 1) Ensure investment in research and innovation; 2) Increase the impact of R&I investments; 3) Build trust between research and society, and within the R&I system. It was followed by a number of more concrete actions addressed to different groups from policymakers to researchers to increase public and political support for R&I.

5.2Expert groups

In the preparation of the next Programme, the Commission sought information and assistance from different expert groups. The High Level Group on maximising the impact of European research and innovation programmes prepared 11 recommendations which triggered the discussion on the R&I future. Stakeholders reflected upon many of them in their position papers:

·Prioritise research and innovation in EU and national budgets

·Build a true EU innovation policy that creates future markets

·Educate for the future and invest in people who will make the change

·Design the EU R&I programme for greater impact

·Adopt a mission-oriented, impact-focused approach to address global challenges

·Rationalise the EU funding landscape and achieve synergy with structural funds

·Simplify further

·Mobilise and involve citizens

·Better align EU and national R&I investment

·Make international R&I cooperation a trademark of EU research and innovation

·Capture and better communicate impact

In order to collect information on a way forward regarding the breakthrough innovation the  European Innovation Council High Level Group of Innovators was set up and developed 14 recommendations to support single innovators turning disruptive/breakthrough science and technology into market-creating innovations grouped into four factors that hold back breakthrough and deep tech innovation in Europe:

-Funding: empower the innovator, simplify, incentivise private investment,

-Awareness: champion innovators, communicate success,

-Scale: build the camp, leverage European ecosystems,

-Talent: connect people, create prestige for innovators.

A new concept of missions suggested in the Lamy report was further elaborated in the report "
[Mission-Oriented Research & Innovation in the European Union - A problem-solving approach to fuel innovation-led growth](https://ec.europa.eu/info/files/mission-oriented-research-and-innovation-european-union-m-mazzucato_en)
" prepared by an expert in the area, prof. Mariana Mazzucato. Five criteria for the selection of the missions were identified:

·EU R&I missions should be bold, inspirational with wide societal relevance;

·EU R&I missions should have a clear direction: should be targeted, measureable and time-bound;

·EU R&I missions should have ambitious but realistic research & innovation actions

·EU R&I missions should be cross-disciplinary, cross-sectoral and cross-actor

·EU R&I missions should foster multiple, bottom-up solutions

The stakeholders were asked to rate the importance of these criteria in a special Call for feedback open until 3 April in which 1200 responses submitted. The overall picture is that respondents agreed to the criteria and measures for implementing mission proposed by Prof Mazzucato, and agreed to consult citizens on the choice of missions.

5.3Workshops, meetings and seminars

Key messages from dialogue with stakeholders on simplification coming from the workshop on that issue of key importance for participants, especially new ones, were as follows:

·Support to the existing funding model, with a single funding rate per project and a flat rate for the indirect costs;

·Cautious regarding a broad extension of the simplified cost options, such as the Lump Sum pilot in Horizon 2020, or the use of unit costs for personnel costs; clear preference for continuation of cost reimbursement;

·Request for broader acceptance of usual cost-accounting practices and for the introduction of the single audit principle/cross-reliance on audits;

·Further shortening of the Time to Grant, simplified project reporting and improvements to the submission and evaluation processes;

·Improve projects reporting in order to increase the quality of dissemination and exploitation.

5.4Online consultation, including the public consultation on EU funds in the area of investment, research & innovation, SMEs and single market

More than 4000 responses were submitted to the cluster-based public consultation on EU funds in the area of investment, research & innovation, SMEs and single market. 94% of respondents referred to the EU support for R&I. These respondents are subject of the further analysis below.

Almost half of respondents (46%) replied to the consultation in individual capacity followed by business and industry representatives (17%) and universities (14%). 93% of respondents were from EU Member States, 5% from associated countries and 1% from third countries. Respondents came from 70 different countries.

Figure 2 Respondents to cluster-based public consultation

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08005.jpg)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08006.jpg)

Some 90% (3,414) of cluster survey respondents reported having experience with the Horizon 2020 program. Those respondents who reported having experience with Horizon 2020 also reported having experience with European Structural and Investment funds (22%), EU Health Programme (9%) and COSME (8.%).

The Commission has preliminarily identified a number of policy challenges that the programmes/funds in the area of investment, research & innovation, SMEs and single market could address. The three most important policy challenges in view of respondents are:

·“Fostering R&I across the EU”: 97% of respondents consider this very or rather important policy challenge. The absolute majority of those who submitted position papers also implicitly acknowledge R&I as an important policy priority for Europe. Stakeholders consider that R&I play a fundamental role in forming European identity.

·“Supporting education, skills and training”: 93% of respondents consider this very or rather important policy challenge.

·“Ensuring a clean and healthy environment and the protection of natural resources”: 90% of respondents consider this a very or rather important policy challenge.

Some 61% of respondents believe that “fostering R&I across the EU” has so far been fully or fairly well addressed policy challenge while 35% consider it has been addressed to some extent only. Among other challenges, stakeholders consider that provision of smooth circulation of goods and support to capital flows and investments are well addressed. However, stakeholder responses suggest that more can be done to address unemployment and social disparities: only 14% of respondents consider that this challenge is fairly well addressed, while 40% are of the opinion that it has been addressed to some extent only and 21% believe that it has not been addressed at all.

According to vast majority of stakeholders, "too complex procedures leading to high administrative burden and delays" is the main obstacle preventing the current programme from achieving its objectives. Regional public authorities in particular agree with this statement. The other obstacles noted were: "lack of flexibility to react to unforeseen circumstances", "insufficient synergies between the EU programmes/funds" and "difficulty of combining EU action with other public interventions and private finance".

Generally, stakeholders agree that fewer, clearer, shorter rules, alignment of rules between EU funds and better feedback to applicants are the most important simplification factors.

The majority of respondents (88%) believe that the current programme adds value, to a large or fairly good extent, compared to what Member States could achieve at national, regional and/or local level. Public regional authorities, universities and civil society organisations appear to be slightly more positive in this regard.

Collaboration and cooperation is the most often given example of the EU added value of EU programmes and funds over efforts of Member States. Research organisations, national public authorities and individuals more frequently referenced collaboration and cooperation compared to other stakeholders. Business and industry, other stakeholders and individuals on the other hand more frequently discussed maximising competition. Meanwhile, international organisations, universities and regional public authorities more frequently than other stakeholders noted that increased mobility is an added value of EU programmes and funds. Stakeholders consider also new markets, various networks and partnerships, pooling of resources and increased visibility as factors that provide considerable added value to EU programmes and funds.

5.5Position papers
[18](#footnote19)

Stakeholders expressed their views also in more than 300 position papers submitted either ad-hoc or to the cluster-based public consultation. All the EU institutions reflected upon the next Framework Programme as well, often in the context of the interim evaluation of Horizon 2020. Most common views from stakeholders are as follows:

§Three-pillar structure should be kept, though better links between pillars are needed

The vast majority of stakeholders are satisfied with the current three-pillar structure of the Framework Programme and wish to see either a complete replication or small modifications to the existing architecture. The main criticisms relate to the lack of coherence and links between the pillars that hamper coverage of the whole knowledge chain. Some say that the societal challenges pillar should become more prominent and more relevant, taking into account the current pressing socio-economic issues. The suggestion was also made to rename the "Industrial Leadership" pillar to "Innovation Leadership", giving it a more cross-cutting outlook.

§Successful individual researchers' schemes (ERC, MSCA) need increased budget

The European Research Council (ERC) and Marie Skłodowska-Curie Actions (MSCA) are widely appreciated and many voices stress that these two schemes should be strengthened with a budget increase.

§The Future and Emerging Technology (FET) actions should be strengthened

The majority of stakeholders praise the FET schemes as an important set of instruments that should be strengthened in the future. The bottom-up principle of FET is recognised as a strong point. Suggestions are made to ensure better links with other R&I instruments such as the EIC and EIT. The main concerns are related to the serious oversubscription, particularly to FET Open scheme, hence a more strategic approach is needed when defining the FET priority areas and budgetary allocation for individual calls.

§Key Enabling Technologies (KETs)

Those stakeholders commenting noted that KETs play a vital role in Europe’s industrial competitiveness and ability to tackle societal challenges and should hence continue to play a central role in the forthcoming Horizon Europe. Some stakeholders and Member States call for a separate programme part oriented on KETs.

§Grants to remain the main funding model, complemented by dedicated financial instruments

An overwhelming majority of stakeholders stress that grants should remain the main funding mode under the next Framework Programme, as the only acceptable funding instrument for public and non-profit entities as well as certain economically non-viable R&D areas (in the short-term) despite the huge socioeconomic impact they may have (in the long term). It is also widely shared that any loan-based funding should not be introduced to the detriment of grant-based funding. At the same time, some stakeholders say that financial instruments could be introduced as a very useful complementary funding. This is especially the case for close-to-market activities in areas where the possible scalability of innovations does not correlate to the very high expectations of the venture capital funding or where periods between research and market success are very long.

Industry representatives, though, caution that proposals to give more flexibility to applicants to choose from a portfolio of instruments provided and to have innovative blending of grant, loan and equity- based forms of investment require careful consideration. For close-to-market activities (above TRL8), blended instruments with additional loan funding can be useful, but attention should be paid to maintaining clear and simple processes as well as avoiding higher bureaucracy both for public and private sectors.

§Stronger emphasis for curiosity-driven research is needed

A significant share of stakeholders call for a stronger focus on bottom-up curiosity-driven calls to adapt better to the emerging societal needs. The need for more bottom-up approach was particularly referred in relation to the EIC and mission-orientation. One third of respondents flag the need to ensure an adequate balance between top-down themes for societal challenges and a bottom-up supply of ideas to address them.

  

§Use synergies with the Structural Funds to incentivise the widening of FP participation

Almost half of stakeholders, mainly Member States, universities and research organisations, commented on the “Spreading excellence and widening participation” part of Horizon 2020. Many Member States, from different parts of the European Union and with different experience and performance in the Framework Programme, call for increased support to and/or dedicated instruments to address the “spreading excellence” objective (Croatia, Czech Republic, Cyprus, Estonia, France, Germany, Hungary, Italy, Lithuania, Poland, Portugal, Slovakia, Slovenia and Sweden). ‘Widening participation’ objective as an important aspect for the design of Horizon Europe is highlighted also by Belgium, Ireland and Spain, yet they place more noticeable emphasis on the need to incentivise Member States' own investments and efforts in capacity building or national/regional research and innovation ecosystems. At the same time two Member States express strong support to excellence as priority over any geographical considerations (Denmark and Finland).

The most debated aspect is the proposition to introduce geographical quotas for participation in Horizon Europe. A dominating view is though that this would not bring the required effects, but only distort the excellence-based principle of the Framework Programme. Among the most frequently cited means to spread excellence are synergies with the ESI funds through a ring-fenced budget dedicated to the “widening” objective, continued support to existing mechanisms (Teaming, Twinning, ERA-Chairs, COST, NCP networks), a return phase for intra-European MSCA fellowships, EIT KIC Regional Innovation scheme and targeted measures to promote pockets of excellence in low R&I performing countries. At the same time there are also voices on the need to incentivise Member States' investments and efforts in capacity building of national/regional research and innovation ecosystems. The Commission’s initiative to launch Policy Support Facility (PSF) has been commended as a good step in this direction.

§Smaller scale collaborative projects are important for widening, originality and creativity

An overwhelming majority of stakeholders commenting on the size of projects support a justified balance between big and small-scale projects. The budget threshold stakeholders consider as an indicator for a small collaborative project ranges from less than EUR 3 million to less than EUR 8 million. It was reasoned that small and medium-sized collaborative projects offer good prospects for the participation of junior researchers and newcomers (such as start-ups and young companies) particularly from Member States which have, up to now, been involved to a lesser extent. Smaller projects may also be much better starting point for exploring promising lines of enquiry, engaging in riskier research and thus incentivising originality and creativity.

§Define R&I missions as ambitious but feasible high-impact objectives

Around half of the submitted position papers included references to mission-orientation of Horizon Europe. Almost all stakeholders either clearly support mission-orientation or indirectly acknowledge this as a possible future scenario. Only a few concerns were noted mainly that the focus on the selected missions might be done at the expense of curiosity-driven fundamental research.

In general, stakeholders consider that tangible missions that underpin the overall political objectives could enhance visibility and create a more strongly engaging narrative of the Framework Programme. One proposition is to define missions “as ambitious but feasible, high-impact objectives, embedded within a challenge-based approach”. Missions should be limited in number, easy to communicate and have a concrete budget and timeline. They should have a breakthrough or transformative potential and a clear EU added value. Cross-sectoral and cross-disciplinary collaboration should be at the core of mission approach.

In terms of programming and implementation modalities, stakeholders consider that R&I missions should be formulated in an open manner and underpinned by non-prescriptive calls. There is widespread acknowledgement on the need to engage wider society in identifying the most relevant missions within broader societal challenges. Coordination mechanisms should be put in place to support any synergies between the projects contributing to the same mission.

All EU Institutions stress the importance of getting citizens more involved and maximising impact from the Framework Programme. The Committee of the Regions is very explicit in encouraging the adoption of a new, complementary approach based on missions. ERAC and the Council point to the need to deliver better and continued outreach to society, and call for exploring a mission-oriented approach.

§Citizens should be better involved through tailored co-design and co-creation mechanisms

More than a third of stakeholders touch upon the idea of opening up the agenda-setting, design and evaluation of European research and innovation to society and citizens. Stakeholders are supportive of the idea that the Framework Programme should address citizens' concerns better and involve them in a more substantial role with sufficient attention paid to "Societal Readiness Levels" (SRLs) aimed at increasing societal impact. In several cases, stakeholders highlighted also crowdfunding as a possible additional part in the COFUND scheme.

Stakeholders underline also the need to enhance science communication, as well as promote R&I projects to develop more ambitious communication strategies, including all types of media. They place particular attention on making sure that the impacts of designated R&I missions are clearly communicated and disseminated to society at large.

§Reinforce Social Sciences and Humanities (SSH) to make mission-orientation a success 

Many stakeholders reflected upon SSH underlining its value in particularly with relation to societal challenges and the suggested mission-orientated approach. Generally, stakeholders call for more adequately reflecting the SSH dimension in the design of call and consortium requirements, proposal evaluations and impact measurement.

§EIC should simplify the current support to innovation and act as an European Accelerator

Around 80% of stakeholders who reflected upon the future European Innovation Council (EIC) favour the overall idea and provide detailed suggestions on the possible role, objectives and arrangements for its operation. A recurring view is that the EIC should not add an extra layer of governance, but rather seek to identify gaps, coordinate and simplify the existing support instruments serving as an umbrella initiative with a concretely defined value added. The idea of bringing together existing instruments (SME instrument, Fast Track to Innovation, FET Open and inducement prizes) for a comprehensive support to all forms of innovation and technologies, including market-creating innovation is well echoed across the stakeholder input.

Stakeholders consider that support to innovative SMEs and start-ups is essential to maximise Europe’s potential for growth and socioeconomic transformation. Thus the role of EIC in support to SMEs is frequently emphasised. Some stakeholders and Member States are of the opinion that the introduction of the EIC should make the support landscape for SMEs much clearer and easier to navigate.

There is a split opinion from stakeholders on the success of the current SME Instrument scheme. While some consider the programme a great achievement of Horizon 2020, others are much more critical pointing out the high rates of oversubscription and casting doubt on the EU added value of funding single companies.

The main concerns expressed in relation to the EIC idea are that support to incremental innovation should not diminish due to an increased emphasis on breakthrough innovation that the EIC will aim to promote. There are also voices against the creation of a separate organisation suggesting evaluating more carefully the possible merging of the EIC mandate with the EIT, FET or ERC to capture the whole research-innovation spectrum.

The European Parliament stresses the importance of innovation support in general, and of disruptive innovation and scaling up in particular. The Council emphasises the importance of supporting the whole innovation value chain, including high-risk disruptive technologies, while the possible future EIC should support breakthrough innovations and the scaling up of innovative companies.

§Boost international cooperation to tackle global challenges

Many stakeholders reflected on the international cooperation including around 70% of all Member States who submitted position papers. A predominant view among stakeholders is that cooperation with third countries should be strengthened to counter the drop in internationalisation activities and participation rates from third countries that was experienced moving from FP7 to Horizon 2020. Some stakeholders advocate that science is a strong force in international diplomacy; hence, the EU should seek to strengthen collaboration in science and technology further beyond Europe. Several contributions also highlighted that the Commission should consider making it easier for participants from third countries to join ongoing projects on an ad-hoc basis, especially if they do not qualify to receive EU funding. One suggestion is to allow secondary recipients of funds, who are not part of the EU, to negotiate the terms of their cooperation directly with their European partners in order to establish a mutually beneficial arrangement. As a principle, reciprocity between third country programmes should be sought, where relevant.

A few stakeholders touched upon the issue of exploitation of research and innovation results in Europe first. There were suggestions that the EU could adopt legislation to encourage stakeholders conducting research mainly financed by European public funds, to exploit the results of this research primarily on European soil.

The European Parliament calls for strengthening international R&I cooperation, including with associate partners and emerging countries, as soon as possible through concrete actions. The Parliament, in addition, highlights the value of science diplomacy. The Council reaffirms the importance of reciprocity.

§Open science entails a complex cultural change that should be supported

Among stakeholders who reflected on these issues, Member States, universities and research organisations appear to be more vocal. It is widely acknowledged that data and knowledge produced from EU funded projects should be openly shared. Stakeholders frequently cite the need to adhere to FAIR data principles. Business representatives underline more that the opt-out option for Open Data Pilot should be maintained to secure some confidentiality of market-oriented innovation outputs. Stakeholder contributions highlight that open science, open data and open access paradigm calls for establishing new principles in citation and academic reward system, as well as require more attention to development of skills in research data management. Some stakeholders also mention European Open Science Cloud (EOSC) agenda, in most cases expressing support to this EU level initiative. Incentives for Open Science were also mentioned.

The European Parliament opinion is in favour of the general principle of Open Access, while ERAC regards the 100% Open Access policy of Horizon 2020 as a clear measure in favour of knowledge circulation. Importantly, the Council Conclusions on the transition towards an Open Science System give valuable guidance for the future, while the Council Conclusions on the Interim Evaluation of Horizon 2020 highlight the role of Open Science in boosting impact and transparency.

§Make the R&I support landscape simpler

Concerns that the EU R&I funding instrument landscape is too complex are widely echoed in the majority of position papers across all stakeholder groups. Stakeholders advocate for aligning intervention logics of the proposed instruments with already well-embedded schemes to detect gaps, overlaps and work towards better synergies. Some stakeholders explicitly emphasise that existing support schemes should be carefully evaluated and discontinuation of funding should be an option for measures that do not hold self-sustainability test (sunset clause).

The EIT receives positive remarks as an attempt to integrate all sides of the knowledge triangle and create cross-border innovation networks as ‘true pan-European actors’. Yet stakeholders recognise that EIT KICs are part of the proliferation of R&I instruments and call for formulating their clear added value and complementarity with other instruments. A frequent plea for better synergies and coordination between EIT and EIC is expressed. There is also a call for improving the EIT and the KICs' openness to the inclusion of new relevant actors. Stakeholders also note the unnecessary detailed rules and control requirements applied by the EIT for existing KICs, and call for better adapting them to the nature of Horizon Europe.

ERAC considers it particularly urgent to rationalise the funding schemes, while considering public-to-public partnerships essential for more coordinated implementation of national and EU R&I. The Council similarly stresses that the current R&I ecosystem has become too complex and that all partnership initiatives should have an exit strategy from EU funding. The European Parliament advocates ‘decomplexifying’ the EU funding landscape.

§Synergies with other EU programmes are difficult to achieve, but are essential

An overwhelming majority of stakeholders specifically mention synergies with the ESI funds as an area deserving most of attention. Also, cluster survey responses confirm synergies with the ESI funds as the most frequently-discussed area for future complementarities. There is widespread recognition, however, that achieving real complementarities between the Framework Programme and the ESI funds is difficult in practice due to different nature and implementation modalities of both funding instruments. In the views of some stakeholders, the Seal of Excellence has not lived up to expectations as an attempt to bridge both programmes. Several stakeholders draw attention to the need for ensuring that research infrastructures are able to effectively utilise the ESI funds to support their construction and operation. Alignment and modifications in State Aid rules to ensure more innovation-friendly regulatory environment is an equally prevailing concern of stakeholders.

The need to strengthen synergies and links with other EU programmes and instruments is much less pronounced, though universities as well as some Member States refer specifically to synergies with higher education area. Stakeholders acknowledge the necessity to strengthen the connections of all three sides of the knowledge triangle and design complementarities between programme intervention logics. Research organisations and industry stakeholders also recognise the untapped potential of closer knowledge triangle integration. An idea of creation excellence-based university network is proposed Critique of the idea of ‘European Universities’ label is expressed by both university and industry networks.

§Enhance the strategic programming process

Many stakeholders, and the majority of Member States, reflected on the strategic programming process. Several stakeholders flag that the transparency in the process of formulating work programmes and traceability of stakeholder inputs should be improved and the comitology process enhanced. Programme Committees should be fully involved in strategic discussions before orientation papers are presented by the Commission. There should be enough time for negotiations before decisions are taken. The process for drafting work programmes must be predictable, uniform and transparent, allowing time for development of views and the identification of synergies between the Programme Committees. An overall need to better align the interfaces between the EU, Member States and societal stakeholders (joint standing committees) is flagged by another range of contributors. The introduction of more flexible biennial work programmes is explicitly welcomed by some respondents. There is also a more radical call to implement open calls with several cut-off dates per year instead of having calls for proposals with deadlines.

Some stakeholders were also in favour of enhancing the management capacity of Commission Directorates-General. Here, the need for better coordination among it was suggested to better coordinate the work of the various Commission Directorates-General and the executive agencies to ensure more strategic management approach and streamlined interpretation of rules. Other stakeholders underline the need to resource and enhance the management capacities of the Commission, in alignment with the level of ambition for the future programme.

§Continue the drive for simplification

Simplification efforts already implemented by the Commission have been well recognised. The large share of stakeholders, however, call for further simplification actions. This was also a main finding of the simplification workshop organised with European stakeholder umbrella organisations.

The two-stage submission procedure is regarded as beneficial. It is a widely-held view that a more selective first stage evaluating excellence and impact must be completed first, while the implementation and consortium competence can be judged at the second stage. Some stakeholders suggest also concrete targets for this procedure such as reaching a 1 in 3 success rate at the second stage. At the same time, stakeholders consider that a more detailed feedback to all the unsuccessful applicants also should be ensured. There is also a call for further optimisation of the Participant Portal.

It is generally acknowledged that the current cost reimbursement formula (100% for direct costs + 25% for indirect costs) works well and has helped to simplify the current programme, even though it is suggested to consider an increase of indirect costs in case of non-profit organisations.

Views on the introduction of lump sum-based funding are split. Around one third of stakeholders that reflected on this topic welcome this initiative, stating that it has considerable simplification potential, especially for SMEs and small projects with small-size participants. More than a half of stakeholders, however, are more cautious and call for a careful assessment of the lump-sum pilots beforehand. Stakeholders call for a thorough attention to the lump-sum calculation methodology to ensure that it does not shift workload from administration and financial support teams to researchers and does not create a competition on pricing and distort the ‘level playing field’.

Another area of concern relates to the need for a better model for reporting personnel costs, as expressed by some Member States and organisations highlighting the need for an appropriate system of personnel remuneration so that the rules are not disadvantageous for participants coming from some countries. Other topics cited included the introduction of the Single Rulebook, simplification of the Annotated Model Grant Agreement and further improvements to the Participant Portal.

Generally, there is a consensus that the evaluation system of the Framework Programme should be robust, fair, clear, transparent, and as fast as possible. Among the key improvements of the evaluation process, stakeholders mention the need to increase the quality of the feedback information provided to the applicants; the composition of and complementarities between skills, experiences and perspectives (e.g. sector, including industry; discipline, especially SSH; gender; nationality; end-users in case of close to market calls, etc.) of evaluation panel members; and re-introduction of consensus meetings.

§Adapt the definition of innovation and improve evaluation to capture impacts of FP funding

A large majority of stakeholders highlighted aspects related to the need for better defining and measuring impact, especially with regards to the mission-oriented approach. The significance of tracing impact is widely recognised, especially by Member States and universities. Stakeholders acknowledge the need to adopt a broader view on impact covering not only economic, but also social, scientific and cultural impacts. The impact definition should describe the desired outcomes of research and innovation while TRLs stipulate the route to get there. It is also underlined that impact should be viewed in a much longer term than the current impact assessment practices generally capture. This implies that Framework Programme project coordinators should be obliged to provide interviews also long after the project has ended. A call to develop better methodological frameworks to allow for tracking economic and social impact has been raised. But some stakeholders, especially business and industry, warn that impact measurement should not become too complex and overly bureaucratic.

Some stakeholders commented on the reporting and monitoring obligations, stating that imposed reporting obligations should be feasible for beneficiaries and relevant to measure the progress of projects towards the defined overarching goals. They flag the need to establish comprehensive monitoring systems to measure the extent to which supported actions contribute to societal challenges and other programme objectives. Other stakeholders emphasise that monitoring is essential to ensure reflection, improve learning curves and revisit the structure of Horizon Europe instruments to adapt to emerging trends.

6Inclusion of the stakeholder consultation results in the legal proposal 

Stakeholder views have been analysed and taken into account, to the extent possible, regarding the structure and key principles, implementation and governance of Horizon Europe.

Following the overall endorsement by stakeholders, the three-pillar structure is maintained and refined to enhance linkages between pillars for a greater impact. Key Enabling Technologies, due to their effectiveness in tackling societal challenges, will continue under Global Challenges pillar. The design of all new elements, but in particular missions and the European Innovation Council, fully reflect stakeholder views. Citizens will be involved in selecting the most relevant missions, while the EIC aims at simplifying existing support instruments. Although the EIC will focus on breakthrough innovation, Horizon Europe will continue to support incremental innovation through the Global Challenges and the EIT.

Synergies between different funding programmes will be facilitated by, for example, making the Seal of Excellence more operational and addressing issues of State Aid. The complexity of the research and innovation system is fully addressed by the new approach to Partnerships, which will lead to a smaller number of more coherent initiatives having higher impact and leverage. Moreover, the current Horizon 2020 support to lower-performing EU countries will be continued and strengthen.

As regards implementation issues, the current funding rates will be maintained and lump sums will be scaled up, though taking into account lessons learnt from the ongoing pilot phase. Provisions on association to the Horizon Europe, and eligibility criteria for funding are both designed to increase international cooperation. Finally, the strategic programming for calls will become more transparent and open, to ensure a more active involvement of EU institutions, citizens and end-users.

Annex 3: Evaluation results

1Lessons from the evaluations of previous Framework Programmes

While European research and innovation programmes have been successful, there are important lessons to be learned from the past, from stakeholder feedback, and from analytical studies. Research, innovation and education should be addressed in a more coordinated manner and coherent with other policies and research results better disseminated and valorised into new products, processes and services. The intervention logic of EU support programmes should be developed in a more focused, concrete, detailed, inclusive and transparent manner. Programme access should be improved and start-up, SME, industrial, EU13 and extra-EU participation increased. Monitoring and evaluation need to be strengthened.

1.1Improved horizontal and vertical policy coordination

A number of ex-post evaluations of the Framework Programme have noted that the coordination between, on the one hand, the Framework Programme and other EU policies, and on the other hand, the Framework Programme and Member State research activities could be improved. With regard to horizontal policy coordination in the narrow sense, the FP7 interim evaluation
[19](#footnote20)
 noted that a strategic shift is needed to establish stronger and better connections between research, innovation and education (the so-called 'knowledge triangle'). As for broader horizontal policy coordination, the FP6 ex-post evaluation
[20](#footnote21)
 called for a clearer division of labour between the FP and the cohesion policy funds. It also stated that other EU policies such as transportation and energy would benefit from a more coordinated interface between research activities under the Framework Programme and regulatory and demand-side policies.

The need for horizontal policy coordination is confirmed by the conclusions of the OECD's work on the most appropriate system of innovation governance. OECD
[21](#footnote22)
, for instance, mentions the need to develop "a strategic, horizontal approach", which "should include and develop the innovation policy potential in other ministerial domains and ensure a co-ordinated division of labour between them". And OECD
[22](#footnote23)
 concludes that "given the increasingly central role of innovation in delivering a wide range of economic and social objectives, a whole-of-government approach to policies for innovation is needed". With regard to vertical policy coordination, the FP6 ex-post evaluation noted that, given its small size compared to Member State expenditure, the Framework Programme should not try to substitute for Member State R&D policies but should use its added value in a more strategic way and set an attractive and accepted European agenda. In the same vein, an evaluation
[23](#footnote24)
 concluded that the division of labour between the EU and national levels should be further refined, in particular in view of the introduction of the likes of the European Research Council and the Joint Technology Initiatives. The need for vertical policy coordination is confirmed by the results of OECD work on the optimal system of innovation governance. OECD
[24](#footnote25)
, for instance, calls for "coherence and complementarities between the local, regional, national and international levels".

1.2Focus and a more robust intervention logic

A number of ex-post evaluations
[25](#footnote26)
of the Framework Programme have noted that the programme's design could be improved. Some pointed that the Framework Programme lacks a clear and robust intervention logic: the programme has too many objectives, and higher-level objectives are insufficiently translated into lower-level objectives.

With regard to the Framework Programme's objectives, the FP6 ex-post evaluation
[26](#footnote27)
 as well as expert evidence
[27](#footnote28)
 noted that there were too many – addressing almost all S&T and socioeconomic challenges - and that they were too abstract and vague and therefore untestable, complicating ex-post evaluation. A European Parliament ITRE Committee report
[28](#footnote29)
 noted in the same vein that "an ever-growing number of objectives and themes covered and diversification of instruments has widened the scope of FP7 and reduced its capacity to serve a specific European objective". In addition, no explicit links are made between higher-level objectives and lower-level concrete technical goals
[29](#footnote30)
. Meanwhile, instruments are not designed explicitly to achieve particular objectives: challenges are defined so as to match existing instruments, not the other way around
[30](#footnote31)
. The result is 'catch all' instruments trying to tackle all problems and to satisfy all types of stakeholders. That is why the European Court of Auditors has called for addressing a single objective through each instrument
[31](#footnote32)
.

The importance of focus and a proper hierarchy of objectives (combined with appropriate monitoring) are confirmed by OECD work. OECD
[32](#footnote33)
 for instance, argues in favour of "a more strategic focus on the role of policies for innovation in delivering stronger, cleaner and fairer growth". The OECD
[33](#footnote34)
 notes that "third-generation innovation policy cannot be properly implemented without precise targets and intelligent follow-up. Governments should increase their capacity to develop actions plans based on horizontal, strategic approaches and translate these into concrete measures to be taken by each ministry or agency.

1.3Lower barriers to participation and increase dissemination and valorisation of outputs

All ex-post evaluations of the Framework Programme - see, for instance, the chapters on participation in the FP6 ex-post 
[34](#footnote35)
and FP7 interim evaluations
[35](#footnote36)
 - are unanimous in their view that application, contract negotiation and project management procedures are too complex and burdensome and that this results in high barriers to application and participation to the Framework Programme, in general but in particular for first time, start-up, SMEs and applicants from new Member States.

Participants' main reasons for getting involved in the Framework Programme relate to networking and the creation of new knowledge
[36](#footnote37)
. Research under the Framework Programme is also more of a long-term, exploratory, technologically complex nature
[37](#footnote38)
. The Framework Programme should therefore not be expected to produce new, immediately marketable products and processes.

Nevertheless, Framework Programme’s evaluations conclude that more attention should be paid to the production of project outputs and to their dissemination and economic valorisation, in particular since the Framework Programme is supposed to support Europe's competitiveness. What is highlighted is the absence in the Framework Programme of valorisation channels that enable the exploitation of research results and the linkage of knowledge created through the Framework Programme with socially beneficial uses
[38](#footnote39)
. In the same vein, the FP7 interim evaluation observes a lack of clarity on how the Framework Programme incorporates innovation (as opposed to 'pure' research).

In this respect, OECD
[39](#footnote40)
 argues that "the creation, diffusion and application of knowledge are essential to the ability of firms and countries to innovate and thrive in an increasingly competitive global economy".

1.4Strengthen monitoring and evaluation

The main problem affecting the monitoring and evaluation system of the Framework Programme relates to the aforementioned lack of focused objectives and a robust intervention logic. The evaluation process aims to link evidence emerging from project implementation with the strategic and specific objectives set for the programme. As the European Court of Auditors
[40](#footnote41)
 observed, if this connection is difficult to make, an assessment exercise becomes extremely complicated. The evaluation and monitoring system suffers from other problems as well, however.

The importance of a proper monitoring and evaluation system is emphasized by the OECD
[41](#footnote42)
, for instance, recommends "improving evaluation and learning": "In general, governments should create a solid basis for evaluation and learning and make them part of the policy-making process. This includes evaluation of broader reforms, as knowledge about their impact on innovation is useful for feedback and policy formulation. A more holistic approach to evaluation and learning can enhance feedback in the governance system and lead to more effective policy". The OECD
[42](#footnote43)
 also argues that "evaluation is essential to enhance the effectiveness and efficiency of policies to foster innovation and deliver social welfare. Improved means of evaluation are needed to capture the broadening of innovation, along with better feedback of evaluation into the policy-making process. This also calls for improved measurement of innovation, including its outcomes and impacts".

2Lessons learnt from the Interim Evaluation of Horizon 2020

The Horizon 2020 Interim Evaluation Staff Working Document identified the following strengths and challenges that need to be addressed in the last three years of Horizon 2020, as well as in the next Framework Programme:

2.1Strengths

1.The evidence presented in the Horizon 2020 interim evaluation has demonstrated that, overall, Horizon 2020 is an attractive and well performing programme. It has so far attracted more than 100,000 applications, representing a huge increase in the annual number of applications compared to FP7. It involves top level participants from the higher education, research and private sectors; from a wide range of disciplines and thematic fields; and from over 130 countries. 52% of participants are newcomers. Industrial participation has increased compared to FP7. 23.9% of the budget for industrial and enabling technologies and societal challenges goes to SMEs, far exceeding the target. Stakeholders are generally very satisfied with the programme.

2.Horizon 2020's objectives and rationale for intervention remain highly relevant and have been validated by, and are fully consistent with, recent EU and global priorities, such as the Sustainable Development Goals. The programme has also proven that it is flexible and can respond to emergencies (e.g. Ebola, Zika) and emerging needs.

3.Horizon 2020 is on track to be cost-efficient, achieving a very low administrative overhead, thanks to the extensive externalisation of programme implementation, the creation of a Common Support Centre, and the large-scale simplification of the rules for participation, in particular the funding model, which has reduced time to grant and lowered costs for participants, to the satisfaction of stakeholders and without reducing the level of co-funding by beneficiaries.

4.In terms of effectiveness, through its focus on scientific, economic and societal impacts, Horizon 2020 is on track to contribute to the creation of jobs and growth and the achievement of the priorities of the Juncker Commission. It strengthens the science base by involving the EU's and world's best research institutions and researchers; by training large numbers of EU-based researchers; by producing large numbers of world class open access scientific publications and data; by producing scientific breakthroughs; and by building cross-sectoral, inter-disciplinary, intra- and extra-European research and innovation networks.

5.It fosters industrial leadership by successfully involving the private sector and SMEs; by creating networks between the business sector, universities and research institutions; by providing businesses and SMEs with risk finance to carry out their research and innovation projects; by investing in demand-driven innovation; by producing high quality, commercially valuable patents and other intellectual property rights; by generating proofs of concept and demonstrators and supporting the deployment of innovation solutions; by producing new knowledge, strengthening capabilities, and generating a wide range of innovation outputs including new technologies, products and services; and by increasing the competitiveness of beneficiaries. It addresses major societal challenges by producing publications, patents, prototypes, products, process and methods. It is successful in spreading excellence and widening participation through dedicated instruments and as a cross-cutting issue throughout the programme. It achieves encouraging results in terms of gender equality and the integration of the social sciences and humanities.

6.Compared to FP7, Horizon 2020 is an internally more coherent programme. Synergies with other programmes and instruments are being strengthened.

7.Horizon 2020 has clear European added value in terms of speed, scale and scope and a strong additionality: 83% of funded projects would not have gone ahead without EU funding.

2.2Challenges

1.Horizon 2020 suffers from underfunding, resulting in large-scale oversubscription, much larger than in FP7, which constitutes an enormous waste of resources for applicants and of good proposals for Europe.

2.While Horizon 2020 demonstrates potential in terms of supporting breakthrough, market-creating innovation, such support needs to be strengthened substantially.

3.There is a need for greater outreach to civil society to better explain results and impacts and the contribution that research and innovation can make to tackling societal challenges, and to involve them better in the programme co-design (agenda-setting) and its implementation (co-creation).

4.While great efforts have already been made to increase the synergies between Horizon 2020 and other EU programmes (notably European Structural and Investment Funds), these can be strengthened further, particularly in view of R&I capacity building for lower performing regions.

5.While Horizon 2020 has achieved a broad international outreach, international cooperation needs to be intensified and more efforts are needed to ensure that the programme fully delivers on its target for sustainable development.

6.While compared to FP7, great progress has been made in terms of simplification, simplification is a continuing endeavour, which requires constantly identifying new candidate areas for improvements; at the same time, there is scope for rationalising the Horizon 2020 funding landscape.

7.While Horizon 2020 has made great progress in terms of making openly accessible to the wider scientific community and public the scientific publications and data it generates, more can be done in this respect.

  

Annex 4: Added Value of EU-funded R&I

Without replacing national Research and Innovation (R&I) activities, EU funded R&I activities through the Framework Programmes produce demonstrable benefits compared to national and regional-level support to research and innovation in terms of scale, speed and scope. The added value comes through – inter alia –strengthening the EU’s scientific excellence through competitive funding; the creation of cross-border, multidisciplinary networks; the pooling of resources to achieve critical mass for tackling global challenges, and developing the evidence-base to underpin policymaking. Overall, this increases EU's global attractiveness as a place to carry out research and innovation, strengthens the EU’s competitiveness, contributes to growth and jobs 
[43](#footnote44)
 and makes the EU a world leader in tackling global challenges. Therefore, EU research and innovation should be “one of the essential policy priorities in the future”.
[44](#footnote45)
 

Added value:

·Strengthening the EU’s scientific excellence through competitive funding – Excellence-based EU-wide competition increases the quality and visibility of the research and innovation output beyond what is possible with national or regional level competition. This is shown by the fact that EU-funded peer-reviewed research publications are cited more than twice the world average. Publications from EU funded R&I activities are almost four times more represented in the world’s top 1% of cited research compared with the overall publication output of the 28 EU Member States.
[45](#footnote46)
 Compared to 1.7% of national publications, 7% of ERC publications (973, since its creation in 2007) are among the top 1% highly cited in the world by field, year of publication and type of publication.
[46](#footnote47)

·Creating critical mass to address global challenges- Collaborative projects funded at EU level will help to achieve the “critical mass” required for breakthroughs when research activities are of such a scale and complexity that no single Member State can provide the necessary financial or personnel resources”. This occurs where a large research capacity is needed and resources must be pooled to be effective, or where there is a strong requirement for complementary knowledge and skills (e.g. in highly inter-disciplinary fields). Investing in research and innovation at EU level will address global challenges (eg migration, security, climate change, health) which facilitates finding solutions much faster and efficient compared to what can be done at national level.

·Reinforcing the EU’s human capital – EU funded R&I activities support human capital reinforcement through mobility and training which provide access to complementary knowledge.
[47](#footnote48)
  300,000-340,000 researchers in the EU Framework Programmes teams are fully or at least partly involved in EU-funded research activities
[48](#footnote49)
. In the case of MSCA, evidence shows that the research impact of internationally mobile researchers is up to 20% higher than the impact of those who opt to stay in their home country
[49](#footnote50)
.

·Building multidisciplinary transnational networks for more impact – EU R&I activities build cross-sectoral, inter-disciplinary, intra- and extra-European research and innovation networks which is key for bringing knowledge quickly to market and gaining industrial leadership. Based on a counterfactual analysis, EU funded R&I teams had, on average, 13.3 collaborations versus six collaborations in the control group. The beneficiary teams also built almost two times more collaborations with partners from outside the EU (on average, 3.6 partners from third countries versus 2.1 partners in the control group).
[50](#footnote51)
 This leads to more impact: for example, Horizon 2020 publications including authors from associated and third countries score up to more than three times as much as the world average.
[51](#footnote52)
 

·Increasing the EU’s competitive advantage – EU R&I activities increase the competitive advantage of participants, for example through international multi-disciplinary networks, the sharing of knowledge and technology transfer and access to new markets. According to a counterfactual analysis, EU funded R&I teams grow faster (11.8% more)
[52](#footnote53)
. EU-funded R&I teams are around 40% more likely to be granted patents or produce patent applications compared with non-funded teams.
[53](#footnote54)
 Furthermore, patents produced in the context of EU Framework Programmes are of higher quality and likely commercial value than similar patents produced elsewhere.

·Creating new market opportunities through collaborative multi-disciplinary teams and dissemination of results - Compare to the national level, EU R&I activities involve key industrial players, SMEs and end-users, which reduces commercial risks, for example through the development of common standards and interoperable solutions and by defragmenting existing markets. EU funded collaborative R&I activities with open access policies enable a more rapid and wide dissemination of results to users, industries, firms (SMEs in particular), citizens, etc. – leading to a better exploitation and larger impact than would be possible only at Member State level.

·Strengthening the evidence-base for policy-making – EU funded R&I activities have an important role of supporting policy-making, which is for example illustrated by the results of EU funded projects related to antimicrobial resistance
[54](#footnote55)
 and EU funded projects in the field of climate change which played a key role in developing and aggregation climate change models, with a strong impact at the International Panel on Climate Change (IPCC).

·Leveraging private investment: EU funded R&I activities induce the private sector to invest more of their own funds than they would under national funding schemes. A counterfactual analysis shows a 24.6% difference in the budget leverage.
[55](#footnote56)
 Involving key EU industry players helps ensure that research results and solutions are applicable across Europe and beyond, enables the development of EU- and world-wide standards and interoperable solutions, and offers the potential for exploitation in a market of 450 million people: based on preliminary data, public-private partnerships (PPPs) are expected to attract between EUR 0.90 and 2.17 from private actors per each EUR of EU funding invested.
[56](#footnote57)
 Existing public-private partnerships in advanced manufacturing and processing (Factories of the Future, SPIRE and Energy-efficient Buildings) can already show private investments between 1.5 and 5.4 times the public funding, taking current investments into account and discounting intentions regarding future investments.
[57](#footnote58)
 Thanks to its leverage effect, it is estimated through macro-econometric modelling that each EUR of EU investment in R&I would bring a GDP increase of between EUR 6 and 8.5 during 2014-2030.

·High additionality – The EU invests in distinctive research and innovation projects, which are unlike those funded at national or regional level: the programme's additionality (i.e. not displacing or replacing national funding, see 
[Figure 3](#_Ref509433954)
) is very strong with, on average, 83% of projects that would not have gone ahead without Horizon 2020 funding.
[58](#footnote59)

Figure 3 Change in Government budget allocations for R&D and change in EU contribution between FP7 and Horizon 2020 (size of circles: number of applications in Horizon 2020)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08007.jpg)

Source: LAB-FAB-APP, Investing in the European future we want, Lamy High Level Group Report (2017)

|  |
| --- |
| What stakeholders say about the EU Added Value of EU programmes and funds    In their open responses to cluster based public consultation 2,541 stakeholders elaborated on the EU added value of EU programmes and funds. Four types of EU added value were most frequently mentioned:   Collaboration: 36% of respondents referenced collaboration and cooperation as an added value of the EU programmes and funds. Respondents noted the EU programmes and funds allow addressing macro-level challenges with a cross-border character (e.g. environmental sustainability, energy, health). The programmes also helps to access external expertise, competencies, resources and innovations that may not be available in one country, while allowing to scale-up and enhance innovative projects beyond national contexts. Multi-annual strategic plans and long-term strategies are also more helpful in aligning priorities between international partners than national programmes. Business and industry stakeholders frequently noted that the EU programmes and funds by default promote access to the EU single market that boosts their global competitiveness and help achieve greater long-term impacts. Here the creation of new cross-border value chains, standards and interdisciplinary partnerships between diverse stakeholders and markets that were not connected before is particularly pertinent. Civil society organisations note that improved collaboration contributes to the harmonisation of the EU market and policies, improves social cohesion among Member States and advances European integration. This allows achieving strategic development objectives, particularly in cases where critical mass and pooling of resources is present. In addition research organisations view international cooperation beyond the European Union as a considerable added value of the programmes, as it contributes to greater impact of research projects, expands possible partnership options and introduces a European dimension beyond the EU. A positive externality of this cooperation, according to research organisations, is the breakdown of research silos and the minimisation of research effort duplications.   Maximising competition: 22% of stakeholders underlined that the EU programmes and funds provide considerable improvements in competitiveness of participants by incentivising cross-border and cross-sectoral partnerships and thus contributing to pooling of resources, knowledge transfer along with other positive spill-over effects. Stakeholders also note that the EU programmes and funds improve the overall competitive edge of Europe by sustained investments in innovation that address pan-European and global societal challenges; and in the maintenance of effective innovation ecosystems throughout Europe. National public authorities note that while oversubscription is one of the main obstacles that prevent the programmes from achieving its objectives, high competition for funds also strengthens the European knowledge base and boosts the competitiveness of successful applicants. This is particularly pertinent, in-part due to increased visibility and exposure. Furthermore, performance benchmarking of participants by all applicants improves the overall performance, leading to more ambitious and higher quality projects, breakthroughs and increased impact. Regional public authorities note that EU R&I investments also strengthen the integration of SMEs into European value chains that improves efficiency.     Mobility: 10% of stakeholders noted that since quality research is not localised to a specific country, one of the most pronounced added value of EU programmes and funds is the support for the mobility of researchers, particularly through mechanisms such as Marie Skłodowska-Curie Actions (MSCA) and Erasmus. These are considered as vital in flagship programs that support scientific exchange, foster methodological innovation, multi-centred research collaborations, and a culture of joint research. Universities further note that support for mobility has several amplifying effects on the added value of EU programmes and funds, particularly in the form of skills and career development, as well as improvements in social cohesion and cooperation between European researchers, thus increasing the productivity of this community. Furthermore, it also provides greater freedom in choosing research topics and scope, partners, and impact areas than national efforts of EU Member states. International organisations meanwhile note that mobility contributes to successful cross-border collaboration, while also providing hardly measurable benefits to research and commercial activities.     Access to new markets: 9% of stakeholders noted that the programme, along with other EU funds and programmes stimulates access to the EU single market and new markets that may not exist or are too small on a national level. The support for the entire innovation chain (TRL 1 to 8) from the idea, to research and go-to market actions and partnerships, stemming from longer-term funding modalities helps achieving these objectives. Furthermore, the programmes are considered somewhat more successful in accelerating time-to-market of innovative solutions. Business and industry stakeholders further note that EU funds help reducing risks associated with R&D investments that on national and local levels are frequently funded through loans, allowing to divert additional resources to new market entry. Explicit incentives for research-industry cooperation also allow developing innovative products, thereby generating new markets and unlocking private sector investment in innovation provided ex-post market uptake. |

Annex 5: Macroeconomic modelling

Macroeconomic modelling is used to quantify the economic impact of the future EU R&I Programme in terms of GDP gain and job creation in the EU. While there is a general consensus
[59](#footnote60)
 that R&I are decisive in fostering productivity growth, quantifying the impact of R&I policies at a macroeconomic level requires modelling tools that appropriately capture how R&I translate into economic gains.

There are several models available for assessing the impact of R&I, with each model presenting specific features. This impact assessment uses results produced by three macroeconomic models: NEMESIS, QUEST and RHOMOLO. NEMESIS results were produced by a team of external experts
[60](#footnote61)
, while RHOMOLO and QUEST results were produced by the European Commission services (DG JRC for RHOMOLO and DG ECFIN for QUEST).

The strengths of these models rely on their specificities. Di Comite and Kancs (2015)
[61](#footnote62)
 consider that NEMESIS is the richest model in terms of innovation types and policy elasticities when compared to other standard macroeconomic models for R&D and innovation policies (QUEST, RHOMOLO, GEM-E3). The forward-looking dynamic approach of QUEST makes the model the most appropriate for assessing the impact of R&I innovation policies over time. By modelling regional economies and their spatial interactions, RHOMOLO is the most suitable model to address questions related to geographic concentration of innovative activities and spatial knowledge spillovers.

The three models are used to assess the impact of the baseline scenario in order to triangulate the signs, patterns and sizes of the impact of continuing the current Framework Programme. The specificities of the models are then used to produce additional sets of results: the rich set of elasticities and innovation channels in NEMESIS is used to assess the impact of modifying precise R&I parameters of the model that capture the changes foreseen in the future Programme, while the spatial dimension of RHOMOLO is used to assess regional impacts.

1NEMESIS

Presentation of the model

The NEMESIS model was developed by a European consortium
[62](#footnote63)
 in 2000 in order to analyse the macro-sectoral impacts of European structural policies. Its endogenous growth mechanisms were first based on R&D investments and the related knowledge spillovers. The model became a reference tool for the assessment of European or national research and innovation policies. Since 2004, the model has been used by the European Commission for several analyses, including the assessment of the 3% R&D effort in the Lisbon Strategy
[63](#footnote64)
, the assessment of the RTD National Action Plan related to the Barcelona Objective
[64](#footnote65)
 and the assessment of the impact of European research and innovation Programmes (ex-ante assessment of the 7th Framework Programme
[65](#footnote66)
 and of Horizon 2020
[66](#footnote67)
). In 2017, NEMESIS has been used for the ex-post assessment of the 7th Framework Programme and the interim evaluation of Horizon 2020
[67](#footnote68)
.

Structure

NEMESIS is a macroeconometric model composed of a system of sectoral detailed models for every EU countries. The endogeneisation of technical progress in NEMESIS is derived from the new growth theories where innovations result from the investment in R&D by private firms and from the R&D achieved by the public sector. In the new version of NEMESIS used for this impact assessment, innovations still arise from firms’ and public investments in R&D, but also from investments in two other complementary innovation inputs: ICT and Other Intangibles (including training and software). These improvements have allowed enhanced accuracy in assessing research and innovation policies by considering the most up-to-date theoretical as well as empirical findings of the economic literature (Le Mouël, et al., 2016).

|  |
| --- |
| How NEMESIS models R&I  1 Firms determine their investments in the three innovative assets (private R&D, ICT and OI).  2 The investment effort feeds their own knowledge (stock variable) as well as the knowledge in others sectors and countries through knowledge matrices (knowledge transfers). For each innovative asset, these knowledge stocks are modelled as a weighted sum of the stock of assets, R&D, ICT or OI, belonging to all sectors and countries. The spread parameters used to build these stocks are calibrated using matrices based on patent citations between sectors and countries. These matrices combine the citations between patents allocated by technology classes and country with the OECD concordance table, in order to allocate these citations between sectors (Johnson, 2002).  3 The growth of the knowledge stock of each innovation asset coupling with the knowledge absorption capacity (measured with the investment intensity in each innovative asset) generates innovations.  4 These innovations take two forms: product and process. Product innovation increases the intrinsic quality of the product sold by the firms whereas process innovation improves the production process without changing the quality of the product sold (pure TFP effect). This distinction between process and product innovations is crucial as econometric studies show that process innovations alone have a negative, or only a slight positive impact on employment, whereas the impact of product innovations is always positive (Hall, 2011).  5 New product innovations raise internal as well as external demands for the enhanced product. New process innovation reduce the production cost of the sector that, in a context of competitive market, will reduce the end-user prices of the product and then increase its demand on the internal and external markets.   6 All these dynamics at sectoral level are brought together by the input-output tables of the model. Then, the combination of these sectoral interdependencies (“bottom-up”) with the “top-down” macro-economic forces impulses the medium and long term dynamics of the model. These macroeconomic forces depend mainly on the labour market and the wage setting that are the drivers for the final consumption of vaughan, and also for the domestic production prices and so of the competitiveness of the economy |

The macroeconomic dynamic in NEMESIS can be summarised in three main phases:

1. An investment phase that is a “demand phase” in which all the dynamics are induced by the change in the R&D expenditures without or with moderated impacts of the innovation (as the innovations take time to appear). This phase can be viewed as a Keynesian multiplier.

2. The innovation phase: the arrival of innovation (process and product) reduces the production cost of the new products or raises their quality that induces an increase of external and internal demands.

3. The obsolescence phase: progressively the new achieved knowledge declines because of the knowledge obsolescence
[68](#footnote69)
 and in the long-term, the macro-economic track goes back to the reference scenario.

Key assumptions for the impact assessment

Key assumptions in NEMESIS for assessing the impact of the Framework Programme are related to budget size, budget allocation and the value of key parameters such as leverage
[69](#footnote70)
 and performance.

|  |  |
| --- | --- |
|  | Key assumptions (continuation of Horizon 2020) |
| Budget size | Continuation of Horizon 2020 budget in constant prices – 15% |
| Budget allocation across years, countries and sectors | Horizon 2020 allocation |
| Knowledge spillovers | Inter-sectoral and international spillovers modelled using patent citation techniques with no additional specificity for the Framework Programme. |
| Direct leverage effect | Direct leverage:  - Basic research: 0  - National funding of applied R&I: 0.1  - EU funding of applied R&I: 0.15  Indirect leverage: firms keep their investment effort constant in the long term. |
| Economic performance | Higher performance of EU funding (+15%) compared to national funding |
| Financing | Reduction in public investment |

Budget size and allocation are assumed to be the same as in Horizon 2020 in constant prices, minus the contribution from the UK (assumed to be 15% of the budget). The Programme is assumed to be financed by lowering national public investment. Regarding the direct leverage effect, the assumptions used are supported by a survey
[70](#footnote71)
 on research units involved in the 7th Framework Programme and by the empirical literature
[71](#footnote72)
. A sensitivity analysis
[72](#footnote73)
 shows that this parameter does not significantly drive the results produced for this impact assessment. Economic performance in NEMESIS is calibrated by country and sector on the basis of the available empirical literature. A higher leverage and performance parameter for EU funding compared to national funding reflects the benefits related to the EU added value of the Programme, with values that are supported by existing quantified evidence on publications, patents and revenues from innovations
[73](#footnote74)
.

In order to assess the impact of the various changes regarding the structure and priorities of Horizon Europe, each of the changes for more impact and more openness (section 3) was translated into variations of the parameters in NEMESIS. While the sign of these variations is straightforward, their size is uncertain. Therefore, different scenarios were considered, from low to high, by using ranges in the variation of the parameters. These ranges rely on plausible values found in the literature
[74](#footnote75)
, with extreme values showing how impactful Horizon Europe can be in the most ambitious and optimistic conditions.

Table 2 Assumptions in NEMESIS

|  |  |  |
| --- | --- | --- |
| Changes for more impact | This assumes … | Range |
| Higher economic performance | Focus on R&I with higher economic impacts and on breakthrough innovations. | Higher performance of EU funding compared to national funding: +0 (baseline) to +5 percentage points. |
| Lower knowledge obsolescence | More focus on breakthrough knowledge. | 14% to 13% obsolescence rate compared to 15% in the baseline. |
| Stronger complementarities with other innovative assets | More cross-technological and cross-sectoral R&I. | 5% to 10% stronger than in the baseline. |
| Higher direct leverage of private R&D | Better access to finance of innovative firms, especially for SMEs. | 0.1 (baseline) to 0.15. |
| Changes for more openness | This assumes … | Range |
| Higher complementarities with national support to R&D | Increased complementarities through partnerships. | Increased leverage for basic research: 0.05 to 0.1 compared to 0 in the baseline. |
| Stronger knowledge diffusion | Facilitated knowledge diffusion nationally, between the different categories of research organisations and/or internationally. | 5% to 10% stronger than in the baseline. |

Results

Results from the NEMESIS model indicate that the Framework Programme is expected to generate large GDP gains. The continuation of the Framework Programme is expected to produce 0.08% of additional GDP on average over 25 years, which means that each euro invested can potentially generate a return ranging from 10 to 11 euros of GDP gains over the same period
[75](#footnote76)
. The highest gains (+0.31% of GDP) are expected to occur around 2034.

Figure 4 GDP impact of the continuation of Horizon 2020 (NEMESIS, deviation in % from a situation without Framework Programme) 

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08009.jpg)

Source: Seureco (2018), Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme.

The impact on jobs is also substantial. Over the period of the Programme, up to 100 thousand jobs are expected to be directly created in R&I activities. During this period, while the Programme has a positive effect on jobs in R&I, the decrease in national public investment that is assumed by the model is mechanically accompanied by a comparable decrease in non R&I-related jobs. The net indirect impact of the Programme on jobs materialises as from 2030, with the creation of more than 200 thousand jobs after 2035, including more than 80 thousand high-skilled jobs.

Figure 5 Employment impact of the continuation of Horizon 2020 (NEMESIS, deviation in thousand jobs from a situation without Framework Programme)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08010.jpg)

Source: Seureco (2018), Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme

Compared to the continuation of Horizon 2020, the changes in the design of the Programme can potentially generate an additional GDP gain up to 0.04% in a low scenario, and up to 0.1% in a high scenario. The impact of the changes is expected to be the most significant after 2030. The total impact of the Programme on EU GDP would be between EUR 800 billion and EUR 975 billion over 25 years.

Figure 6 Decomposition of GDP impact of changes for more impact and more openness (deviation in % from the continuation of Horizon 2020, scenarios based on highest values of the ranges)

|  |  |
| --- | --- |
| Changes for more impact | Changes for more openness |

Source: Seureco (2018), Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme

Figure 7 GDP impact of changes for more impact and more openness (deviation in % from a situation without Framework Programme)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08013.jpg)

Source: Seureco (2018), Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme

Limitations of the model

While NEMESIS’ strengths justify its relevance for measuring the impact of R&I policies, the model’s specificities and approach also imply a number of limitations to be taken into account when interpreting the results. First, it relies on the empirical observation of relationships and allows for flexibility in behavioural functions, which may generate inconsistencies among the most recent developments in macroeconomic theory. Furthermore, it does not use forward-looking expectations but adaptive ones. Regarding the use of human capital in the model, NEMESIS does not link that with investments in the educational system.

2QUEST

Presentation of the model

The QUEST model is a global dynamic general equilibrium model developed by the Directorate General for Economic and Financial Affairs of the European Commission
[76](#footnote77)
. The different model variants have been extensively used for macroeconomic policy analysis and research, e.g. analysing the impact of fiscal and structural reforms and assessing the impact of Cohesion Policy
[77](#footnote78)
. QUEST is a fully dynamic structural macro-model with rigorous microeconomic foundations derived from intertemporal utility and profit optimisation. The model also accounts for frictions in goods, labour and financial markets.

Structure of the model

QUEST belongs to the class of micro-founded dynamic general equilibrium (DGE) models that are now widely used in economic policy institutions as the latest step in the development of macroeconomic modelling. The focus in these models is on the economy as a whole, as an integrated system of economic agents that base their economic decisions over a range of variables by continuously re-optimising, subject to budgetary, technological and institutional constraints. These models are forward-looking and intertemporal, i.e. current decisions account for expectations about the future.

This impact assessment uses the semi-endogenous growth version of the European Commission’s QUEST model with an R&D production sector (QUEST3RD). The model economy is populated by households, final and intermediate goods producing firms, a research industry, a monetary and a fiscal authority. In the final goods sector, firms produce differentiated goods which are imperfect substitutes for goods produced abroad. Final good producers use a composite of intermediate goods and three types of labour: low-, medium-, and high-skilled. The model has two types of households, liquidity and non-liquidity constrained, a feature which has become standard in dynamic stochastic general equilibrium modelling. Liquidity constrained households have no access to financial markets. They simply consume their current income at each period. Non-liquidity constrained households buy the patents of designs produced by the R&D sector and license them to the intermediate goods producing firms. The intermediate sector is composed of monopolistically competitive firms, which produce intermediate products from rented capital input using the designs licensed from the household and by making an initial payment to overcome administrative entry barriers. The production of new designs takes place in research labs, employing high skilled labour and making use of the commonly available domestic and foreign stock of knowledge. Importantly, the model is a global multi-country model of the EU Member States and the rest of the world in which individual country blocks are interlinked with international trade and knowledge spillovers.

Assumptions used for the impact assessment

|  |  |
| --- | --- |
|  | Key assumptions (continuation of Horizon 2020) |
| Budget size | Continuation of Horizon 2020 budget in constant prices – 15% |
| Budget allocation across years, regions and sectors | Horizon 2020 allocation |
| Spillovers | International trade and knowledge spillovers, based on trade statistics and elasticities in the relevant literature. |
| Direct leverage effect | Identical leverage of EU funding and national funding |
| Economic performance | Identical performance of EU funding and national funding |

For this impact assessment, results were produced based on two scenarios regarding the financing of the Framework Programme. In a first scenario, financing relies on raising additional VAT revenues in the Member States. The second scenario assumes that future Programme is financed at the expense of lowering national public investment.

Results

The results highlight the importance of the underlying financing assumptions. As value added taxes are some of the least distortive taxes, financing productivity-enhancing R&D investments from these resources is unambiguously beneficial at the EU level in the medium and long run (see left side graph in

[Figure](#_Ref514321545)
[8](#_Ref514321545)
a).

By changing from VAT financing to public investment cuts (e.g. roads, buildings), Members States loose the potential productivity effects of these public investments and the GDP results are lower both in the short- and long-run (second panel in

[Figure](#_Ref5143215)
[8](#_Ref5143215)
b).

Figure 8 GDP impact of the continuation of Horizon 2020 (QUEST, deviation in % from a situation without Framework Programme)

|  |  |
| --- | --- |
|  |  |

a. VAT financed
   
   
   
   
   
   b. Financed through public investment cuts

Source: European Commission, DG ECFIN

There is a small short-run output loss due to crowding out effects in the beginning of the intervention period. This is because R&D subsidies stimulate innovation by helping R&D intensive companies to attract more high-skilled labour from traditional production into research with higher wages. In the second scenario, the expected GDP effects are less beneficial at the EU level. Similar to R&D investments, public investment is also productivity-enhancing, therefore, this type of financing is more costly for the Member States. It also takes longer to compensate the short-run output loss.

In both scenarios, the GDP gains peak around the 2030-2032 period, up to 0.14%, and gradually decrease after the Programming period due to the depreciation of tangible and intangible capital. The average impact over 25 years can reach up to 0.14% over 25 years. Note, that in the QUEST simulations EU and nationally funded R&I have the same leverage and performance effects.

Limitations of the model

Although the model is well-suited to simulate the effect of public financed subsidies to private R&D, it does not distinguish between research undertaken in private or public R&I entities. All R&D activities are carried out by a (virtual) R&D sector. Being an aggregate macroeconomic model, QUEST also misses the extensive regional details present in RHOMOLO.

3RHOMOLO

Presentation of the model

RHOMOLO is the spatial computable general equilibrium model of the European Commission focusing on EU regions. It has been developed and maintained by the regional economic modelling team at the Directorate-General Joint Research Centre (DG JRC) in cooperation with Directorate-General for Regional and Urban Policy (DG REGIO). It is used for policy impact assessment and provides sector-, region- and time-specific simulations to support to EU policy making on investments and reforms covering a wide array of policies. RHOMOLO is built following a micro-founded general equilibrium approach
[78](#footnote79)
 and is used to provide a breakdown of results by region and sector.

  

Structure of the model

RHOMOLO is a spatial dynamic general equilibrium model that covers 267 regions at the NUTS2 level. Each region contains 10 economic sectors. A subset of these operates under monopolistic competition. The rest of the sectors operate under perfect competition. Regional goods are produced by combining labour and capital with domestic and imported intermediates, creating vertical linkages between firms.

Final goods are consumed by households, government and investors. Each region is inhabited by a representative household which supply labour of three skills type, consume and save. The government levy taxes, purchases public consumption goods, conduct public investments and allocate transfers to the various agents in the economy. Goods and services can be sold in the domestic economy or exported to other regions. Trade between regions is associated with a set of bilateral regional transportations costs. The RHOMOLO model incorporates imperfect competition in the labour market. The model allows one to switch from a wage curve to a Phillips curve. RHOMOLO contains two types of capital, sector specific private capital and public capital available to firms in all sectors within the region.

|  |
| --- |
| How RHOMOLO models R&I   R&D expenditure is modelled as private investments. Hence, R&D spending generates demand for capital goods. In addition, R&D spending leads to the accumulation of an intangible knowledge capital stock which in turn spills into an increase in total factor productivity (TFP).   Expenditure for R&D support is introduced into the model as a reduction in user cost of capital which in turn generates an increase in R&D investments.   The impact of R&D expenditure on total factor productivity through the accumulated knowledge capital stock is captured by a set of regional spillover elasticities which are conditional on R&D intensity within the region. Higher regional R&D intensity is associated with higher spillover from knowledge capital to TFP. The R&D spillover elasticities are based on estimates by Kancs and Siliverstovs (2016) [79](#footnote80) . |

Assumptions used for the impact assessment
[80](#footnote81)

|  |  |
| --- | --- |
|  | Key assumptions (continuation of Horizon 2020) |
| Budget size | Continuation of Horizon 2020 budget in constant prices – 15% |
| Budget allocation across years, regions and sectors | Horizon 2020 allocation |
| Regional spillovers | Regional spillovers are conditional on R&D intensity within the regions. |
| Direct leverage effect | Direct leverage: Calculated as a weighted average from NEMESIS  Indirect leverage: Determined endogenously by the models investment demand specification |
| Economic performance | Identical performance of EU funding and national funding |
| Financing | Reduction in public investment |

The regionalisation of funding is based on the regional distribution of existing Programme spending. Hence, it is assumed that future R&I support would follow the same regional distribution as previous spending programmes. 
[Figure 9](#_Ref508779909)
 shows the assumed regional accumulated spending for R&D support for the period 2021-2027 in percent of GDP. Large regional variations in spending can be observed.

Figure 9 Accumulated regional spending in support of R&D in the reference scenario (percent of GDP)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08016.jpg)

Source: European Commission, DG JRC

The impact of the Spreading Excellence and Widening Participation (SEWP) programme is also measured using RHOMOLO by using the regional allocation of funds for the years 2014-2015 under SEWP. The largest receivers of funding were regions in Cyprus, Hungary, Slovenia, Portugal and Estonia. The funding is mainly concentrated in regions in the widening countries. However, some regions in other member states also receive funding through participation in project with counterparts in the widening countries.

Results

Results from RHOMOLO show significant benefits of continuing the EU R&I Programme compared to a situation in which funding is reallocated to national public investments. The Programme is expected to generate up to 0.17% (in 2020) of additional GDP compared to a situation without Framework Programme, with an average impact of 0.08% of GDP over 25 years.

  

Figure 10 GDP impact of the continuation of Horizon 2020 (RHOMOLO, deviation in % from a situation without Framework Programme)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08017.jpg)

Source: European Commission, DG JRC

Key regional results from the model are the following:

·Regions from all Member States are directly or indirectly impacted by SEWP measures, not targeted countries only.

·Regional impact of the SEWP can reach up to 0.18% of regional value added in some regions.

·Each Euro invested in the SEWP part of the Framework Programme is expected to bring similar return in terms of GDP gain compared to the rest of the Programme.

Limitations of the model

While the spatial dimension of RHOMOLO is clearly a key strength of the model, the extensive regional disaggregation of the model requires that the dynamics are kept relatively simple
[81](#footnote82)
, implying that the optimisation problems in RHOMOLO are inherently static and do not acknowledge the inter-temporal consequences of innovation decisions that can change not only the level but also the rate of growth of regional economies. The model is solved by recursive dynamics. Furthermore, RHOMOLO does not explicitly distinguish between private and public R&D investments or between types of endogenous innovation.

4Comparison of results

RHOMOLO, QUEST and NEMESIS are three different models corresponding to different approaches and with very different specifications and settings of parameter values. One should therefore not expect the three models to produce identical estimates of the economic impact of a given policy change. However, comparing the findings from the three models for the baseline scenario (i.e. the continuation of Horizon 2020) allows assessing the consistency of the impacts identified in each model and contributes to address to some extent the issue of model uncertainty.

  

Figure 11 GDP impact of Horizon 2020 continuation (deviation in % from a situation without Horizon 2020)

 

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08018.jpg)

Source: European Commission, DG Research and Innovation. Note: EU+ indicates that Nemesis uses higher performance and leverage for EU funding compared to national funding as a reflection of the EU added value of the Programme. QUEST \*1 assumes that financing of the Programme relies on VAT increase. QUEST \*2 assumes that financing relies on lowering public investment.

Overall, NEMESIS, QUEST and RHOMOLO present consistent results in terms of sign and temporal pattern of the GDP gain from the Framework Programme (compared to the discontinuation of the Programme) over 2021-2050. The three models show a strong increase in the GDP impact during or after the period covered by the Programme, with highest impacts expected between 2029 and 2034. The size of the GDP gain is the highest based on the NEMESIS results. This can be explained by the fact that the three models use different sets of innovation channels and elasticities. Furthermore, the parameters and mechanisms in QUEST and RHOMOLO do not directly take into account the higher leverage and performance expected from EU funding of R&I compared to national funding, which are acknowledged in NEMESIS as an illustration of the EU added value of the Framework Programme.

  

Annex 6: Indicators

1Key Impact Pathways Indicators

1.1Scientific impact pathway indicators

The Programme is expected to have scientific impact by delivering creating high-quality new knowledge, strengthening human capital in R&I, and fostering the diffusion of knowledge and Open Science. Progress towards this impact will be monitored through the proxy indicators in 
[Figure 12](#_Ref511642930)
, set along three key impact pathways.

Figure 12 Key scientific impact pathways indicators

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  | Short-term | Medium-term | Longer-term | Scientific impact | |
| 1 Message: Horizon Europe generates world-class science, as shown by the high-quality publications that become influential in their field and worldwide [82](#footnote83) . | | | | |
|  | Publications -  Number of FP peer reviewed scientific publications [83](#footnote84) | Citations -  Field-Weighted Citation Index of FP peer reviewed publications | World-class science -  Number and share of peer reviewed publications from FP projects that are core contribution to scientific fields | Creating of high-quality new knowledge | |
| Data needs: identification of publications co-funded by the FP through the insertion of a specific DOI for the FP (funding source code) when publishing, allowing follow-up tracking of the perceived quality and influence through publication databases and topic mapping. | | | | |
| 2 Message: Horizon Europe strengthens human capital, as shown by the improvement in skills, reputation and working conditions of participants [84](#footnote85) . | | | | |
|  | Skills -  Number of researchers having benefitted from upskilling activities in FP projects (through training, mobility and access to infrastructures) [85](#footnote86) | Careers -  Number and share of upskilled FP researchers with more influence in their R&I field | Working conditions -  Number and share of upskilled FP researchers with improved working conditions | Strengthening human capital in R&I | |
| Data needs: collection of unique identifiers of individual applicants to the FP at proposal stage, allowing follow-up tracking of their influence in their field through publication and patent databases, awards and prizes, as well as evolution of working conditions through salary levels and benefits. | | | | |
| 3 Message: Horizon Europe opens up science, as shown by research outputs shared openly, re-used and at the origin of new transdisciplinary/trans-sectoral collaborations [86](#footnote87) . | | | | |
|  | Shared knowledge -  Share of FP research outputs (open data/ publication/ software etc.) shared through open knowledge infrastructures | Knowledge diffusion -  Share of open access FP research outputs actively used/cited after FP | New collaborations -  Share of FP beneficiaries having developed new transdisciplinary/ trans-sectoral collaborations with users of their open FP R&I outputs | Fostering diffusion of knowledge and Open Science | |
| Data needs: Identification of research outputs (in particular publications and research data) co-funded by the FP through the insertion of a specific DOI for the FP when publishing or sharing openly (e.g. OA journals/platforms (publications) and open FAIR repositories (data)), allowing follow-up tracking of open access performance in terms of active use/citations and collaborations. | | | | |

1.2Societal impact pathway indicators

The Programme is expected to have societal impact by addressing EU policy priorities through R&I, delivering benefits and impact through R&I missions, and strengthening the uptake of research and innovation in society. Progress towards this impact will be monitored through the proxy indicators in 
[Figure 13](#_Ref514437190)
, set along three key impact pathways.

Figure 13 Key societal impact pathways & progress indicators

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  | Short-term | Medium-term | Longer-term | Societal impact |
| 4 Message: Horizon Europe helps addressing EU policy priorities (including meeting the SDGs) through research and innovation, as shown by the portfolios of projects generating outputs contributing to tackling global challenges. | | | | |
|  | Outputs -  Number and share of outputs aimed at addressing specific EU policy priorities (including meeting the Sustainable Development Goals (SDGs)) | Solutions -  Number and share of innovations and scientific results addressing specific EU policy priorities (including meeting the SDGs) | Benefits -  Aggregated estimated effects from use of FP-funded results, on tackling specific EU policy priorities, including contribution to the policy and law-making cycle | Addressing EU policy priorities through R&I |
|  | Data needs: Projects classified according to the specific EU policy priorities (including the SDGs) pursued and follow-up tracking of their outputs, results and impacts. Portfolio analysis on effects from scientific results & innovations in specific EU policy priority/SDGs areas, text mining. | | | |
| 5 Message: Horizon Europe produces knowledge and innovation that contribute to achieving missions of EU interest  [87](#footnote88) . | | | | |
|  | R&I mission outputs -  Outputs in specific R&I missions | R&I mission results -  Results in specific R&I missions | R&I mission targets met -  Targets achieved in specific R&I missions | Delivering benefits and impact through R&I missions |
| Data needs: Projects classified according to the missions pursued and follow-up tracking of their outputs, results and impacts according to the target set. Portfolio analysis on effects from scientific results & innovations in mission areas. | | | | |
| 6 Message: Horizon Europe creates value for European citizen, as shown by the engagement of citizen in the projects and beyond the projects by improved uptake of scientific results and innovative solutions [88](#footnote89) . | | | | |
|  | Co-creation -  Number and share of FP projects where EU citizens and end-users contribute to the co-creation of R&I content | Engagement -  Number and share of FP beneficiary entities with citizen and end-users engagement mechanisms after FP project | Societal R&I uptake -  Uptake and outreach of FP co-created scientific results and innovative solutions | Strengthening the uptake of innovation in society |
| Data needs: Collection of data at proposal stage on the roles of partners (incl. citizen) in the projects, structured survey of beneficiary entities and tracking of uptake and outreach through patents and trademarks and media analysis. | | | | |

1.3Economic impact pathway indicators

The Programme is expected to have an economic/innovation
[89](#footnote90)
 impact by influencing the creation and growth of companies, creating direct and indirect jobs, and by leveraging investments for research and innovation. Progress towards this impact will be monitored through the proxy indicators in 
[Figure 14](#_Ref501450779)
, set along three key impact pathways.

Figure 14 Key economic impact pathways indicators

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  | Short-term | Medium-term | Longer-term | Economic impact |
| 7 Message: Horizon Europe is a source of economic growth, as shown by the patents and innovations that are launched on the market and generate added value for businesses [90](#footnote91) . | | | | |
|  | Innovative outputs -  Number of innovative products, processes or methods from FP (by type of innovation [91](#footnote92) ) & Intellectual Property Rights (IPR) applications [92](#footnote93) | Innovations -  Number of innovations from FP projects (by type of innovation) including from awarded IPRs | Economic growth -  Creation, growth & market shares of companies having developed FP innovations | Innovation-based growth |
| Data needs: Reporting of beneficiaries on innovative products, processes or methods from FP and their practical use, and insertion of a specific DOI for the FP (funding source code) when filling IPR applications, allowing follow-up tracking of the patents through patent databases and trademarks (“follow the investor approach”). | | | | |
| 8 Message: Horizon Europe generates more and better jobs, initially in the projects, and then through the exploitation of the results and their diffusion in the economy [93](#footnote94) . | | | | |
|  | Supported employment -  Number of FTE jobs created, and jobs maintained in beneficiary entities for the FP project (by type of job [94](#footnote95) ) | Sustained employment -  Increase of FTE jobs in beneficiary entities following FP project (by type of job) | Total employment -  Number of direct & indirect [95](#footnote96)  jobs created or maintained due to diffusion of FP results (by type of job) | Creating more and better jobs |
| Data needs: Collection of information on individuals involved in FP projects at proposal stage, including their workload (Full Time Equivalent) and job profile allowing follow-up tracking of employment in beneficiary organisations. Longer-term indicator will be an estimate based on a dedicated study. | | | | |
| 9 Message: Horizon Europe is leveraging investments for research and innovation in Europe, initially in the projects, and then to exploit or scale-up their results [96](#footnote97) . | | | | |
|  | Amount of public & private investment [97](#footnote98)  mobilised with the initial FP investment | Amount of public & private investment mobilised to exploit or scale-up FP results | EU progress towards 3% GDP target due to FP | Leveraging investment |
|  | Data needs: Data on co-funding in FP projects by source of funds including other EU funds (e.g. ESIF), collection of unique identifiers of applicants to the FP at proposal stage (e.g. VAT), allowing follow-up tracking of their capital. Longer-term indicator will be an estimate based on a dedicated study. | | | |

  

2Key Management and Implementation Data

This section specifies a number of key management data for assessing the state of implementation of the Programme. The data covers the inputs and activities of the Programme, including the European Partnerships.

·Number of proposals and applications submitted, EC contribution requested and total costs of submitted proposals (by source of funds)

·Number of proposals reaching the quality threshold (funded/not funded)

·Number of retained proposals

·Success rates of proposals

·EC contribution and total costs of retained proposals (by source of funds)

·Number of participations and single participants

This information shall be collected according to:

·Types of action

·Types of organisations, including Civil Society Organisations (with specific data for SMEs)

·Countries and regions of applicants and participants (including from associated and third countries)

·Sectors

·Disciplines

Data shall also be monitored on the profiles of beneficiaries and evaluators:

·Gender balance (in projects, in EC advisory groups and evaluators)

·Role(s) in project
[98](#footnote99)
 

·Share of newcomers to the Programme

Data shall also be monitored on the implementation processes:

·Time-to-grant

·Time-to-pay

·Error rate

·Satisfaction rate

·Rate of risk taking

Data shall also be monitored on:

·The financial contribution that is climate-related

Data shall also be collected on:

·Communication of R&I results

·Dissemination of R&I results

·Exploitation and deployment of R&I results, including through monitoring the funding allocated for uptake of research and innovation results through the instruments listed in Annex 7 on synergies with other EU programmes.

  

Annex 7: Synergies with other proposals under the future Multiannual Financial Framework

1Why do we need synergies between EU programmes?

The set of EU funding programmes under the next multiannual budget must be closely linked to each other, and they must work in synergy. This can be described as:

ØCompatibility: harmonisation of funding rules for projects; making co-funding schemes more flexible; pooling resources at EU level;

ØComplementarity between EU programmes: no overlap in funding;

ØCoherence: alignment of strategic priorities in support of a common vision.

An important lesson learned from the Horizon 2020 interim evaluation is that, in cases where those programmes were not designed with a clear strategic overview on their complementarities from their inception, it proved difficult to ensure full complementarity and coherence at the implementation stage.

More effective synergies between EU programmes under the next EU Multinational Financial Framework (MFF) will make the EU's overall investments more effective, readable and able to provide better value for citizens. It will amplify the impact of EU-level investments in R&I for creating jobs, growth and competitiveness on the ground by bringing European, national and regional R&I funding schemes better into play. Ultimately, they should contribute in a complementary way to a common vision and shared objectives on tackling the major challenges facing Europe and ultimately make the EU as a whole better equipped to face ever-increasing competitive pressure from global markets.

|  |
| --- |
| What have we learned from the Horizon 2020 Interim Evaluation?     "It is difficult to assess to what extent the political willingness to increase Horizon 2020's external coherence has translated into practical implementation. Given different rules and implementation structures, and varying scale and scope of programmes, promoting synergies at project level (in terms of combining different financing sources for the same project) still appears difficult" [99](#footnote100) .  Differences in applicable rules lead to legal uncertainty for potential applicants; while communication, coordination and support for synergies between all institutional actors involved is not optimal.  "Despite initiatives being taken to reinforce synergies with other EU funds, notably the ESIF, further coherence is hampered by the different intervention logics and complexity of the different funding and other rules " [100](#footnote101) .  "The main areas to be addressed to improve the generation of synergies and to boost their impacts on regional development, on growth, job creation and tackling societal challenges are: strategic framework and programming; generation of concrete guidance and implementation of best practice; monitoring. These issues should support a more specific, widespread, efficient and effective implementation of synergies between Horizon 2020 and ESIF" [101](#footnote102) . |
|  |

Exploring synergies between the Framework Programme and other MFF proposals related to the support of the research and innovation systems at the programme design stage aims to:

(I)ensure complementarity in designs and objectives of the different Programmes to ensure the most efficient use of limited public resources and enhanced readability for beneficiaries;

(II)capture the scope of the activities supported through the different Programmes to ensure full synergies and coherent approaches on the ground for instance through aligned strategic programming processes (e.g. on priority areas, partnerships), and common missions to guide funding priorities of different Programmes;

(III)ensure the development of complementary and combined funding across programmes and facilitate the implementation of the Seal of Excellence

|  |
| --- |
| What do stakeholders say?  The large majority of stakeholders state the broad view that increased synergies, coordination and strategic alignment with other EU programmes would help to maximise the impact of the future EU R&I programme.  In general, this is a consistently high priority for other EU institutions:  ·[The European Parliament]"Notes that synergies between funds are crucial to make investments more effective….regrets the presence of substantial barriers to making synergies fully operational and seek, therefore, an alignment of rules and procedures for R&D&I projects under ESIF and FP…..encourages the Commission to enhance synergies between the Framework Programme and other dedicated European funds for research and innovation, and to establish harmonised instruments and aligned rules for those funds" [102](#footnote103) .  ·[The Council] "Highlights the importance of improved synergies and complementarities between the FP and other EU funding instruments. Considers therefore that regulations for the next FP and the European Structural and Investment Funds, as well as state aid rules and any other relevant EU programmes must be designed from the very beginning with synergies, coherence, compatibility and complementarity in mind in order to provide a level playing field for similar projects under different management modes and to consider harmonization of funding rules for R&I towards those of the FP" [103](#footnote104) .  Specific suggestions from stakeholder organisations include:  ·To include education activities in relevant parts of the EU R&I programme and secure synergies with the next EU framework programme for education.  ·To increase the impact of national and regional funding coming from ESIF allocated to R&I activities, to allocate a minimum specific percentage of the budget devoted to synergies with the R&I programme for each Member State.  ·To step up efforts for the ‘Seals of Excellence’ enabling excellent-but-unfunded projects submitted to the R&I programme to be funded under other schemes (including private, national, other EU funds).  ·To co-construct the future R&I and ESIF programmes by ensuring efficient support from the ESIF funds to excellent R&I projects in capacity-building (upstream) and uptake of results (downstream).  ·Request for broader acceptance of usual cost-accounting practices and for the introduction of the single audit principle/cross-reliance on audits. |

2The role of the Framework Programme in the EU R&I support system

The Framework Programme remains the sole EU programme supporting mainly trans-national research and innovation activities and networks, including through partnerships with Member States, businesses and foundations, based on the key criteria of excellence. This includes the trans-national access to and integration of national research infrastructures across Europe and the development of ESFRI
[104](#footnote105)
 pan-European research infrastructures.

The Framework Programme will cover activities that support the development, demonstration and market uptake of innovative solutions (through co-creation, EIC’s Accelerator, public procurement) that usually have a trans-national dimension or require more support than may be provided for at national/regional level, and are first-of-a-kind innovative solutions for Europe. Across its activities the programme will support the development of the skills of researchers and innovators involved. While the Framework Programme is open to participation from all Member-States and beyond, it will continue to support the building of capacity in low-performing countries in R&I through dedicated collaboration-based schemes - including for policy reforms, in the context of strengthening the European Research Area, including outermost regions.

Other programmes under the next MFF will provide support for research and innovation activities, including demonstration of solutions tailored to specific national/regional contexts/needs, as well as bilateral and interregional initiatives. In particular, the European Regional Development Funds support the building of research and innovation eco-systems in the Member States in terms of infrastructures, human resources, modernisation of the public and private sectors, and (inter)regional cooperation networks, such as clusters structures. MFF programmes such as the Connecting Europe Facility (CEF), the Digital Europe Programme (DEP), the European Social Fund (ESF) or LIFE make notably use of public procurement as one instrument to deploy physical infrastructures and innovative technologies and solutions in specific areas - that can originate from the Framework Programme activities, but not only.

The Framework Programme will also provide support for R&I activities underpinned by these infrastructures and facilities, including testing, experimentation and demonstration across all sectors and disciplines. Actions implemented through other MFF programmes will provide the backbone for system transitions (e.g. infrastructures for energy transition) and ensure supportive framework conditions such as interoperability, standards, innovation-friendly regulations, but also enhanced skills and awareness of the wider population, the spreading of best practice in research and innovation policy implementation, but also for the wider diffusion and uptake of (European) innovations in the international arena, e.g. through external action.

Overall the wider dissemination of R&I results attained through the Framework Programmes towards a broader audience within the European institutions but also Member States and other stakeholders will be encouraged. Through the Seal of Excellence, high-quality but unfunded proposals under the Framework Programme will continue to be promoted for support through alternative funding sources, including ERDF or ESF where relevant.

Moreover, the development of the corporate eGrants/eProcurement suite of business processes and IT tools for all centrally managed programmes will provide for harmonised implementation and improved possibilities for exploiting synergies at project level. Cross-reliance on audits of other EU programmes could also be considered, although its effectiveness will depend on the homogeneity of the rules between programmes.

Table 3 Support to R&I projects/activities, incl. closer-to-market activities, replication & diffusion of technologies & innovative solutions – Complementarities Framework Programme/ Other EU programmes

|  |  |
| --- | --- |
| Horizon Europe | What will the other EU programmes typically cover? |
| R&I activities/projects:  -Programme focussed on excellent R&I from TRL 1-9 with continued strong focus on collaborative R&I  -Support to individual entities and transnational collaborations (top down and bottom-up)  -Mainly grants for TRL 1-8; repayable or convertible advances, equity and/or guarantee for loans (no grants) for TRL 5/6-9  -Support technological & non-technological innovations ((citizen science, user-led innovation, social innovation, business model innovation, public sector innovation etc.), including innovative delivery mechanisms  -Continuation of Coordination and Support Actions  -Incentives for institutional changes towards Responsible Research and Innovation (RRI) and gender equality.   -Continued streamlined support to European Partnerships: co-programming, co-funding (incl. through procurement), institutional funding open to all types of public, private stakeholders (incl. foundations)  Market uptake:  -Market uptake considered as of FP projects’ proposal development, fostering applicants to co-create/ experiment their research and solutions with users from the outset, including within the KICs co-location centres.  -Supporting innovation actions and the demonstration of solutions of a first-of-a-kind nature in Europe with potential for replication  -Establishing pipelines of innovative solutions from R&I projects (incl. from ERC Proof of concept) targeted to public and private investors, including EIC’s Accelerator and other EU programmes  -Support to roll out and replication of innovative solutions with cross-border & transnational dimension   -Support to pre-commercial procurement and public procurement of innovation as a stand-alone tool maintained  -Support to scale-up of companies with breakthrough potential to create new markets with financial instruments under the EIC, in particular where the market does not provide viable financing  -Improved monitoring and dissemination of R&I results including through initiatives such as the dissemination and exploitation Boosters and the Innovation Radar - also directed to other DGs and programmes for further implementation. | R&I activities/projects  -Continue support R&I activities tailored to specific national/regional contexts/needs, as well as bilateral and interregional initiatives (e.g. ERDF, LIFE)  -Build R&I capacity in countries and regions (including regional and national research infrastructures): ERDF, InvestEU (infrastructure, human capital and SME windows), External Instrument, Erasmus-supported European Universities initiative, Strategic Partnerships, Knowledge Alliances and Mobility  -High-quality but unfunded proposals under the Framework Programme (SME and MSCA Seals of Excellence) should be supported through alternative funding sources, including ERDF or ESF where relevant. In the case of the SME SoE, they should benefit from similar funding conditions elsewhere, including under national/regional funding schemes.  -Pool resources for coordinated parallel actions that complement with the Framework Programme (including ERDF or ESF for the support of European Partnerships) and for R&I in specific areas (i.e. with ETS Innovation Fund)  -Align funding provisions/financial regulations between programmes.  -Provide advice on finding alternative funding sources through COSME+.  Market uptake:  -Support user-driven activities tailored to specific national/regional contexts (e.g. living labs, testbeds under the ESI funds, DEP)  -Support demonstration and innovation activities tailored to specific national/regional contexts including trans-regional activities (incl. LIFE, ESI funds)  -Take up FP results and support further development, dissemination and deployment for the benefit of economy and society (project pipelines) (all EU programmes when relevant)  -Replicate and deploy tested technologies and innovative solutions to improve the environment, energy consumption or the health of citizen or in digital technologies at local and regional level incl. trans-regional through CAP, LIFE, ERDF or ESF (e.g. for acquiring technologies, skills development) while preserving competition within the internal market  -Support the take-up of innovative solutions by individuals and final users, industry and public administration (e.g. for energy consumption, health, environment) through ESIF, LIFE, CAP, etc.  -Build enabling framework conditions for the transition processes (e.g. energy transition) such as interoperability, standards, innovation-friendly regulations, but also enhanced skills and awareness of the wider population, the spreading of best practice in research and innovation policy implementation, but also for the wider diffusion and uptake  -Support wider diffusion and uptake of (European) innovations (including through External Instrument)  -Deploy physical infrastructures allowing technological system transitions (e.g. for a transition to clean energy under CEF; financial instruments under Invest EU, ERDF)  -Reinforce cooperation between DGs for developing further the public procurement for innovative solutions in key areas of European interest, in particular for energy, transport, environment, health & ICT |

Table 4 Support to entrepreneurship, start-ups, SME growth/scale up, clusters & innovation hubs

|  |  |
| --- | --- |
| Horizon Europe | What will the other EU programmes typically cover? |
| Support to entrepreneurship & SME growth:  -Support the launch and scale-up of start-ups, innovative SMEs and mid-capital firms with breakthrough potential to create new markets with financial instruments through the European Innovation Council (pathfinder, accelerator), preserving competition within the internal market and not crowding out private investments  -Dedicated R&I thematic window and SME Window (i.e. including innovative SMEs) under InvestEU that are closely linked to the objectives of the Framework Programme  -Blended finance for innovators that is distinct from indirect financial instruments under InvestEU, but in synergy with funds and intermediaries supported by InvestEU  -Support to companies (incl. mentoring and coaching) provided within the EIT KICs, , including investments via EIC’s Accelerator   Support to clusters, hubs and broader innovation ecosystem:  -Joint programmes and other actions son to enhance innovation ecosystems  -Reinforcement of EIT KICs co-location centres (innovation hubs) for experimentation and testing with end-users  -Support to development of standards for innovative products/services in FP projects | Support to entrepreneurship & SME growth:  -Ensure full complementarity with financial instruments implemented through InvestEU windows to support scale-up of companies  -Support the growth and internationalisation of mainstream individual companies (e.g. through COSME; ERDF and External Instrument) in a competitive environment  -Support to business skills development (ESF)  Support to clusters, hubs and broader innovation ecosystem:  -Support the construction and equipment of structures for SME support (clusters, incubators, etc., notably under ERDF)  -Support to regional/national innovation ecosystem development incl. provision of advice and support services to companies (incl. through COSME+ and the Enterprise Europe Network and through the ESI funds).  -Shape R&I supportive standards in the international standardisation arena (incl through COSME) |

Table 5 Support to research infrastructures, human capital development, networking & policy-making

|  |  |
| --- | --- |
| Horizon Europe | What will the other EU programmes typically cover? |
| Research infrastructure:  -Consolidate the landscape of European research infrastructures e.g. ESFRI: support early-phase development of pan European research infrastructures, the European Open Science Cloud and European Data Infrastructures and enable delivery of High Performance Computing/data services  -Open, integrate and interconnect national research infrastructures  -Support partnerships with industry for the supply of high-tech components while ensuring a level playing field between competitors.  -Reinforce European research infrastructure policy and international cooperation  Human capital development:  -Supporting individual researchers (incl. ERC, MSCA) and R&I networks for the exchange of knowledge, incl. mobility & career development  -Continue supporting mobility & career development of researchers in ERA (e.g. Human Resources Strategy for researchers, EURAXESS, RESAVER Pension Fund, etc.)  -Continue supporting access to research infrastructures for researchers, innovators & SMEs on a transparent and non-discriminatory basis  -Continue supporting responsible research and innovation and gender equality & gender dimension in research and innovation  -Continue supporting the development of entrepreneurial skills in universities (EIT-KICs) and reinforce the role of the EIT KICs for future skills identification in areas related to global challenges  -Increase FP role in modernisation of universities in ERA, i.e. through embedding Open Science practices as well as entrepreneurship focus (e.g. skills, recognition and rewarding mechanisms, etc.)  -Continue mentoring & coaching companies to enhance innovation & entrepreneurial skills (EIC, EIT/KICs)  -Launch new Recognition prizes (Women Innovators, Capital of Innovation, EIT awards) and EIC Prizes  -Continue reinforcing human capacity in low R&I performing countries (ERA Chairs)  Networking and policy-making :  -Continuation of coordination and support actions incl. Sharing Excellence actions (Teaming, Twinning, ERA-Chairs), Policy Support Facility to help EU Member States reform their research and innovation policies and Innovation Deals to identify barriers to innovation at sectoral level  -Rationalised support to European Partnerships: co-programming, co-funding, institutional funding open to all types of stakeholders  -Improved monitoring and dissemination of R&I results towards policy  -EIC Forum of national agencies implementing national innovation policies | Research infrastructure:  -Support the national/regional contributions to the construction of pan European research infrastructures i.e. with ERDF and InvestEU Fund  -Exploit the potential of the CEF and Digital Europe Programme instruments for the large-scale coordinated procurement/ deployment of digital infrastructures and infrastructures for digital technologies  -Use External instruments for developing capacity in third countries to participate in global research infrastructures of EU interest  -Provide appropriate and continued financial support for long-lasting initiatives beyond FP funding life-time  Human capital development:  -Support to skills development (technical, digital and transversal) to support the use of innovative solutions, while increasing employability and career prospects, but also  entrepreneurial skills through the future COSME (Erasmus for Young Entrepreneurs) and ESF  -Build/reinforce human R&I capacity in countries & regions (including through regional & national research infrastructures & fellowships): European Social Fund (incl. basic digital skills), InvestEU (research infrastructure, human capital & SME windows); Erasmus (targeting particular sectors to provide a pipeline of talented pre-graduates that can embark on a research career, European Universities initiative, Strategic Partnerships individual mobility for studies and for traineeships); External Instrument  -Develop skills and capacities towards gender equality and Responsible Research and Innovation  -Foster links and synergies between relevant policy actions linking education/research/innovation  Networking and policy-making :  -Ensure strong coordination between programmes, especially in the area of research infrastructures, innovation hubs, large demonstrators etc.  -Continue support R&I networking activities tailored to specific national/regional contexts and inter-regional cooperation  -Build R&I policy capacity in countries and regions e.g. by developing networks across the quadruple helix to input policy evidence  -Support through CAP and ERDF to upgrade national and regional ecosystems and make them more innovation-conducive (incl. through Smart Specialisation Strategies)  -External Instrument actions to help improve framework conditions for innovation and for cooperation in R&I |

3Synergies with the European Regional Development Fund (ERDF) 

Table 6 European Regional Development Fund- Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  -Under development  Target beneficiaries:  -All of the Framework Programme's beneficiaries may also get ERDF support either for different types of projects or within a common project  Geographical coverage:  Member States and regions | R&I activities/projects  -Supports R&I projects of individual enterprises, and public institutions, cooperation university-business and university researchers  Market uptake:  -Focusses funding for R&I on the take-up of technology and knowledge  -Social innovation and co-creation, use of design-thinking and other newer forms of innovation  -Supports all types of market take-up, prototyping, IPR management advice, etc. (within State-Aid limits!)  -Funds replication and diffusion of innovative solutions and technology deployment, including the actual public and private procurement of innovative solutions  -Open to PCP and PPI funding (both preparation of Terms of Reference and actual procurement), offers technical assistance and training for national and regional authorities; networking among different countries  -Supports interregional partnerships along value chains for joint investment pipelines, with the aim for industrial transition |
| Support to entrepreneurship & SME growth:  -Financial instruments under ERDF  -Funds the provision of advice and support services  Support to clusters, hubs and broader innovation ecosystem:  -Funds the construction and equipment of infrastructures for SME support (clusters, incubators, etc.)  -Funds the innovation ecosystem development | R&I Infrastructure:  If in line with the relevant smart specialisation strategy, ERDF may pay for:  -The construction and upgrade of research infrastructures (this may include some training “on the job” to correctly use new infrastructures and equipment)  -The construction and upgrade of innovation infrastructures (pilot lines, living labs, demonstrators, tech transfer offices)  Human capital development:  -Funds the purchase of equipment and infrastructures needed for human capital development, if relevant for the implementation of the smart specialisation priorities.  Networking and policy-making:  -Supports the development and improvement of national & regional innovation eco-systems including business-industry-citizens-public support bodies’ cooperation, innovation governance, capacity-building and the cooperation with other regions & Member-States for mutual learning & joint investment pipelines  -Invests in networking with other countries & regions bringing together the policy-makers & funding agencies/authorities/stakeholders on the ground  -Invests in better innovation policy-making for industrial modernization (Smart Specialisation)  -Invests in better innovation governance (entrepreneurial discovery process) |

The Regional Development Funds aim at strengthening the EU's economic, social and territorial cohesion. They have a prominent role in developing, improving and connecting national and regional innovation ecosystems, and are expected to continue to dedicate important amounts in the post-2020 period to research and innovation ecosystem investments, i.e. in research or innovation infrastructures, SME innovation capacities, networking, innovation support services and human capital. Support to innovation is provided through smart specialisation strategies which prioritise public research and innovation investments through a bottom-up approach for the economic transformation of regions, developing innovation ecosystems, building on regional competitive advantages and facilitating market opportunities in new inter-regional and European value chains. Smart specialisation provides a strategic framework to support 'upstream actions' to prepare stakeholders to participate in the Framework Programme, and 'downstream actions' to exploit and diffuse research and innovation results, developed under the Framework Programme.

Horizon Europe will continue to support and build capacity of low-performing countries in research and innovation, in the context of strengthening the European Research Area and reforms to the research and innovation systems. The complementarity between the Framework Programme's support and ERDF support to the national and regional innovation systems will be ensured. For instance, the Teaming mechanism will still require compliance with the relevant Smart Specialisation strategy.

The scaling-up and transferability of projects and the communication and sharing of practices constitute two key areas of improvement for the future. Establishing a more structured cooperation across the Commission would pool efforts and streamline various initiatives. In this regard, transnational cooperation activities and innovative national actions will be further supported with a view to promote social innovation in the implementation of the European Pillar of Social Rights.

Arrangements for synergies between Horizon Europe and ERDF or ESF or national contributions for similar type of projects will be further enhanced benefiting from more conductive rules. Legal provisions allowing cumulative funding of grants from the Framework Programme and ERDF/ESF for the same action (provided that there is no double funding) will be kept allowing a pro rata basis approach. Programme co-fund actions will be designed to facilitate such funding synergies and simplified rules. Similarly, funding of Seal of Excellence awards from national ERDF or ESF allocations will be simplified and facilitated. Moreover, the take-up in Horizon Europe of simplified cost options for reimbursing expenditure (lump sums, flat rates, unit costs) will further facilitate the combination of funds. To accomplish the enhanced synergies and simplification mentioned above, all relevant rules and regulations will be revised accordingly in time for Horizon Europe, provided certain conditions are fulfilled.

High-quality-but-unfunded proposals under the Framework Programme (Seals of Excellence awarded under SME actions or the Marie Skłodowska-Curie Actions, MSCA) will be able to benefit from the same co-funding rates elsewhere, including under regional funding schemes. For example, this means that ERDF or ESF allocations can be used to support Seal of Excellence projects, where relevant to the local context and smart specialisation strategy.

Portfolios of R&I results and innovations attained by projects funded under the Framework Programme that correspond to existing national or regional needs will be made available to national or regional ERDF and ESF managing authorities in a consistent and organised manner. The role of advisory services and their access to available innovations, knowledge and results stemming from the Framework Programme will be given particular attention. More specifically, the ERDF may feature increased funds dedicated to the take-up of results and the rolling out of novel technologies and innovative solutions from past Framework Programmes and Horizon Europe.

Box 1 Concrete examples of how synergies with ERDF and ESF could look like in practice

|  |
| --- |
| ·Horizon Europe projects can be implemented using the equipment and research infrastructures previously funded from the ERDF.  ·SME who have received a Seal of Excellence (SoE) can apply for alternative funding under conditions to be further defined under relevant rules and regulations, including GBER with regard to State-aid compatibility. That allows for reducing administrative burden and costs on the SME and funding body side.  ·Researchers who received the MSCA SoE under the Framework Programme can be supported through alternative sources of funding at regional or national level, including through use of ESF. This allows countries/institutions to identify and employ excellent researchers, while removing/reducing the need to carry out a new evaluation of the proposals. |

4Synergies with the European Social Fund (ESF+)

Table 6 European Social Fund + - Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  -Not sector-specific  Target beneficiaries:  -No groups are excluded  Geographic coverage:  -EU | R&I activities/projects  -Future ESF to continue promoting social innovation (i.e. policy testing and experimentation in the social & employment policy fields) |
| Support to entrepreneurship & SME growth:  -ESF programme:  -access to finance (microcredit and microloans)for vulnerable groups and micro-enterprises; continued support for youth, social entrepreneurship | R&I Infrastructure:  -Complements other EU instruments for investments in R&I infrastructure  Human capital development:  -Aims to improve the quality, efficiency and openness of (tertiary) education e.g. developing new teaching methods, delivering high quality educational content, which is relevant to labour market needs  -Stimulates partnerships between higher education, business and research organisations  -Aims to strengthen human capital in R&I, e.g. through training and capacity building for researchers (e.g. complementarities and synergies with MSCA Seal of Excellence and MSCA co-funded doctoral and postdoctoral research training programmes) and for teachers; opening tertiary education access to disadvantaged groups  -Can mainstream curricula oriented towards equipping students with the skills needed in the future labour market developed under the Framework Programme.  Networking and policy making:  -ESF support for reforms of education systems, curricula |

The European Social Fund (ESF) is instrumental in supporting continuous investments in skills which are key for harnessing technological development. Skills are a crucial element for developing environments conducive to innovation, including in the European Research Area. The ESF+ will mainstream and scale up Framework Programme-funded innovative curricula that will equip people with the skills and competencies needed for the jobs of the future (based on forecasting of future professions).

Across the EU funds, the ESF represents the major bulk of funding for social transformation mainstreaming social innovation in the economy and reinforcing human capital, including for research and innovation.

The deployment and support of ESF to Framework Programme-funded skills and competencies curricula can take several approaches (i.e. integration of Framework Programme-funded curricula in national or regional programmes; transnational cooperation networks on skills). This will translate for example through synergies and complementarities between ESF and the Framework Programme-MSCA co-funded doctoral and postdoctoral research training programmes. MSCA proposals with the Seal of Excellence may be funded by the ESF+ to support activities promoting human capital development in research and innovation and to attract talents, in aiming to strengthen the European Research Area.

Box 2 Concrete examples of how synergies with ESF could look like in practice

|  |
| --- |
| ·Framework Programme-MSCA researchers can use previously ERDF funded equipment and infrastructures for the trainings and ESF can financially support innovative training activities as well as other capacity-building measures (e.g. networking activities, mobility allowance). |

5Synergies with the EU programmes for agricultural and maritime policy

Table 7Error! No sequence specified. European Agricultural Guarantee Fund; European Agricultural Fund for Rural Development; European Maritime & Fisheries Fund - Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  -Agriculture  Target beneficiaries:  -Farmers  -Policy makers  -Bio-industries  -SMEs  Geographical coverage:  -EU | R&I activities/projects:  -Support to R&I in Member States’ CAP Strategic Plans  -Knowledge exchange and innovation actrivities within Agricultural Knowledge and Innovation System (AKIS)  -Innovation projects (operational groups) with EIP-AGRI (European Innovation Partnership)  -Bottom-up innovation projects (operational groups)  Market uptake:  -Investments projects  -EIP-AGRI |
| Human capital development:  -AKIS (European Agricultural Knowledge and Information Systems) /EIP-AGRI  -Conditionality in coming CAP plans  Networking and policy making:  -CAP network  -European Innovation Partnership network |  |

Research and innovation are set to play a stronger role in the future agricultural and maritime policy as part of a key priority to foster innovation, in particular through the wider diffusion of innovation and better access to new technologies and investment support.

Through the Framework Programme's strategic planning processes, coherent approaches with these policies will be ensured. In particular they will work in tandem to promote Food and Nutrition Security and the Sustainable Management of Natural Resources as a strong component under the Framework Programme and the modernised CAP. This commitment is reflected in developing an ambitious, integrated Strategic Research and Innovation Agenda (building on the Strategic Approach to EU Agricultural R&I, Food 2030, and the Bioeconomy Strategy) as an important input into the shaping of Horizon Europe and for serving the evolving innovation needs of the CAP.

The development of the Strategic Research and Innovation Agenda Plan will inform priorities of the Framework Programme in the area of food and natural resources whereas the uptake of research and innovation results into a modernised CAP will be promoted. This will build on the work undertaken to date through the European Innovation Partnership on Agricultural Productivity and Sustainability (EIP-AGRI)
[105](#footnote106)
 in mobilising the agricultural sector for innovation, funding multi-actor pilot projects and making new knowledge available. The ambition is to bring about systemic knowledge generation and CAP support that is generated upstream, thus leading to the downstream uptake and deployment of innovations by end users within projects. This will enable the CAP to make best use of research and innovation results and to promote the use, implementation and deployment of innovative solutions, including those stemming from projects funded by the Framework Programmes and from the European Innovation Partnership.

Box 3 Concrete example of how synergies could look like in practice

|  |
| --- |
| The implementation phase will ensure greater uptake of Framework Programme results in CAP programmes, e.g. by:  ·Reinforcing the role of Agricultural Knowledge and Innovation systems (AKIS) in Member States and improve the connections between national AKIS at various levels (regional, national, EU levels). The role of advisory services and their access to research outcomes will be given particular attention.  ·Increasing the impact of CAP instruments to foster demonstration, investments or new business models in farming and rural areas. Examples provided under CAP instruments could address innovations in digitisation, precision farming and the bioeconomy. |

6Synergies with the Single Market Programme

Table 7 Single Market Programme - Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  -SMEs across sectors  -Focus on SME in strategic value chains  Target beneficiaries:  -SME intermediaries  -Cluster organisations  -Technology clusters  -Specialised SME support actors  Geographical coverage:  -EU | Market uptake:  -Support SME’s uptake of innovation through Joint Cluster Initiatives & Scaling-up Instrument  -Facilitates SME’s access to markets, including through public procurement |
| Support to entrepreneurship & SME growth:  -Upgraded Enterprise Europe Network: specialised business advisory services, e.g. scale-up advice for entrepreneurs with a proven business model  -Erasmus for Young Entrepreneurs: mentoring; initial business matchmaking  -New Scaling-up Instrument: For SMEs & strategic value chains channelled by Joint Cluster Initiatives; supports SME scale-up across regional, sectoral & technological boundaries to access global industrial value chains  -Delimitation New Scaling-up Instrument/ EIC accelerator: focus on growth drivers beyond innovation (e.g. internationalisation, skills); specialised mainstream SMEs (#only breakthrough innovators in EIC)  Support to clusters, hubs and broader innovation ecosystem:  -Joint Cluster Initiatives: foster strategic interregional collaboration among specialised clusters and eco-systems to strengthen EU value chains (10-20 major EU value chains) | Human capital development:  -Integrated business support, incl. skills development and mentoring in “Erasmus for young entrepreneurs”  Networking and policy-making:  -Strategic Cluster Initiatives: strategically connect ecosystems and clusters  -Enterprise Europe Network (innovation ecosystem integrator & corporate tool)  -SME Panels and SME Feedback tools for policy making through the EEN |

The Single Market Programme - which integrates the COSME programme - addresses the market failures, which affect mainstream SMEs, and will promote entrepreneurship and the creation and growth of companies. Thus it will focus on generating growth opportunities for mainstream enterprises. Under Horizon Europe, the European Innovation Council will support, in a complementary way, the scale-up of innovative start-ups, SMEs and mid-cap firms with market-creating innovation potential; in particular where the market does not provide viable financing.

Horizon Europe will remain the one-stop-shop for EU innovation policy support, as well as measures stimulating innovation uptake that are already embedded in dissemination and exploitation strategies of actions supported under Horizon 2020. Full complementarity will be ensured between the COSME scaling-up instrument for mainstream companies deployed through InvestEU and the actions of the future European Innovation Council for innovative companies, as well as in the area of support services for SMEs, in particular where the market does not provide viable financing.

For the dissemination of both future programmes (Horizon Europe and the Single Market Programme) the Enterprise Europe Network (EEN) may play, as other existing SME support structures, a complementary role to dedicated support structures put in place for the Horizon Europe, such as National Contact Points (NCPs). The future mandate of Enterprise Europe Network and the Horizon Europe support structures (e.g. NCPs, Innovation Agencies) will be defined to avoid duplication, with the aim of maximising benefits to SMEs.

The skills and knowledge available in existing networks including EEN may be used for enhanced existing services, like for example coaching activities under the EIC beneficiaries. These include investment readiness development, linking with private investors, business partners and customers through brokerage activities and events including trade fairs. The networks may also be used for the testing of new initiatives with regards to support delivery to SMEs via specific actions.

7Synergies with the InvestEU Fund

Table 8 InvestEU Fund - Research and innovation related support

|  |  |
| --- | --- |
| The InvestEU Fund will integrate current EU-level financial instruments and budgetary guarantees under a single mechanism and in particular deploy indirect financial instruments provided for under Horizon Europe and other EU programmes.  Sectors/Domains:  -R&I Window  -SME Window including innovative companies  -Sustainable infrastructure window  -Social, skills and human capital window  Target beneficiaries:  -Financially viable projects or commercial entities facing market gaps or sub-optimal investment situations  Geographical coverage:  -EU | R&I activities/projects  -The R&I window and products for innovative companies developed under the SME Window, will provide a range of debt and equity financing products in line with the variety of potential final beneficiaries at different development stages and in different EU policy areas.  Market uptake:  -The R&I window will support high-risk investments in R&I and new technologies, including in large-scale first-of-a-kind demonstrations for which market investor interest may be low.  -The R&I window will de-risk investments in innovative technologies and, together with the SME window, transfer established solutions to new markets.  -Products for innovative companies developed under the SME Window will boost SME investment capacity. |
| Support to entrepreneurship & SME growth:  -The SME window will improve access to finance by supporting SME financing, including and in particular for innovative companies. It will further support start-ups and companies commercialising R&I results.  -The R&I window and SME Window will provide a range of financing products to support growth of companies, including and in particular innovative ones.  -The Social, skills and human capital window will promote inclusive entrepreneurship, improve access to employment (including self-employment), job creation, labour market integration, social inclusion by increasing the availability of and access to micro-finance [106](#footnote107) , and access to finance for social enterprises. | R&I Infrastructure:  -The R&I Window will facilitate access to finance through debt and equity instruments to research infrastructures. It would support in particular those that are financially viable and investment ready.  Human capital development:  -Social and human capital window: support to investment in all levels of education and (necessary for building a knowledge-based society), support to increase vocational training and lifelong learning, including non-formal learning investment in human capital.  Networking and policy making:  -The InvestEU Fund will provide project development assistance to support the development of a robust pipeline of investment projects. It could also be used to facilitate blending opportunities with grants schemes. |

Financial instruments for research and innovation and innovative companies, including SMEs, supported under Horizon Europe or other EU programmes will be deployed through InvestEU. InvestEU will feature a dedicated R&I window as well as a dedicated SME window that will also target innovative companies, possibly through a sub-window. Investment efforts under InvestEU will complement investment and support efforts under Horizon Europe (including by supporting high-risk investments in research and innovation and new technologies) in a manner that does not crowd out private investments.

Additionally, Horizon Europe will provide blended finance for innovators in a way that is distinct from indirect financial instruments under InvestEU, in case of a very high level of risk where no intervention from InvestEU would be possible (yet). Blended finance shall be implemented in tandem with financial intermediaries supported by InvestEU, in order to ensure investment continuity where appropriate and necessary.

Box 4 Concrete example of how synergies could look like in practice

|  |
| --- |
| A radically innovative SME with scale-up potential that is supported under the Accelerator scheme of Horizon Europe's European Innovation Council and hence is benefiting from a mix of finance and other types of support in order to deliver on a particular innovation – which implies that the latter becomes fully market-mature and investment-ready – can be introduced to the different schemes under the SME window of InvestEU, in order to allow it to find additional finance – where appropriate and necessary – in view of supporting further company development and scale-up. The idea is that the Accelerator will de-risk the innovation project driven by the SME to a point that it becomes an attractive investment target for financial intermediaries implementing SME products under InvestEU. |

8Synergies with the Connecting Europe Facility

Table 9 Connecting Europe Facility – Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  -Energy  -Transport  -Digital  Target beneficiaries:  -Public authorities  -Industry: infrastructure building/ manufacturing, Infrastructure managers, transport operators  -Consultants for studies  Geographical coverage:  CEF-transport divided into 2 ‘envelopes’:  -General envelope: for all Member States  -Cohesion Fund envelope: for Cohesion Member States | R&I related activities/projects:  -Transport, energy, telecom: Support to deployment of new technologies & innovation, as per TEN-T guidelines Art.33  -Real-life pilots (studies/works)  -Deployment of existing innovations  Market uptake:  -CEF supports pilots, prototypes for certain technologies developed under the Framework Programme or relevant for transport infrastructure  -CEF funds transnational infrastructures to strengthen Energy Union and accelerate energy transition: research and innovation state-of-the-art should be considered in CEF (particularly regarding digital applications, electric charging and alternative fuels).  -CEF transport supports the development of the SESAR Joint Undertaking solutions through the SESAR deployment managers: technology deployment; |
| Support to entrepreneurship & SME growth:  -Grants and public procurement | R&I Infrastructure:  -Not R&I infrastructures but efficient and interconnected networks + main infrastructure components  -Smart infrastructure for sustainable mobility (digital, alternative fuels, multimodality, innovation)  -Safer, secure, resilient and accessible infrastructure (i.e. climate resilience)  Networking and policy making:  -Support to policy making: alternative fuels, ITS, Urban, etc. policies |

The future CEF will prioritise the large-scale roll-out and deployment of existing and proven/demonstrated innovative new technologies and solutions which result from Framework Programmes in transport, energy and mobility, in particular through the Climate, Energy and Mobility cluster as well as digital technologies. Research and innovation needs in the areas of transport, energy and the digital sector within the EU will be identified and established during the Horizon Europe strategic planning process.

Strategic synergies will be pursued through making the two programmes’ contributions to EU policy more explicit and clearer, while deployment of state-of-the-art technology will be pushed within targeted areas – for example electro-mobility
[107](#footnote108)
. The exchange of information and data between the Framework Programme and CEF projects will be facilitated in particular by highlighting technologies arising from Framework Programme projects with a high market readiness that could be deployed through CEF.

The blending of funds and instruments for common objectives, for example public procurement, will be explored. In view of the investment challenges in the three CEF focus areas, and the transformational character of most of the CEF projects, public procurement for innovation could be used to facilitate and de-risk the take-up of such technologies in the networks sector. This could also enable system operators to invest substantially higher volumes than they (both through their balance sheets and their regulated asset bases) are used to.

Box 5 Concrete example of how synergies could look like in practice

|  |
| --- |
| Research and development on low-emission vehicles will be supported by the Framework Programme, while re-charging infrastructure / alternative re-fuelling stations will be deployed under CEF. |

9Synergies with the Digital Europe Programme

Table 10 Digital Europe Programme - Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  Digital technologies for :  -High Performance Computing (HPC)  -Cybersecurity  -Artificial Intelligence  -Advanced digital skills  -Areas of public interest and industry  Target beneficiaries:  -Public authorities and administrations  -Industry including SMEs  Geographical coverage:  -EU wide | Market uptake:  -Support to transformation of areas of public interest and industry  -Wide deployment of digital technologies  -Large-scale deployment projects making best use of digital capacities and latest technologies such as High Performance Computing and Artificial Intelligence in areas of public interest |
| Support to entrepreneurship & SME growth:  -Through Digital innovation hubs and networking of competence centres  Support to clusters, hubs and broader innovation ecosystem:  -Support to Digital Innovation Hubs and networking of digital facilities | R&I Infrastructure:  -Co-investment in digital capacities (through joint procurement)  -Promotion of interoperability and standardisation  Human capital development:  -Support to advanced digital skills in HPC and Big Data, Cybersecurity and Artificial Intelligence |

The Digital Europe initiative is a new initiative dedicated to enlarging and maximising the benefits of digital transformation to all European citizens and businesses. Both Horizon Europe and the Digital Europe Programme (DEP) will provide public support in the field of digital technologies. Under Horizon Europe, a dedicated budget will be allocated to a cluster "Digital and industry". In addition, digital technologies will, because of their cross-cutting nature, also be developed in a wide range of other (thematic) parts of the programme.

While several thematic areas addressed by Horizon Europe and Digital Europe coincide (e.g. both will cover High Performance Computing, Artificial Intelligence, Cybersecurity), the type of actions to be supported, their expected outputs and their intervention logic are different and complementary. Digital Europe will focus on large-scale digital capacity and infrastructure building. These capacities and infrastructures will support the wide uptake and deployment across Europe of critical existing or tested innovative digital solutions. This will mainly be implemented through coordinated and strategic investments with Member States, notably through joint public procurement, in digital capacities to be shared across Europe and in EU-wide actions that support interoperability and standardisation as part of developing a Digital Single Market.

Research and innovation needs related to digital aspects will be identified and established as part of the strategic planning process of Horizon Europe; this includes research and innovation for High Performance Computing, Artificial Intelligence, Cybersecurity, combining digital with other enabling technologies and non-technological innovations; support for the scale-up of companies introducing breakthrough innovations, including based on digital technologies; the integration of digital across all the Global Challenges pillar; and the support to e-Infrastructures.

Digital Europe capacities and infrastructures will be made available to the research and innovation community, including for activities supported through Horizon Europe including testing, experimentation and demonstration across all sectors and disciplines. As the development of novel digital technologies matures through Horizon Europe, these will progressively be taken up and deployed by Digital Europe. Horizon Europe initiatives for the development of skills and competencies curricula, including those delivered at the co-location centres of the European Institute of Innovation and Technology's Digital KIC (EIT Digital), are complemented by Digital Europe-supported capacity-building in advanced digital skills.

To ensure strong coordination mechanisms for programming and implementation the strategic programming and operating procedures for both programmes are aligned, inter alia using the services provided by the Horizon Europe Common Support Centre. Their governance structures involve the respective Commission services as well as others concerned by the different parts of the respective programmes.

Figure 15 Complementarities between Horizon Europe and Digital Europe at the strategic level

|  |  |
| --- | --- |
| Horizon Europe | Digital Europe |
| Development of technological and non-technological solutions, including digital content | Large scale deployment of digital capacity and existing digital technologies in areas of public interest or market failure |
| Research, technological development, demonstration, piloting, proof-of-concept, testing and innovation including precommercial deployment | Capacity and infrastructure building on HPC, AI, Cybersecurity and advanced digital skills |
| Research and innovation on digital technologies | Making the best use of digital capacities in areas such as health, public administration, justice and education |
| Selection through EU level competition and support for cross-border collaboration | Large-scale deployment of digital capacities, infrastructures and solutions within Member States as part of an overall EU strategy or policy |
| EU-level calls for proposals: grants, public procurement, financial instruments and budgetary guarantees (\*). | An important part will be strategic co-investment with Member States through public procurement. Funding also to be provided through procurement grants, financial instruments and budgetary guarantees(\*). |
| Networking at EU level of research & innovation actors | Promotion of interoperability of digitised public services |
| Support to cross-border access to and integration of research infrastructures | Construction, maintenance, upgrade and use of digital capacities and infrastructures in computing, AI and cybersecurity. |
| Development of skills and competencies curricula | Support for capacity building on advanced digital skills |
| Supporting EU-wide research databases | Building of shared digital capacities including "common data spaces" of public sector data and other publicly available data |

(\*) To be implemented under the InvestEU Fund.

Complementarities in specific thematic priorities Digital Europe / Horizon Europe

High Performance Computing (HPC)

=> Digital Europe will focus on co-investment (through joint procurement with Member States) in the latest supercomputers, the networking of supercomputing facilities and the use of these in areas of public interest, e.g. health, public administration, climate, etc. Supercomputing capacity will be also available to the scientific community and industry, notably SMEs. The budget will be used: (i) to procure together with Member States two top-range exascale super computers by 2022-23; (ii) to provide an EU coordinated framework for MS wishing to upgrade and share their mid-range supercomputing facilities across Europe; (iii) to facilitate the networking and use of the supercomputing facilities.

=> Horizon Europe will support research and innovation underpinned by HPC infrastructures and facilities, including testing, experimentation and demonstration across all sectors and disciplines. On HPC specifically, Horizon Europe funding will cover research and innovation for next generation computing paradigms, architectures and programming environments, like cognitive computing, neuromorphic systems, multi-purpose quantum computing and codes for post-exascale performance. It will explore features like extreme low-power and large-scale distributed data processing.

Cybersecurity

=> The DEP will focus on:

·Investments in advanced cybersecurity equipment and infrastructures that are essential to protect critical infrastructures and the DSM at large. This could include investments in quantum facilities for cybersecurity (e.g. Quantum key distribution and facilities for post quantum cryptography) and other tools to be made available to public and private sector across Europe.

·Scaling up existing technological capacities in the Competence Centres in Member States and ensuring wide deployment of the latest cybersecurity solutions across the economy;  

·Networking of Cybersecurity Competence Centres in the Member States with leading technology capacity able to support the digital economy. This should also include aligning and enhancing  cybersecurity skills;

=> Horizon Europe will provide support for research and innovation underpinned by cybersecurity infrastructures and facilities, including testing, experimentation and demonstration across all sectors and disciplines impacted by cybersecurity. In addition Horizon Europe will support research and innovation on cyber-secure components and software relevant for areas such as protection of infrastructure or privacy and data protection. These novel approaches include, e.g. new paradigms for safety- and security-by-design, for cryptography, for self-healing systems and for cyberattack monitoring and rebuttal.

Artificial Intelligence (AI)

=> Digital Europe will focus on common capacity building to ensure the wide deployment of AI in Europe including, e.g. (i) the provision of an "AI on demand" based on open source software, algorithms, tools and equipment, and on a "common data space" containing public sector data and other publicly available data. The platform will be made available widely across Europe (notably through the Digital Innovation Hubs, see below) to actors in all sectors; (ii) the set up and reinforcement of the network of Digital Innovation Hubs to cover all regions in Europe with AI expertise and facilities. Support will go both, to the reinforcement of existing competence centres (at the core of the Digital Innovation Hubs) and to building up of new ones where needed.

=> Horizon Europe will support for research and innovation underpinned by AI infrastructures and facilities, including testing, experimentation and demonstration across all sectors and disciplines that are influenced by Artificial Intelligence. Horizon Europe will also support research and innovation in advanced AI technologies including explainable AI, unsupervised machine learning and data efficiency. Horizon Europe will support the networking and EU-wide access to specialised innovation hubs and innovation infrastructures for research and innovation performing activities.

Digitisation of areas of public interest and of industry

=> Digital Europe will support the Europe-wide transformation of areas of public interest and of industry. This will be done through co-investment with Member States and, where relevant, the private sector in leadership deployment projects making the best use of digital capacities and latest digital technologies in areas of public interest or market failure. The added value of Digital Europe will be in ensuring interoperability of solutions, suitable regulatory frameworks and standards across the EU, as well as higher impact through EU-wide actions avoiding digital divide and fragmentation, and with significant economies of scale. An important component of Digital Europe will be the access to and availability of advanced digital skills. This action will complement the training activities performed in the KIC-Digital of the EIT under Horizon Europe.

=> Under Horizon Europe a dedicated budget will be allocated to support research and innovation dedicated to “digital and industry” and digital aspects will be behind almost every research, including health, transport, environment, energy, etc.

10Synergies with the Programme for Environment & Climate Action (LIFE) 

Table 11 LIFE - Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  -Better integration of environmental legislation: Natura 2000 areas  -Waste, water, air pollution plans  -Projects with direct environmental impact  -Climate mitigation measures  -Climate adaptation measures  Target beneficiaries:  -Cities, NGO, administrations, entreprises  Geographical coverage:  -EU | Market uptake:  -”Standard action projects” best-practice or demonstration projects (public, private, university) for new measures or approaches at Member State/regional level with significant environmental or climate impact  -“Strategic integrated projects’ mobilising and ensuring the effective contribution of other EU, national/regional/private funds to the implementation of key measures as per the environmental and climate plans (e.g. river basin management plans, clean air plans, adaptation strategies or climate and energy plans)  -Not directly supporting PCP/PPI but regions could use the Strategic Integrated projects to that end  -Capacity building, policy implementation and support for large-scale deployment of innovative solutions for clean energy transition (energy efficiency, renewable energy) |
| Support to entrepreneurship & SME growth:  -Financial instruments as part of Invest EU | Networking and policy making:  -Not addressing R&I actors but enterprises, cities, NGO, administrations |

The future LIFE programme will continue to act as a catalyst for implementing EU environment, climate and energy policy and legislation, including by taking up and applying research and innovation results from the Framework Programme. The future LIFE programme will, firstly, strengthen its role as a catalyst for the implementation of EU legislation and policies, for instance through strategic integrated projects. Secondly, its complementarity with other EU programmes will be reinforced where the market does not provide viable financing.

LIFE synergies with Horizon Europe will ensure that research and innovation needs to tackle environmental, climate and energy challenges within the EU are identified and established during Horizon Europe's strategic research and innovation planning process. LIFE will continue to act as a catalyst for implementing EU environment, climate and energy policy and legislation, including by taking up and applying research and innovation results from Horizon Europe and help deploying them at national and (inter-)regional scale where it can help address environmental, climate or clean energy transition issues. They can subsequently be deployed at large scale, funded by other sources, including Horizon Europe. In particular LIFE will continue to incentivise synergies with Horizon Europe through the award of a bonus during the evaluation for proposals which feature the uptake of results from Horizon Europe. Horizon Europe's European Innovation Council can provide support to scale up and commercialise new breakthrough ideas that may result from the implementation of LIFE projects.

Through strategic programming there is also potential for LIFE to highlight the areas where it sees a research and innovation need. LIFE will continue to incentivise synergies with the Framework Programme through the award of a bonus during the evaluation for proposals that feature the uptake of Framework Programme results.

The integration of Clean Energy Transition sub-programme in LIFE will continue the actions funded under Intelligent Energy Europe III/Horizon 2020-Societal Challenge III. It will focus on capacity building and policy support activities, while the Framework Programme will continue focusing on technology and non-technology related research and innovation for clean energy transition.

LIFE projects will also find further ways to gain support in helping them scale up and commercialise their ideas. This will occur via channelling relevant successful LIFE projects into the European Innovation Council mechanism. This would be relevant for those innovators having benefitted from the LIFE programme for their projects having demonstrated direct environmental impact at the regional or national scale, which also have a high growth potential and ambition to accelerate the transition to a low-carbon, energy efficient and circular economy through sustainable innovation.

11Synergies with Erasmus

Table 12 Erasmus - Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  -Education, Training, Youth /Higher Education, Vocational Education and Training, Adult Learning  Target beneficiaries:  -Students (researchers and young entrepreneurs)  -Teachers, Researchers and other Higher Education Staff  -Higher Education Institutions  -Policy Makers & Higher Education stakeholders  Geographical coverage:  EU and international | R&I activities/projects  -European Universities initiative:  osupport the development of new, joint and integrated, long term and sustainable strategies on education, research and innovation based on trans-disciplinary and cross-sectoral approaches to make the knowledge triangle a reality, providing impetus to economic growth;  ofoster the emergence of multidisciplinary and multilingual environments where students, lecturers, researchers and other public and private actors co-create and co-share knowledge and innovation, working together to address global societal challenges (for example: they could focus on SDGs or priorities of the Framework Programme).  -Further roll out of Higher Education for Smart Specialisation to advice public authorities to involve higher education institutions and to align their educational offer to the needs identified in smart specialisation strategies  Market uptake:  -Strategic Partnerships and Knowledge Alliances for the small-scale testing of research outcomes |
| Support to entrepreneurship & SME growth:  - Support for Innovation Partnerships through Knowledge Alliances  - Expanded use of HEInnnovate tool in making innovation and entrepreneurship a core part of overall institutional strategy  - Step-up support for University-Business Cooperation and Establishment of regional and national University-Business fora | R&I Infrastructure:  -Create a Europe-wide platform for digital higher education  Human capital development:  -European Universities initiative – educating students and researchers to be critical and reflective thinkers with solution-oriented analytical skills and ethical and intercultural awareness  -Erasmus research internships and Strategic Partnerships will encourage undergraduates and Masters students to be involved in research projects and develop their research and critical thinking skills   Networking and policy making:  -Ensure dissemination of results from Policy Experimentation projects to common stakeholders and explore synergies between Erasmus-supported Peer Learning and Peer Counselling on funding of higher education and Research and Innovation supported Peer Review |

Europe's high-level skills needs are addressed by both Horizon Europe and Erasmus through investments in the development of competences, inter-disciplinary, transferable and entrepreneurial skills in forward-looking fields or disciplines that are strategic for smart economic and social development (such as science, technology, engineering and mathematics, climate change, clean energy, artificial intelligence, robotics, data analysis, design, etc.). More specifically, Erasmus will continue to support mobility, cooperation and policy initiatives in the field of higher education, whereas Horizon Europe continues supporting the improvement of skills within funded projects and provides incentives for universities embracing open science.

Both programmes foster the integration of education and research through facilitating higher education institutions to formulate and set up common education, research and innovation strategies, to inform teaching with the latest findings and practices of research to offer active research experience to all students and higher education staff and in particular researchers, and to support other activities that integrate higher education, research and innovation.

Horizon Europe will complement the Erasmus programme's support for the European Universities initiative, in particular its research dimension, as part of developing new, joint and integrated long-term and sustainable strategies on education, research and innovation based on trans-disciplinary and cross-sectoral approaches to make the knowledge triangle a reality. This will provide impetus to economic growth.

At the level of postgraduate training, the Marie Skłodowska-Curie Actions (MSCA) under Horizon Europe will further strengthen the provision of transferable skills for researchers, including by transferring research results into teaching. The participation to MSCA projects' activities, in particular network-wide training, where relevant, of Erasmus students or staff and vice versa, will concretise synergies between research and education programmes.

Erasmus European Universities, Strategic Partnerships, Knowledge Alliances or Erasmus Mundus Joint Masters Degrees will support forward-looking skills and new curricula aligned with the objectives of the future EIT KICs and Horizon Europe’ Missions to create specific synergies. Encouraging undergraduates and Masters students to be involved in research and innovation projects and develop their research and critical thinking skills will continue to be a higher education priority supported through research internships and Strategic Partnerships under the future Erasmus programme.

The European Universities initiative will be a catalyst for human capital development, education, research and innovation activities and projects. The alliances will seek to address the big societal challenges and skills shortages that Europe faces, underpinned by higher education institutions which can seamlessly cooperate across borders. This will progressively increase the international competitiveness of European higher education institutions by:

·fostering development of new, joint and integrated, long term and sustainable strategies on education, research and innovation based on trans-disciplinary and cross-sectoral approaches to make the knowledge triangle a reality;

·driving educational and research innovation by making use of the most innovative teaching methods and digital technologies;

·creating new joint curricula based on forward looking skills and multidisciplinary approaches;

·attracting the best students, teachers and researchers across the world and acting as role models and mentors for other higher education institutions throughout Europe;

·fostering opportunities for students, teachers, researchers and other public and private actors to co-create knowledge and innovation together (e.g. working together to address global societal challenges, Sustainable Development Goals or priorities identified by the Framework Programme).

Box 6 Concrete example of how synergies could look like in practice

|  |
| --- |
| The Erasmus students could take part in the EIT/KICs courses and vice versa where the Erasmus activities will be easier to access for the beneficiaries of the Framework Programme. |

12Synergies with the Neighbourhood, Development and International Cooperation Instrument

Table 13 EU Neighbourhood, Development and International Cooperation Instrument - Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  -Cross-cutting sectorial role covering all pillars of the Framework Programme (sustainable agriculture, food & nutrition security, natural resources & environment, migration, socio-economic development)  -2030 Agenda – Sustainable Development Goals  -Commitments under the Paris Agreement (2015)  Target beneficiaries:  -Public authorities  -Civil society  -Beneficiaries in procurement contracts  Geographic coverage:  -Geographic pillar of the External Instrument covering the Neighbourhood, Sub-Saharan Africa, Americas, Asia and Pacific and European non-EU member states, corresponds to global reach of the Framework Programme … | Market uptake:  -Infrastructure projects  -Investment projects |
| Support to clusters, hubs and broader innovation ecosystem:  -Socio-economic development programmes including access to finance, capacity building and entrepreneurship programmes.  -Support to clusters, hubs and broader innovation ecosystem: Development of technology roadmaps | R&I Infrastructure:  -Laboratory and research facility benchmarking and development  Human capital development:  -Capacity building for researchers as well as  -Education  -Researcher/expert mobility  Networking and policy making:  -EU representation in international for a and organisations including at regtional level (e.g. the Union for the Mediterranean) |

The Neighbourhood, Development and International Cooperation Instrument groups together several existing external instruments
[108](#footnote109)
 under the current MFF in addition to the European Development Fund, which is brought under the EU budget. This new design will address at least in part some of the present fragmentation in external instruments and favour complementarities and synergies, particularly at implementation stage, between detailed external programmes and the Horizon Europe. Synergies will ensure that Horizon Europe activities with the participation of Third Countries and targeted international cooperation actions seek alignment and coherence with parallel market uptake and capacity-building actions under the Instrument.

There are inherent complementarities between Horizon Europe and the Neighbourhood, Development and International Cooperation Instrument, for example in so far as they both contribute towards the EU's international commitments such as the 2030 Agenda for Sustainable Development
[109](#footnote110)
, the Paris Agreement on Climate Change
[110](#footnote111)
, or the renewed EU-Africa Partnership
[111](#footnote112)
 among others.

The overall objectives of the Neighbourhood, Development and International Cooperation Instrument will focus on supporting sustainable economic, social and environmental development, reducing global poverty, maintaining a special relationship with neighbourhood countries and addressing global challenges.

Targeted international cooperation actions will be mainly implemented through the Framework Programme's call topics dedicated to international cooperation. This will pursue the trend of the final years in Horizon 2020 flagship initiatives as a means to lever international cooperation. In addition European Partnerships are also expected to play an important role in structuring cooperation with Third Countries. These comprise both co-programming and co-funding activities. Where relevant, the Framework Programme's partnerships with the participation of Third Countries should seek alignment and coherence with parallel capacity building strands within the Instrument, based on common defined priorities. 

Box 7 Concrete example of how synergies could look like in practice

|  |
| --- |
| ·The Neighbourhood, Development and International Cooperation Instrument develops research capability and supports the role of academia and evidence-based policy making in third countries. Capacity building takes place at individual level, for example through brain circulation and training; at organisational level (laboratories, building research departments) and institutional (by developing good governance, regulatory environments and incentive schemes).  ·The EU-African Union partnership will develop a joint research and innovation programme on renewable energy to adapt renewable energy technologies to the African environment, social and economic conditions through joint research efforts. Subsequently market take-up and scaling of technologies and solutions developed could be undertaken by the External Instrument in African markets.  ·As part of the external dimension of internal EU policies, opening trade and cooperation in other policy areas including migration and visas are also key contributors for establishing framework conditions for innovation and the penetration of technologies developed in the EU in world markets. |

13Synergies with the European Space Programme

Space technologies, data and services can support numerous EU policies and key political priorities, including the competitiveness of our economy, migration, climate change, the Digital Single Market and sustainable management of natural resources. Space is also of strategic importance for Europe. It reinforces Europe’s role as a stronger global player and is an asset for its security and defence. Space policy can help boost jobs, growth and investments in Europe. Investing in space pushes the boundaries of science and research. Europe has a world-class space sector, with a strong satellite manufacturing industry, which captures around 33 % of the open world markets, and a dynamic downstream services sector with a large number of SMEs. The European space economy, including manufacturing and services, employs over 230 000 professionals and its value was estimated at EUR 46-54 billion in 2014, representing around 21% of the value of the global space sector .

The Union has made a strong political commitment with the Space Strategy for Europe, supplemented by an ambitious space agenda welcomed by the Council and European Parliament which provided further political orientations. The Space Strategy focuses on four strategic objectives: (1) Maximising the benefits of space for Europe’ society and economy; (2) Fostering a globally competitive and innovative European space sector; (3) Reinforcing Europe’s autonomy in accessing and using space in a secure and safe environment; (4) Strengthening Europe’s role as a global actor and promoting international cooperation.

Europe needs to maintain and further strengthen its world-class capacity to conceive, develop, launch, operate and exploit space systems. To ensure this, there is need to support the competitiveness of the whole supply chain and actors from industry to research organisations. There is also need to foster the emergence of an entrepreneurial ecosystem, opening up new sources of financing, creating new business opportunities, and making sure this will benefit businesses in all Member States.

Coherence and synergies between the space programme and Horizon Europe will be instrumental for the delivery of solutions to the aforementioned challenges. Space research shall be an integral part of the Global Challenges pillar of Horizon Europe, with research and innovation needs of space sector identified and established as part of the programme's strategic planning process. Space data and services made available by the Union space programmes will be used to develop breakthrough solutions. Horizon Europe will also be instrumental to foster the space entrepreneurial innovation ecosystem through the Open Innovation pillar and to push the frontiers of space science through the Open Science pillar. Space data and services made available through the European Space Programme can be used to develop breakthrough solutions through research and innovation, including in Horizon Europe, while Copernicus Data and Information Access services will contribute to the European Open Science Cloud and thus facilitate access to this data.

Box 8 Concrete example of how synergies could look like in practice

|  |
| --- |
| ·Space data and services made available as a public good by the Union Space Programme will be used to develop breakthrough solutions through research and innovation, in particular for sustainable food and natural resources, climate monitoring, smart cities, automated vehicles or disaster management.  ·The Copernicus Data and Information Access Services contribute to the European Open Science Cloud and thus facilitate access to Copernicus data for researchers and scientists.  ·Horizon Europe will underpin the evolution of the Union Space Programme systems and services as well as the competitiveness of the space sector, notably with regard to sustainability of supply chains, non-dependence and access to space.  ·Technology transfer from the space ecosystem can enable multidisciplinary innovation and entrepreneurship.  ·The space innovation ecosystem will be fostered by the open innovation pillar of Horizon Europe through a mechanism for pipelines of projects emerging from the implementation of the Space Programme.  ·Research infrastructures, in particular in situ observing networks constitute essential elements of the in situ observation infrastructure enabling the Copernicus services. In turn, they benefit from information produced by Copernicus services. |

14Synergies with the Innovation Fund under the EU Emissions Trading System

Table 14 Innovation Fund under the EU Emission Trading System - Research and innovation related support

|  |  |
| --- | --- |
| Sectors/Domains:  -Innovative low-carbon technologies in energy intensive industries in Annex I of the ETS Directive, energy storage, CCS and innovative renewable energy technologies  Target beneficiaries:  -Enterprises and their grouping  Geographical coverage:  -EU | R&I activities/projects:  -Can support projects as of TRL 6-9  Market uptake:  -Demonstrations & first-of-a-kind commercial scale projects |

The Innovation Fund is established by the revised EU Emissions Trading System (ETS) Directive and will support innovation in low-carbon technologies and processes, including environmentally safe carbon capture and utilisation (CCU) that contributes substantially to mitigate climate change, as well as products substituting carbon intensive ones, and to help stimulate the construction and operation of projects that aim at the environmentally safe capture and geological storage of CO2 (CCS) as well as innovative renewable energy and energy storage technologies.

The EU ETS Directive already sets the frame of the support. For example, projects shall have the potential for widespread application or for significantly lowering the costs of transitioning towards a low-carbon economy for the sectors concerned; technologies receiving support shall not yet be commercially available, but shall represent breakthrough solutions or be sufficiently mature to be ready for demonstration at pre-commercial scale; projects shall be selected in geographically balanced locations within the territory of the Union, etc.

Horizon Europe (and the R&I window of InvestEU Fund) will support research and technology development and innovation in the EU decarbonisation, energy and industrial transformation, especially under pillar 2. However, the need for public financing to overcome the “valley of death” of low-carbon technologies at high TRLs is significant. The Innovation Fund may, subject to fulfilment of its selection and award criteria, support the demonstration phase of eligible projects that may have received the support from the Horizon Europe or its predecessor programmes. Synergies will be sought in governance cooperation and alignment of funding conditions where possible.

  

Box 9 Concrete example of how synergies could look like in practice

|  |
| --- |
| ·Potential Innovation Fund’s support provided via financial instruments could be channelled via the EU Invest R&I window, if possible and relevant, subject to meeting the provisions of the ETS Directive.  ·Further synergies will be sought in governance cooperation, aiming at coordinated approach vis-à-vis final beneficiaries. |

15Relevant studies

·From Rivalry to Synergy: R&I Policy and Cohesion Policy. European Commission, DG Regional and Urban Policy, February 2018.

·In-Depth Staff Working Document for Horizon 2020 Interim Evaluation, SWD(2017) 221 final, May 2017. See in particular section 9.2: "To what extent is Horizon 2020 coherent with other EU initiatives?"

·Issue Papers for the High Level Group on maximising the impact of EU research and innovation programmes. European Commission, DG Research and Innovation, February 2017
[112](#footnote113)
.

·Synergies between Framework Programmes for Research and Innovation and European Structural and Investment Funds – Contributing to the Interim Evaluation of Horizon 2020 Final Report.

·DG Research and Innovation and Joint Institute for Innovation Policy, 2017.

·EU Funds Working Together for Jobs and Growth: Synergies between the R&I Framework Programmes and the European Structural and Investment Funds. European Commission, DG Research and Innovation, 2016.

·Enabling Synergies between European Structural and Investment Funds, Horizon 2020 and other research, innovation and competitiveness-related Union programmes – Guidance for policymakers and implementing bodies. European Commission, DG Regional and Urban Policy, 2014.

·Maximisation of Synergies between European Structural and Investment Funds and Other EU Instruments to Attain Europe 2020 Goals. European Parliament, REGI Committee, 2016.

·European Parliament Resolution of 6 July 2016 "Synergies for innovation: the European Structural and Investment Funds, Horizon 2020 and other European innovation funds and EU programmes"

·Synergies between EU R&I Funding Programmes: Policy Suggestions from the Launching of the Stairway to Excellence. Joint Research Centre Technical Report, 2014.

  

Annex 8 Detailed information on key improvements in the design of Horizon Europe

1European Innovation Council (EIC)

1.1Why do we need an EIC and why should this be done at EU level?

The EU innovation ecosystem generates as many start-ups as the US in number but only a few of them grow-up rapidly
[113](#footnote114)
. This is even truer for start-ups carrying out breakthrough innovation
[114](#footnote115)
 and for the science-based
[115](#footnote116)
 ones (“deep tech”)
[116](#footnote117)
. The fact that the next wave of breakthrough innovation will be science-based calls for immediate action.

Breakthrough innovation that creates new markets and, therefore, growth and jobs, is too rare in Europe. This is due to a range of factors, including lack of venture capital (VC), deep-rooted aversion to risk that builds also on fragmentation of the internal market and regulatory barriers and lack of transfer of new technologies from the research base to the market. The EIB estimates that the total equity funding gap in Europe is EUR 70 billion, of which 85% is represented by the first valley of death
[117](#footnote118)
.

There is market-based evidence emerging from InnovFin Advisory studies
[118](#footnote119)
 that there is a particularly acute funding gap and need for “patient capital” for so called “deep tech” companies (such as Key Enabling Technologies, Life Science and semiconductor and photonics). These companies are characterised by high capital intensity, high technology risk, and long development periods. The combination of these factors make the investment proposition of “deep tech” companies less appealing from a risk/return prospective than companies such as ICT/digital (which mainly assume product and execution risk).

  

Figure 16 Equity funding in the EU: gap of EUR 70 billion in the SMEs and mid-caps space (up to 3,000 FTEs)

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08020.jpg)

Source: Deloitte, July 2016

High-growth potential firms, which receive public funding in the form of equity, contribute to job creation and growth. The employment growth rate varies from 50% to 145% and turnover from 125 and 800%
[119](#footnote120)
. Evidence shows that innovative firms not only grow twice as much as their non-innovative counterparts in terms of employment but also "faster growing firms continue to innovate providing impulses to rejuvenate the economy"
[120](#footnote121)
. This may be due to their absorptive/learning capacity and intensive R&I activities
[121](#footnote122)
.EU support to breakthrough innovators needs to evolve towards an agile, seamless and tailor-made approach. Current EU support to breakthrough innovators remains fragmented, complex and does not attract the most innovative companies. It is often described as complex to navigate, too prescriptive, uncoordinated, involving many rules, inflexible projects, forms of funding and management designed for classical R&D projects, not fitting with innovators needs (“one size fits all approach”), etc. Moreover, current EU programmes do not address in a seamless way the required tailor-made support to science/technology leading to breakthrough innovation and scaling up.

|  |
| --- |
| Challenges |
| Europe lacks venture capital for companies to scale-up fast.  The ample supply of venture investment helps US companies to turn market-creating innovations into world-leading companies, while Europe's innovators struggle to access risk finance above the €10 million range. [122](#footnote123)  The supply of flexible, agile funding, such as via blended finance (combining grants with loans or equity), or through crowdfunding, is insufficient. This hampers young innovative companies (‘yollies’) to scale up to ‘Unicorns’ [123](#footnote124) . 'Unicorns’ are young companies reaching a market valuation of $ 1 billion. Europe has 26, China has 59, and the US has 109. Per capita, Europe has 7 times fewer unicorns than the US.    Lack of financial resources is the main challenge that EU companies face when commercialising their innovative goods and services [124](#footnote125) . Two-thirds of VC investments in Europe are in the home country of the investor only [125](#footnote126) . Consequently many European start-ups move to the US: US companies enjoy 14 times more later-stage capital than their European counterparts do [126](#footnote127) . The European stock markets provide insufficient help. In 2012-2016, the average European venture capital exit via Initial Public Offering was nearly $70 million versus $220 million for the US [127](#footnote128) . |
| Access to finance for young high growth innovative enterprises needs to be improved  The data on new lending to SMEs shows that of the 25 countries that provided data for 2016, growth in new SME loans was negative in 15 of them, sometimes substantially. In the Czech Republic and Denmark, SME loan growth turned negative in 2016 following positive growth in the previous year. Austria, Luxembourg, Portugal and Slovenia witnessed a bigger decline in 2016 than in 2015. In only a minority of instances, growth rates turned positive or strengthened [128](#footnote129) .    In fact, most SMEs, including new, innovative and fast-growing firms, remain heavily reliant on internal resources and traditional bank debt. The lack of appropriate forms of finance, especially of the equity-type, stands in contrast with large businesses, and is limiting entry, long-term investment, expansion and innovation [129](#footnote130) .    According to an EIB study, a significant proportion of KETs companies, including innovation leaders with a documented solid growth, find it hard to raise the capital needed to expand. Thus, while there is evidence that high-growth innovative firms can be catalysts for aggregate economic growth, their capacity to grow is highly dependent on the access to financial resources [130](#footnote131) . Almost 30 per cent of the KETs companies fail to obtain adequate debt financing. KETs companies (about 50 per cent) find themselves severely struggling to obtain the finance needed to generate further growth and innovation [131](#footnote132) .    Europe has a shortage of risk capital for small, early-stage growing businesses. This is holding back the development of high-growth sectors such as technology, which are essential for economic competitiveness. While sources of capital such as crowdfunding and business angels are becoming more accessible, the EU is still at a significant disadvantage to the US [132](#footnote133) . |
| Europe needs high growth companies to create new jobs  Among the 23 million European SMEs, only a fraction are high growth companies quick to grow, invest, create jobs and become leaders in their respective markets. "With more equity investment, more businesses could survive and potentially create new jobs. But start-ups, scale-ups and high growth companies respectively need seed, early-stage and expansion capital to reach their objectives" [133](#footnote134)  . |
| Europe is associated with a deep-rooted aversion to risk  Europe is associated with 'a deep-rooted aversion to risk' and a low entrepreneurial spirit compared to the US, China and Korea [134](#footnote135) . In Europe—like most of the world—failure in business can be a stigma, inhibiting an entrepreneur’s ability to secure new investors. Relatively few European start-ups (compared to Silicon Valley) set aggressive goals or start with the idea of changing an industry or the world, instead targeting niche growth in their home markets'.  European financial intermediaries (e.g. banks) are also risk averse when confronted to high risk projects. Banks appear to have become more risk averse compared to the pre-crisis period, to the detriment of innovative companies, young firms and start-ups [135](#footnote136) . For instance, under the InnovFin actions in Horizon 2020, the European Commission had to provide 100% guarantee for products such as Energy Demo Projects (EDP) and Infectious Diseases Finance Facility (IDFF) to get the intermediaries on-board to provide loans. |
| Europe lacks transfer of new technologies from the research base to the market  According to the 2016 Eurobarometer [136](#footnote137) , around two thirds of European manufacturing companies have not recently used any advanced technologies and this proportion has increased considerably since the 2015 survey. At the same time, significant resources have been devoted over recent years by the US and Asian economies toward the development and deployment of key enabling technologies such as ICT, nanotech and biotech in such companies. The results can be seen in the ICT industry world-wide. Most of the biggest R&D intensive ICT companies are in US or Asia and many of them are young. [137](#footnote138) |
| European innovators cannot exploit the scale of the Union and face regulatory complexity  In Europe, innovators and companies with international growth potential have to cope with 28 national markets with their diverse currencies, languages and business cultures. [138](#footnote139)  Such fragmentation also applies to the innovation ecosystem. While Europe is home to a growing number of hotspots (London, Berlin, Paris, Stockholm and Amsterdam now figure in the top-20 world-wide start-up ecosystems [139](#footnote140) ), these are not well connected [140](#footnote141) . Also, regulations can hinder company growth [141](#footnote142) , especially the 'maze of regulatory regimes' in Europe. [142](#footnote143)  Consequently, European start-ups tend to move to the more homogeneous US market. [143](#footnote144) |
| Current EU support is not optimal for breakthrough innovation  Horizon 2020 is the first European programme to support innovation next to research, but few of the young and quickly growing innovative companies take part. The current support is seen as too complex and the multitude of acronyms discourages them to apply. EU support has tended to focus on incremental innovation and prescribed thematic topics that often do not correspond to modern innovation taking place at the intersection between different sectors and dsiciplines. |

Tackling these challenges at the EU level allows:

§To pool resources and unleash the potential of European and global markets for EU innovators. Scaling up to exploit the European market is the first step towards international growth. Only the EU as a whole has the capacity to tackle persistent lack of large-scale high-risk venture capital. EU support can be bigger in size and more comprehensive (e.g. common regulation) compared to national or regional support.

§To encourage risk taking and increase the quality of innovations through EU-wide competition between the best. This will provide Europe’s best innovators with resources they need to allow them to scale up and compete better at global level. Operating across Europe on a competitive basis will allow to draw on a wider pool of talents and ideas than would be possible through national schemes. Only the most risky and most breakthrough ideas will compete against each other.

§To create synergies across Europe (and beyond) by stimulating cross-border cooperation mainly through networks
[144](#footnote145)
. European support for innovation creates synergies with related regional and national programmes, agencies and financial intermediaries. For instance, tackling the problem of slow industrial transformation at the EU level provides the critical mass and the networks needed to develop and take up key enabling technologies by manufacturing companies and their supply chains
[145](#footnote146)
.

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| What do we have now in Horizon 2020?   SME Instrument provides EUR 500 million per year in grants to SMEs for investigation of technical and commercial feasibility of a business idea and development of innovation with demonstration and scale-up purposes (TRL 6).   Fast Track to Innovation provides EUR 100 million in grants to consortia of partners from different countries with innovation projects addressing any technology or societal challenge field. It aims to reduce time from idea to market and to stimulate the participation of first-time applications to EU research and innovation funding.   Future and Enabling Technologies (FET) provides EUR 200 million per year in grants to collaborative research. It aims to stimulate bottom-up small scale explorations (FET-Open), build up a critical mass around promising directions (FET-Proactive) and fund large scale interventions that require a common European effort over a longer period to pursue grand challenges in science and technology (FET Flagships, such as Graphene and the Human Brain Project).   InnovFin actions provide EUR 400 million per year in loans to single beneficiaries for investment in research and innovation, guarantees to financial intermediaries making loans to beneficiaries and combinations of loans and guarantees, guarantees or counter- guarantees for national, regional and local debt-financing schemes, venture and/or mezzanine capital to individual enterprises in the early stage (start-up window).  EU awards challenge prizes to innovators who develop a new solution for a highly demanding challenge, such as the battery of the future with advanced specifications. These prizes are open to any bids and can attract both incumbents and newcomers. They are top-down in defining the challenge, but encourage bottom-up new approaches.  Public procurement of innovative solutions (PPI) are grants for establishment of networks of public procurers to prepare for launching PPI as well as direct financing of consortia of public procurers to undertake PPI procurement.  Pre-commercial procurement (PCP) are grants to consortia of public procurers to buy R&D from several competing suppliers in parallel to compare alternative solution approaches and identify the best value for money solutions that the market can deliver to address their needs.  What have we learned from Horizon 2020 Interim Evaluation?  Horizon 2020's Interim Evaluation identified that the Framework programme has a potential for supporting breakthrough, market-creating innovation, but noted that such support must be considerably strengthened in the future.  In particular, Horizon 2020 Interim Evaluation assessed the programme lacks connection between grant and loan based financing for companies. Horizon 2020 invests EUR 400 million per year in risk financing through European Investment Bank (InnovFin) but only a small number of firms receiving Horizon 2020 grants benefit from such financial instruments.   Similarly, Horizon 2020 invests EUR 500 million per year in the SME Instrument. The Interim Evaluation assessed that the scheme is on track to deliver innovations to the market by providing grant based funding and business acceleration services to SMEs. However, there is also scope for improvement such as the need to scale up companies and the need for more interaction with business angels and Venture Capitalists.  The Communication on the Interim Evaluation notes that the future Framework Programme should provide support faster and more flexibly and build on the current achievements in innovation support through the SME Instrument, collaborative projects and public-private partnerships.  Horizon 2020 supports scientific excellence in Europe and has contributed to high-profile scientific breakthroughs. But there is a need to raise the breakthrough market-creating innovations, which is vital for future growth and jobs. This is not about switching budget from fundamental research to innovation, but about generating more impact from innovation funding. The increasing impact could build on key ingredients in the success of the European Research Council, for example building a prestigious brand focused around excellence, with a strong bottom-up emphasis. |

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| What do stakeholders say?  ·The Lamy High Level Group [146](#footnote147)  called for a 'true EU innovation policy that creates future markets' and proposes that the impact of the EU programme is maximised by fostering ecosystems for research, innovators, industries and governments, and by investing in innovative ideas with rapid scale-up potential. The group notes that an ambitious European Innovation Council should be a central pillar in the next EU research and innovation programme. It also recommends (#4 Design the EU R&I programme for greater impact) that the EIC design new proposal evaluation and selection processes to better capture high-risk, high-return projects, introduces greater flexibility in grant management (stop-go decisions) and tolerates failure.  ·The High Level Group of Innovators, advising the Commission on innovation , developed a set of recommendations to support single innovators turning disruptive/breakthrough science and technology into market-creating innovations [147](#footnote148)  :  ­Funding: empower the innovator, simplify, incentivise private investment,  ­Awareness: champion innovators, communicate success,  ­Scale: build the camp, leverage European ecosystems,  ­Talent: connect people, create prestige for innovators.  ·The Commission engaged in a dialogue with a variety of other stakeholders to gain more insight on options for EIC. A consultation process was organised with national innovation agencies [148](#footnote149)  as well as the wider innovation community through a 'Call for ideas' [149](#footnote150)  and cluster consultation. In their feedback through the position papers, stakeholders called for:  ­European Innovation Council that increases synergies and acts as European Accelerator. Some 51% of all stakeholders submitting a position paper for the Framework Programme expressed their views on the idea of the European Innovation Council (EIC). Around two thirds of these stakeholders favour the overall idea of EIC providing detailed suggestions on the possible role and objectives of its organisation and concrete modalities for its functioning.  ­A reoccurring view is that the EIC should not add an extra layer of governance, but rather seek to identify gaps, coordinate and forge synergies with the existing support instruments serving as an umbrella initiative with a concretely defined value added.  ­The idea of bringing together existing instruments (SME instrument, Fast Track to Innovation, FET Open and inducement prizes) for a comprehensive support to all forms of innovation and technologies, including market-creating innovation is well echoed across the stakeholder input.  ­For example, Tekes considers that the role of EIC is to provide the best applicants with a tailor-made growth package including a combination of public and private funding fit for the needs of the company. This must be complemented by top-level expertise services like coaching, mentoring, training, soft landing measures etc. In other words, “EIC should act as an European Accelerator bringing all relevant EU funding and services into a single, fit-for-purpose 'one-stop-shop' for the most promising enterprises”. Some stakeholders (for example, CEASAR) view EIC as a label for excellence and a vehicle to leverage more private investments.  ­The main concerns expressed are that support to incremental innovation should not diminish due to an increased emphasis on radical and ground-breaking innovation that the EIC is envisioned to promote. Four position papers (Denmark, Flanders, Croatia and ALLEA) inexplicitly caution against the creation of a separate organisation. These stakeholders suggest evaluating more carefully the possible merging of the EIC mandate with EIT, FET or ERC to capture the whole research-innovation spectrum. |

1.2What do we want to achieve with the EIC?

With the European Innovation Council (EIC), the objective is to identify, develop and deploy breakthrough innovations, and to support the rapid scale-up of innovative firms carrying out market-creating innovations at EU and international levels.

The EIC will aim at:

1Fostering breakthrough and market creating innovations in EU and support the rapid scale-up of innovative firms at EU and international levels;

2Sharing high risks involved in breakthrough innovations, leveraging public and private investment; ensuring the selection of the most promising ideas and impacting innovations, researchers and innovators;

3Increasing entrepreneurial and risk-taking mind-set in Europe through structural impact of EIC-funded projects and innovators setting a clear and inspirational targets for breakthrough innovation in Europe;

4Simplifying EU support schemes for breakthrough market creating innovations by combining existing schemes under one EIC umbrella.

The EIC will not create an additional administrative layer; on the contrary, it will provide a one-stop shop for innovation support thereby making the programme more user friendly.

1.3What changes will the EIC bring and what are the expected implications?

To place the EU in the lead for breakthrough market-creating innovation, the European Innovation Council (EIC) will be set up under the Open Innovation Pillar of the Framework Programme.

The EIC will combine all EU support to breakthrough and market-creating innovation in one place. It will build on the experience gained with Access to Risk Finance and the EIC Pilot launched early 2018 under Horizon 2020, which grouped relevant existing schemes and introduced first reforms (e.g. simplified application form and interviews with potential beneficiaries). However, this pilot phase is constrained by the legal acts of Horizon 2020 and much more is possible in Horizon Europe.

The EIC will provide tailor-made support to innovators through two main funding instruments – the Pathfinder and the Accelerator - with the following common characteristics: a focus on breakthrough innovation; a largely bottom-up approach (with top-down elements); a high-risk taking behaviour; a focus on innovator needs; and a pro-active management.

§The Pathfinder for Advanced Research will provide grants for early technology stage (proof of concept, technology validation) to early commercial stage (early demonstration, development of business case and development of strategy). Top-down competitive calls developing key strategic objectives
[150](#footnote151)
 calling for deep-tech and radical thinking will allow to establish critical mass of effort and build up and structure new research communities of a multidisciplinary nature. However, the Pathfinder will also allow for the submission of proposals on a bottom-up basis, so as to stimulate the opportunities of serendipity and unexpected ideas, concepts and discoveries. The Pathfinder will be open to all, from academic researchers to start-ups, SMEs and mid-caps.

§The Accelerator will support the further development and market deployment of breakthrough and market creating innovations, to a stage where they can be financed on usual commercial terms by investors (from demonstration, user testing, pre-commercial production and beyond, including scale-up). It will provide tailor-made blended finance (i.e. grant type support with equity financing or financial guarantee) through a single process and according to the needs, stage of development and risk profile of the innovation. The Accelerator will be open to all innovators, start-ups, SMEs and midcaps, but will also accelerate innovations / spin-offs / start-ups generated within the Pathfinder as well as from any other parts of the Framework Programme such as European Research Council (ERC), the European Institute of Innovation and Technology's (EIT) Knowledge and Innovation Communities (KICs) and R&I missions. This instrument will finance projects with high risks concerning innovation that is close to market, or small businesses investments. The open and bottom-up calls will be complemented by focused approaches on emerging breakthrough or disruptive technologies of potential strategic significance.

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| What is blended finance?  'Blended finance' is a financial instrument that combines grant-type support with equity or access to loans and other types of finance. Finance can be blended both simultaneously — for example, as a grant-plus-loan package offered at once— and sequentially, as when a grant attracts a later investment by a VC fund, business angel or corporate VC arm, or facilitates a loan from a bank or a non-bank lender. The EIC’s Accelerator will essentially target high-risk potential market creating innovations. It will hence provide for simultaneous blending, with the aim of de-risking more and from the onset selected operations and attract later stage co- or alternate private investors.  Why blended finance?   Grants may be provided up to demonstration stages, but only covering part of the costs and for limited amounts. Financial instruments such as those to be deployed under InvestEU intervene when a project is "bankable", meaning there is a return on investment, or where the level of risk can be easily mitigated and be acceptable for private investors, including VC funds. This leaves innovators facing “the valley of death” where there are high development costs (which can only be partially covered by grants) but where the level of uncertainty and risks for making returns are too high for private investors. The EIC’s Accelerator aims at bridging this valley of death and to de-risk selected operation so as to leverage these investors. |

Under both Pathfinder and Accelerator, each EIC awardee would also be offered a series of support services such as coaching, peer to peer mentoring, facilitated access to services provided by others schemes (EIT, national and regional, corporates, etc.), specific support to help with regulatory barriers ("innovation deal" like), access to world-class fairs, etc. The Commission will organise an EIC Forum of Member States’ and Associated countries’ public authorities and bodies in charge of national innovation policies and programmes, with the aim to promote coordination and dialogue on European innovation ecosystem.

The EIC work programmes will be implemented by a single implementation structure pro-actively managing all EIC funding (i.e. an executive agency and a specific vehicle/networks of finance partners), including the possibility to stop or amend the projects, to support and use technology intelligence in order to strengthen the potential of the projects, etc. This calls for the involvement of programme managers (ARPA-E approach
[151](#footnote152)
) who are able and empowered to interact with innovators/market players. In particular, programme managers will propose evaluation ranking based on the constitution of consistent strategic portfolio of projects, expected to make essential contributions to the emergence of potential societal or economic market creating innovations. An EIC Advisory Board (composed of high level investors, entrepreneurs, etc.) will support and guide these programme managers. The EIC Advisory Board will also have the responsibility to advise the Commission services on the implementation (e.g. design of work programme and evaluation processes), to assess emerging technologies and trends (including by bringing in top expertise in areas identified by the programme managers), etc.

The EIC will fund what other investors do not dare to invest into, or at least not alone (risk aversion). In that context, the EIC shall rely on expertise stemming also from the investment world, and also allow for investors to submit projects for which sharing the risks is key (pre-screening).

In order to mitigate risks of distortion of competition, the EIC will operate at market price and will exit from investment as soon as alternate investors are ready to substitute (no crowding out effect).

The EIC would considerably simplify the funding landscape and fill the gaps that currently exist.

Figure 17 Pathfinder and accelerator in the EIC

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_08021.jpg)

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| Evolution not revolution: the EIC from Horizon 2020 to Horizon Europe |

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| --- |
| A need for a dedicated implementation structure?  Three scenarios of implementation structure for the EIC are envisaged based on the expected difference in the programme management between Horizon 2020 actions and the EIC namely a move from generic to specialised profiles, passive to active management and from process-driven to portfolio driven management. The three scenarios are as follows:  §Scenario 1: Business as usual - existing EASME as the EIC implementing Executive Agency;  §Scenario 2: EASME revamped as EIC exclusive implementing Executive Agency by transferring non-EIC activities from EASME to other agencies; or  §Scenario 3: EIC implemented by a dedicated newly created Executive Agency possibly starting with the pilot under Horizon 2020 and continuing under Horizon Europe.  Further assessment of different implementation options shall be based on a dedicated cost benefit analysis. |

1.4What are the expected implications?

|  |  |
| --- | --- |
|  | ·More innovations that create the new markets of the future. Giving more prominence and visibility to science-based breakthrough innovation, the EIC will allow the future Programme to increase its capability to attract Europe’s best innovators. The selection process by peer-scientists and innovators and investors will increase probability of supporting the most promising innovators. Those that will be selected will be managed actively (by programme managers empowered as responsible authorising officers) based on a set of challenging targets and possibility to amend and terminate the projects when necessary which will further increase the probability of their breakthrough. The type and volume of financing will be tailor-made to the needs. According to the High Level Group of Innovators [152](#footnote153) , a successful EIC should allow the EU to be home to leading companies in major areas for breakthrough deep tech innovation such as Artificial Intelligence, biotech, and augmented/virtual reality (e.g. 1/3 of the leading global companies should come from Europe). |
|  | ·Scaled up companies and higher SME growth The EIC will support late stage innovation activities and market deployment for the most promising ideas, resulting in an increase in the number of growing EU start-ups and SMEs. It will target innovative companies (up to mid-caps) with a great potential for scaling up, offering tailor-made type and volume of financing to the needs of the firm, its size and stage, the nature of the technology and the length of the innovation cycle/market deployment. Co-investment in equity or through guarantees for alternative types of finance (e.g. bank loan) will be awarded for scale-up. These measures are expected to help filling-in the missing gap in risk finance in Europe (“bridging the valley of death”). Such support is expected to have a positive impact on the growth, market valuation, employment and turnover of EU companies (especially SMEs). |
|  | ·Increased complementarities between grant-type funding financial instruments and leverage from private investment. Under the EIC Accelerator, blended finance would allow the Union to bear the initial risk of deploying market breakthrough innovations, with the aim of de-risking these operations as they unfold, down to a stage where they can be financed through private capital, hence incentivize private investors. The EIC support through blended finance should lead to a greater propensity to co-invest or to offer lower interest-rates loans and less onerous requirements for collateral, hence to more breakthrough market-creating innovations to be effectively translated and deployed in the market. Financing will be targeted to involve private investors on the basis of de-risking. The alignment of interests with private investors will provide improved access to venture capital and risk finance, hence leveraging the overall volume of finance necessary to develop the innovation to a stage where it can be financed through private capital. |
|  | ·More entrepreneurship and risk-taking. The EIC will provide business acceleration services to innovators and will award EIC Fellowships to the outstanding ones. The EIC will highlight innovators who can inspire others (researchers, youngsters and other potential entrepreneurs) to set up and grow their own enterprises. |
|  | ·More accessible and user-friendly support to innovation. The EIC support and services will be provided through a one-stop shop enabling easy and quick access for innovators to EU support. |

1.5What alternatives were considered?

Four alternative policy options were considered and discarded:

§Full centralisation: Under this option, public support for market-creating innovation at the EU level would be fully centralised. The EU would replace the existing national, regional and local level support to promote market-creating innovation.

§
   Discontinuation: This option assumes that the EU R&I Framework Programme would stop financing activities related to market-creating innovation. The public support for market-creating innovation would become fully decentralised and solely in the remit of the Member States.

§
   Horizon 2020: Under this option, the initial Horizon 2020 measures to support innovation would continue. This would include the SME Instrument, Fast Track to Innovation (FTI) and FET Open (and, by implication, other running innovation support actions such as InnovFin, Eurostars, JTIs and KICs). 

§
   Horizon 2020 with the EIC Pilot: This option would combine the three Horizon 2020 measures that offer most opportunities for potential market-creating innovations: the SME Instrument, FTI and FET Open under one umbrella; it would make the SME instrument bottom-up, evaluate the proposals with interviews by financiers and innovators, extend mentoring and coaching to support SMEs; and it would blend grants with financial instruments to assist the growth of companies. InnovFin, Eurostars, JTIs and KICs measures would remain the same as under Horizon 2020 option. This option is being implemented in the second half of the Horizon 2020 programme. However, as this pilot is staying within the legal and budget boundaries of Horizon 2020, its effectiveness and coherence would remain flawed: the link between direct innovation support (grants) and indirect support (loans, VC) would remain weak; a parallel time-consuming evaluation and decision process would take place through indirect financial instruments, abiding to different criteria and risk perception for private investment; there would be no explicit interface between the EIC and the other parts of the Framework Programme and the three grant schemes would remain 'joint' in the pilot but without optimal coherence.

  

1.6How will the EIC be implemented?

|  |  |  |  |
| --- | --- | --- | --- |
|  | Pathfinder | Accelerator | |
| Management | §European Commission assisted by EIC Advisory Board and supported by an executive agency:  ­EIC Advisory Board: Established by specific programme decision will assist the Commission in setting the overall strategy, governance of the instruments, the work programmes  ­A dedicated implementation structure with high-level programme managers (5 years non-renewable) acting as Responsible authorising officers (RAO) managing Pathfinder’s portfolios of projects. RAOs will consult with the EIC Advisory Board. RAOs decide on Pathfinder’s transition activities and steer their beneficiaries. Pathfinder and Accelerator projects may be amended or terminated by RAO if milestones are not met. | | |
| Aim | §Strengthening the emergence and development of breakthrough science/technology leading to breakthrough innovation | §Accelerating and accompanying the scale-up of enterprises carrying-out breakthrough innovation | |
| Target group | §Researchers, universities, start-ups, SMEs: from single beneficiaries to multi-disciplinary consortia. | §Innovations / spin-offs, including those generated within the Pathfinder as well as any other part of the Framework Programme  §Individual entrepreneurs, mainly start-ups and SMEs, including young and women innovators. | |
| Toolkit | §Research and innovation actions (RIA): grants to high-risk cutting-edge research projects from early technology stage (proof of concept, technology validation) to early commercial stage (early demonstration, development of business case and development strategy)  Available to all legal entities.  §Transition activities: Proactive management of portfolio of related RIA projects, on theme distinct from Pillar 2 missions and industrial road-maps. Establish a critical mass of European researchers, building up and structuring new interdisciplinary research communities with the objective to bring market creating breakthrough ideas to genuine and mature innovations. Activities may consist in additional grants to existing actions, new RIA, innovation actions and coordination and support actions (e.g. feasibility studies for SMEs) | §Innovation and market deployment actions: blended finance (i.e. grants with direct equity financing and access to lean financing) for further development and market deployment of breakthrough and market creating innovations, to a stage where they can be financed on usual commercial terms by investors (from demonstration, user testing, pre-commercial production and beyond, including scale-up).    §Business acceleration services: access to networks of potential partners and investors    §Equity and bank guarantee to other types of finances: to be managed in close relation with InvestEU and EIB Group (service level agreements). Management of equity may entail the establishment of a dedicated Investment Fund in close relationship with the EIB group. | |
| Calls | §Bottom-up and top-down calls, following the ethical principles of the framework programme.  §periodical competitive closing dates  §direct award (no call) of small CSA (50,000 euros) in the context of transition activities | §Bottom-up and top-down calls, following the ethical principles of the framework programme.  §cut-offs every two months, first come first served basis  §Business acceleration services may involve coordination and support actions, including procurements. | |
| Selection/Evaluation | §Selection criteria: excellence of science and innovation, impact (market-creating nature) and excellence of delivery (quality of organisation)  §evaluated by expert panels | §Selection criteria: excellence of science and innovation, excellence of the impact (marketability), and the level of risk;  §Step 1: Expert panel (e.g. researchers and scientists)  §Step 2: Expert panel (e.g. innovators and investors)  §Step 3: Interviews with expert panel (e.g. innovators and investors)  §Projects may be amended or terminated if milestones are not met. |
| Links to other programme parts | §Selected RIA falling within the scope of Pillar 2 missions shall be managed in close relation with related mission portfolio.  §Close coordination with ERC and EIT KICs. | §Will accelerate innovations / spin-offs/ start-ups generated within Horizon Europe, in particular the ERC, EIT KICs or other parts of the Global Challenges and Industrial Competitiveness pillar following a fast-track procedure that builds on previous review. | |

1.7Complementarities with InvestEU Fund 

EIC support would be clearly differentiated from InvestEU products:

·EIC would only support start-ups / SMEs where the risk profile requires a component of grant funding and strong public support to lower risks for private investors to intervene. Innovative SMEs that can be financed through private debt or equity would be directed to the schemes provided under the InvestEU Fund (notably under its SME Window – innovative SMEs dimension).

·EIC would be highly selective, targeting those innovations that have a breakthrough nature (not incremental improvements to existing products, services or business models) and essentially support start-ups/SMEs where the profile requires a component of grant funding and strong public support to lower risks for private investors to intervene.

·EIC funding would be based on specific governance. While final financing decisions would be made by the Commission, this would follow assessments by the best independent expertise from across Europe (e.g. to judge the breakthrough nature) and strategic advice from the EIC Board.

1.8Relevant studies

·Funding - Awareness - Scale - Talent (FAST): Europe is back: Accelerating Breakthrough Innovation, Full set of recommendations from the Independent High-Level Group of Innovators on establishing a European Innovation Council, January 2018.

·LAB-FAB-APP: Investing in the European future we want: Report of the High Level Group on Maximising the Impact of EU Research and Innovation Programmes, July 2017.

·Europe's future: Open innovation, open science, open to the world : reflections of the Research, Innovation and Science Policy Experts (RISE) High Level Group, May 2017.

·European Commission (2017), Interim evaluation of Horizon 2020, Staff Working Document (SWD).

·Improving Access to Finance for Beneficiaries of the SME Instrument, InnovFin Advisory (EIB), 2018.

·Improving access to finance for young innovative enterprises with growth potential: evidence of impact on firms' outputs JRC 2017.

·The Shortage of Risk Capital for Europe’s High Growth Businesses AFME March 2017.

·Financing SMEs and Entrepreneurs 2018 - An OECD Scoreboard.

·Improving access to finance for young innovative enterprises with growth potential: evidence of impact on firms' outputs JRC 2017.

·Access-to-finance conditions for Key Enabling Technologies (KETs) companies EIB 2016.

·European Small Business Finance Outlook EIF, June 2017.

  

2Research and Innovation Missions

2.1Why do we need EU R&I missions and why should this be done at EU level?

Currently, the EU's investments in research and innovation could have a higher impact on the strategic challenges our society faces and in driving sustainable economic growth. A mission-oriented, impact-focussed approach would enable a sharper EU focus on global strategic challenges and it would enable industrial transformation towards a more knowledge-intensive economy and job creation.

Missions would be designed specifically to privilege cross-sectoral and multidisciplinary collaboration. They should capture public imagination and involvement by setting a clear and inspiring time-bound goal for Europe, which would have clear and understandable benefits on the daily lives of European citizens. A mission-oriented R&I policy can improve the flow of knowledge across disciplinary and sectoral 'silos', and it can involve end-users and citizens much more closely in EU research and innovation activities. Missions can also stimulate system-wide transformation across many different sectors. Developing strategic research and innovation missions at EU level is a way to provide the necessary scale, scope and wide mobilisation of resources required to address pressing common challenges that cross national borders.

|  |
| --- |
| Challenges |
| Europe's R&I investments directed to tackling societal challenges are spread thinly  Europe invests significant resources in tackling global societal challenges through research and innovation activities providing solutions to those challenges. Around €30 billion from 2014 to 2020 is allocated for collaborative R&I under seven Societal Challenges within Horizon 2020, while a number of other EU-level initiatives (public-private partnerships, EIT Knowledge and Innovation Communities, Industrial Leadership pillar of Horizon 2020) address major challenges facing our society. However, a key finding of the Horizon 2020 interim evaluation is that investment is fragmented across different funds, schemes and instruments. Thus a mission-oriented approach would create more impact by concentrating EU investments in priority areas with a transformative potential for the economy, society and/or environment. |
| Citizens are disengaged from EU research and innovation  The Interim Evaluation of Horizon 2020 emphasises the clear need for greater outreach to citizens. Involving citizens, customers and end-users in the future R&I programme's agenda-setting (co-design) and its implementation (co-creation) will lead to more innovation by stimulating user-driven innovation and greater demand for innovative solutions. This is one of the major opportunities afforded by adopting a more impact-focused, mission-oriented approach in the future. |

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| --- |
| What do we have now in Horizon 2020?  Within a dedicated Societal Challenges pillar, seven societal challenges with a budget of around €30 billion support collaborative research and innovation tackling specific challenges facing our society and economy.    Within Horizon 2020, over 20 Focus Areas were introduced in key areas where priorities cut across different parts of the programme (i.e. blue growth, circular economy, Internet of Things, smart and sustainable cities, Digital Security). Focus Areas concentrate resources and efforts on areas of high policy and political relevance and societal concern. The interim evaluation of Horizon 2020 found that the programme's coherence was reinforced by the use of focus areas, even if their multiplication has also resulted in some confusion.     Under the Future and Emerging Technologies scheme, Horizon 2020 supports two FET Flagship initiatives on Graphene and the Human Brain (with a third Flagship, Quantum, planned to become fully operational under the future programme). These large-scale partnerships are expected to run for about 10 years, with a total budget of around €1 billion each. A key overriding aim is to establish a close link between related activities (at European, national and regional levels) of the research activities that contribute to the Flagship.  What have we learned from the Horizon 2020 Interim Evaluation?  "The EU should not spread its investments in R&I too thinly. Instead, it should prioritise investing in areas where the EU added value is greatest and where the benefits of economies of speed, scale and scope can be reaped. The post-2020 EU R&I programme should thus translate global societal challenges into a limited number of large-scale R&I missions. These would define expected impacts across an entire portfolio of activities, rather than at the level of individual call topics…. Missions should be open to all actors in the research and innovation cycle, easy to communicate and capture public imagination and involvement. They should mobilise many actors and investors, including at national level, and induce action across disciplines, sectors and institutional silos".  ('LAB-FAB-APP: Investing in the European future we want' - Report of the High Level Group on Maximising the Impact of EU R&I Programmes, July 2017) |

In the conception and design of future research and innovation missions, it is also important to take into account lessons learned from ongoing mission-like initiatives across EU countries. These include the “Energiewende” plan to clean the energy system in in Germany by 2050, or the “Fossil fuel-free vehicles by 2030” mission in Sweden. In the USA, the 'Cancer Moonshot' initiative unveiled in 2016 aims to accelerate cancer research to achieve in 5 years (by 2023) research and treatment gains that otherwise might take at least a decade, while the Apollo programme in the 1960s is estimated to have generated more than 400,000 jobs and over 1,800 spin-off companies
[153](#footnote154)
.

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| --- |
| What do stakeholders say?    A wide range of stakeholders back the idea of adopting a mission-oriented approach in the future EU R&I programme. Examples of specific feedback within stakeholder position papers include:    ·"We need to look beyond the short-termism of the current 3-year project cycle. Many of the problems to be tackled through the missions will require contributions from across research fields and involve a wide variety of stakeholders".  ·"The concept of ‘missions’ looks attractive as it captures the objective of prioritising investments in areas with a clear EU added value and of defining expected impacts for each of them. It also has the potential to strengthen the link between research-driven and industry-driven EU level activities".  ·"Continuing the explicit alignment of the United Nations Sustainable Development Goals with the future Framework Programme's missions is warranted for Europe to become the global leader in research and innovation. Europe and its trading partners need a Framework Programme that is mission-oriented, addresses both current and future global challenges, and encourages bottom-up solutions".  ·"The potential added value of missions in the Framework Programme can contribute to making the results of research and innovation more tangible for society at large. For these missions to be successful, however, it is crucial that they have well-defined thematic goals. Missions should focus on topics where a European approach has a distinct added value, and should be generated bottom-up and top-down in broader national and European policy initiatives".    The Economic and Societal Impact of Research and Innovation (ESIR) expert group has emphasised that a future EU mission-oriented approach would substantially increase private investment in R&D and increase the economic impact of research and innovation through deployment diffusion and accompanying spill-overs. In short: a more holistic approach which effectively supports the whole innovation cycle.    A structured consultation process to obtain stakeholder input on future EU R&I missions has taken place, including the opening of a public call for expressions of interest from February 2018 until April 2018. In addition, as part of the Joint Institute for Innovation Policy study (referenced on the final page), over 1800 responses were submitted to an online survey and 40 stakeholders were interviewed. The responses, submitted by all types of stakeholders, strongly emphasise that a mission-oriented approach would increase the impact achieved by the future programme. |

2.2What do we want to achieve with missions? 

The need to create more impact from, and generate more citizen involvement within, EU research and innovation activities through mission-orientation has been identified as one of the key improvements to be made in the design and execution of the future EU R&I programme
[154](#footnote155)
.

A mission-oriented approach in the future EU R&I programme will aim at:

§Prioritising investments where the EU added value in addressing a global challenge (social, economic, environmental) is greatest:

§Focussing on areas with a transformative potential for science, technology, industry or society;

§Inducing cross-sectoral and multi-disciplinary collaboration in achieving mission goals, including the social sciences and humanities;

§Stimulating demand for innovative solutions and support user-driven innovation through co-design and co-creation of missions with citizens and civil society (including by taking into account the local context and smart specialisation, where relevant);

§Improving communication and outreach on the contribution of R&I to providing solutions to major global challenges;

§Inspiring, enthusing and mobilising citizens (and citizen groups)
[155](#footnote156)
 around a clear time-bound goals;

§Set the direction for public and private sector research and innovation activities in Europe, thereby leveraging further investments and improving societal uptake of innovative solutions.

This approach would put into practice a number of key recommendations of the Horizon 2020 Interim Evaluation and the High Level Group report, thus demonstrating that missions would be an appropriate tool of delivery for Horizon Europe.

2.3What changes and what are the expected implications? 

The legal proposal for Horizon Europe will lay down the selection criteria and methodology that will frame a mission-oriented approach, while missions as such will be identified and chosen during the implementation phase. The starting point and reference framework for defining a mission-oriented approach are the UN's Sustainable Development Goals. The SDGs are a powerful point of departure for rethinking Europe’s efforts, instruments and approaches to promote research and innovation (as illustrated by the figure below), including through a mission-oriented approach.

Figure 18 From SDGs to mission-oriented innovation policy

Based on recommendations made by Prof M. Mazzucato, the criteria proposed for selecting missions are: 

·Bold, inspirational with wide societal relevance

·A clear direction: targeted, measurable and time-bound

·Ambitious but realistic in terms of research and innovation

·Cross-disciplinary, cross-sectoral, and cross-actor activities

·Multiple bottom-up solutions.

·Strong EU added value

Horizon Europe will introduce a limited number of highly visible R&I missions. Missions will replace and build on the current "focus areas" used within Horizon 2020. They will be well-defined
[156](#footnote157)
 and self-standing programme parts, as opposed to the focus areas which are 'virtually linked calls' within the Horizon 2020 programme structure.

This will more clearly and directly incentivise cross-sectoral and cross-disciplinary cooperation. Clear objectives and a clear rationale will be established at the mission's inception (addressing a specific weakness identified in the focus areas approach) in order to define targets, clear time-bound goals and expected impact. Non-prescriptive calls will underpin the missions, as opposed to the 'top-down' focus areas. Finally, missions will be co-designed with end users and citizens, thus prioritising public engagement and involvement. As is generally accepted, governance regarding the implementation of innovations and technologies "is both inevitable and desirable, helping to develop shared ownership and responsibility of outcomes and risks"
[157](#footnote158)
.

At the implementation stage, missions will be managed by a clearly identified and empowered Mission Board that is responsible and held accountable for their progress and achievements. Governance will be flexible, in order to adapt to changing challenges and to monitor critical issues in real time for the purpose of reaching the final goals. Mission Boards will be involved in co-designing the missions involving stakeholders and the wider public, providing input to the content of the call for proposals and the evaluation of project proposals and in monitoring missions. A mission manager will be appointed for each mission with the task of ensuring that the mission objectives are reached through a portfolio approach. By involving citizens and stakeholders in the definition, selection and monitoring of missions, a sense of urgency and collective commitment will be created while also ensuring societal ownership of the missions
[158](#footnote159)
.

Future missions could accelerate technological, social or industrial change; or they could transform entire systems. One type of missions could aim to accelerate progress towards a set technical or societal solution, focusing large investment on a specific target with the aim of accelerating the achievement of innovative – often disruptive – solutions (for example, efforts to accelerate market uptake of post Li-ion battery and energy storage solutions). Another type of missions could focus on transforming an entire social or industrial system within an established timeframe, for instance the transformation of the entire energy system or a mobility system in cities (in line with major EU policy goals). The distinctive feature would be a clear and measurable target set from the outset for the complete transition linked to a year of achievement. This overall EU objective would articulate new R&I solutions with regulatory, infrastructure, financial or social initatives initiated outside the future EU R&I programme.

Figure 19 Characteristics of missions that accelerate and missions that transform

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| --- | --- |
| Missions that accelerate    ·Can be scientific, technological, social or industrial  ·More narrowly defined missions that are linked to specific breakthroughs.  ·Targets will aim to speed up developments already in the pipeline (e.g. lifesaving drug to market in 5 rather than 10 years)  ·The cross-sectoral and cross-disciplinary dimension will be important  ·The need to involve coordination with policy and regulation may still exist, but will be less strong than with transformer missions.  ·Relevant targets to be defined by straightforward indicators (xKW per hour for €y by 20XX) or targets (vaccine for malaria by 20XX) | Missions that transform    ·Address European societal challenges: aiming at achieving truly transformative change in how economic sectors and organisations work, and how citizens live.  ·Will contain a number of accelerator missions aimed at achieving related scientific, technological, social or industrial aims  ·Aligned with wider policy and regulatory measures and demand-side stimulus (procurement)  ·Broad coherence with wider European and international policy agenda  ·Require research and innovation achievements, but also changes in regulation and user behaviour.  ·Cover coordinated R&I activities in several sectors, across thematic policies (i.e. energy, transport etc.) and may require public sector innovation, social innovation, behavioural change.  ·The relevant targets will concern broad societal indicators, presupposing a wide uptake of new technologies, products and processes.  ·Strong multi-level governance and coordination is required (EU, national, regional and urban level) |

The success of missions hinges on the timely and due consultation and dialogue with stakeholders, to avoid the risk of disengagement and lack of follow-up. At implementation phase, a challenge will be to ensure that evaluation and monitoring mechanisms can capture the long-term impacts of missions. Finally, the uptake and roll-out of innovative solutions arising from the missions would ultimately be dependent on wider framework conditions – this can be mitigated through policy actions in the spirit of the Innovation Principle or through Innovation Deals
[159](#footnote160)
. A mission-oriented approach in Horizon Europe will thus require new adaptations and learning.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Improved cross-sectoral and cross-disciplinary cooperation. Missions will require expertise from different sectors and disciplines to come together: climate change cannot be fought by the energy sector alone; it will also require changes in transport, nutrition, and in many other areas [160](#footnote161) . Because global challenges are complex and "wicked" [161](#footnote162) , and their solutions imply system transformations [162](#footnote163)  and creating instead of fixing markets [163](#footnote164) , mission-oriented R&I initiatives targeting them must ensure that the many technologies will be developed and deployed across sectors [164](#footnote165) . The mission-oriented approach will work across clusters to promote these system-wide transformations. This is confirmed by the large majority of stakeholders as an appropriate support to mission orientation [165](#footnote166) . |
|  | ·Increased impact on global challenges and EU policy priorities. Missions are expected to be more effective in delivering societal impact for end-users and citizens, because they prioritise investments and set directions to achieve objectives that are relevant for the society. Directionality and intentionality are core features of mission-oriented R&I initiatives, and this differentiates them from other types of policy initiatives like challenge-oriented and systemic policies. Lack of directionality can impede system transformations and lead to the failure of mission-oriented initiatives, as shown by many case studies from across the globe that are driven by urgent societal challenges [166](#footnote167) . In addition, instituting a mission-oriented approach with visible targets is likely to provide a reliable long-term framework incentivising private firms and the public sector to invest in R&I, thus reaping new markets. Public R&I investments have a higher economic impact if they are directed to specific missions, with targets set by policy in close interaction with both  public and private actors [167](#footnote168) . |
|  | ·Decreased gap between science/innovation and society. R&I missions should be easy to communicate, in order to mobilise citizens and end-users in their co-design and co-creation. In turn, this increases the relevance of science and innovation for the society and it would stimulate the societal uptake and deployment [168](#footnote169)  of innovative solutions and leverage business investment. |

2.4What alternatives were considered? 

§Replacing Societal Challenges with missions: an option would be to replace the current seven societal challenges of Horizon 2020 with a similar number of missions, thus for instance having a mission on energy and one on health. This would require large-scale missions that would need to be broad in scope. This alternative was discarded because it is not suitable to meet the operational objectives. Defining broad, large-scale missions entails a significant risk that they would not provide sufficient focus. Furthermore, if missions become very broad there is a risk that the involved stakeholders find it more difficult to feel ownership of the mission. Very broad missions also have the disadvantage that they would be difficult to measure since they would need to cover many different aspects.

§Continue with the Horizon 2020 focus areas: according to the interim evaluation of Horizon 2020, the focus areas in Horizon 2020 have boosted the programme's internal coherence and its capacity to provide interdisciplinary solutions to multiple societal challenges. However, adopting over 20 focus areas with limited overall coordination resulted in confusion among stakeholders. Furthermore, the current strategic programming process for choosing focus areas and priorities for the challenge pillar involves end-users and citizens only to a limited extent. This leads to low awareness and acceptance of R&I driven societal transformation. Because the focus areas are virtual and do not always have clear objectives, they do not provide the necessary impetus to set the direction for public and private actors.

§Accelerator-type missions only: this alternative would imply that the 'Global Challenges' pillar would allocate funding exclusively to future accelerator missions. Each call in the challenge pillar programme would focus on one clear scientific, technological or industrial mission, with a clearly defined target and timeline to achieve it. The lack of focus on entire systems means that the transformative potential of accelerator missions would be smaller compared to transformer missions, which could mean not delivering on EU strategic challenges, contributing to EU policy-making and increasing cross-sectoral and cross-disciplinary cooperation. Furthermore, the accelerator missions would often be less relatable to citizens.

§Transformer-type missions only: under this scenario, the Challenges pillar would be structured to invest in future transformer missions, with a very large funding allocation. In the EU framework programme for R&I each call in the challenge pillar would be defined as a transformer mission, contributing to the overall EU policy agenda and a sustainable development. The complexity of transforming entire systems entails a fairly high risk of not reaching the set mission, which could lead involved stakeholders to find it more difficult to see exactly what their role would be.

More widely, if the Global Challenges pillar only is implemented via missions, many of the current topics and calls that address specific policy needs could not be implemented since they do not require a large-scale intervention. Furthermore, many current R&I areas would no longer be tackled leading to a significant decrease in the capacities in these areas. This would make it difficult to pave the way for new missions in areas not covered by current ones.

2.5How will the mission-oriented approach be implemented?

Only a part of the Global Challenges pillar would be implemented through missions, thus leaving room to operate more 'traditional' calls for proposals as in Horizon 2020. Future missions will often cut across the different programme parts for collaborative research, and thus they will require flexibility in implementation.

|  |  |
| --- | --- |
|  | §Co-creation of potential missions with Member States, stakeholders, citizens and other actors will be a key part of the strategic programming process, while the choice of missions should be adaptable to future needs and policy priorities at EU level.  §Aligned with the guiding principles of Responsible Research and Innovation in ensuring that governance of science is fully transparent, citizens will thus be involved in the priority-setting of the missions.  §Missions will define the expected impact at call level, meaning that the calls for proposals can be more open than is the case in Horizon 2020 work programmes.  §If needed to achieve a particular mission, work will also be carried out to provide input to put in place a proactive regulatory framework that can be conducive to innovation.  §Involvement of end-users could be defined as an award criterion, or alternatively as an eligibility criterion, for project proposals. |

Missions will be implemented using the existing Executive Agencies of the Commission and will largely use the same evaluation criteria as the rest of the Framework Programme. However, some specific features are foreseen as regards the evaluation of proposals under a specific future mission:

·The project proposers should be able to choose the most suitable instrument out of a given toolbox

·When evaluating project proposals under missions higher weighting for contributing to the mission impact could be introduced

·At the level of selecting project proposals, it should be possible to select proposals that are not in the ranking order as established by the evaluators, on the grounds that they are more likely to achieve the mission objectives;

·At the level of project management there should be an option to easily amend/terminate projects

2.6Relevant studies

·Mission-Oriented Research and Innovation: assessing the impact of a mission-oriented research and innovation approach. The Joint Institute for Innovation Policy, Joanneum Research, Tecnalia, TNO, VTT, the Danish Technological Institute, and Valdani Vicari & Associati (2018). 

·Citizen Participation in FP9: A model for mission and work programme engagement. Democratic Society, February 2018.

·Mission-Oriented Research and Innovation in the European Union: A problem-solving approach to fuel innovation-led growth, by Mariana Mazzucato. February 2018.

·Mission-Oriented Research and Innovation Policy: A RISE Perspective, February 2018.

·Towards a Mission-Oriented Research and Innovation Policy in the European Union: An ESIR Memorandum, December 2017.

·LAB-FAB-APP: Investing in the European future we want: Report of the High Level Group on Maximising the Impact of EU Research and Innovation Programmes, July 2017.

·European Commission (2017), Interim evaluation of Horizon 2020, Staff Working Document (SWD).

3International R&I cooperation

3.1Why do we need international R&I cooperation and why should this be done at EU level?

International cooperation in R&I is key to ensure that researchers and innovators in the EU have access to knowledge, knowhow and facilities that lie outside the Union. They need to collaborate with their counterparts worldwide to tackle increasingly interlinked global societal challenges and to ensure that companies in the EU stay competitive. EU-level action can more effectively shape multilateral R&I policy agendas and actions and framework conditions for cooperation.

The increasing scope and interconnectivity of global societal challenges require more international joint R&I action and coordination of R&I agendas. This is also seen in the increasing number of multilateral initiatives that have emerged in the last decade such as the Belmont Forum
[169](#footnote170)
 and Mission Innovation
[170](#footnote171)
, shaping the global R&I policy agenda and coordinating efforts.

With growing dominance of international collaborative research in knowledge production and the emergence of new countries as major R&I players, the EU needs to intensify its access to, and benefits from, the world’s best talents, expertise and resources. Over the last decade, the EU's share of the world's gross expenditures in R&D has dropped from one fourth to one fifth. The EU's share of scientific publications has dropped from one third to one fourth and the EU share of patents has also dropped from one third to one fourth
[171](#footnote172)
.

International cooperation is important to support to the internationalisation of innovative EU companies and their global scale-up, by removing barriers to enter global value chains and foreign markets. International co-invention of patents has increased significantly across almost all technologies over the last decade, and most countries have experienced significant increases in the share of foreign value added in exports and final consumption.

There are clear benefits of intensifying international R&I cooperation at EU level, compared to what can be achieved by Member States alone. Openness of the Framework Programme to third countries enhances the EU added value of the Programme itself, allowing EU participants to collaborate with the best minds in the world. The EU can more effectively shape policy agendas when represented as a single voice in multilateral fora and international organisations. The EU has a comparative advantage as compared to single Member States when negotiating bilateral agreements with third countries regarding framework conditions such as mutual openness of funding programmes or issues related to Intellectual Property Rights (IPR) protection. Thanks to the Framework Programme, Member States are enabled to cooperate with several third countries, including countries with which they do not have bilateral agreements.

|  |
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| What do we have now in Horizon 2020?  Association to the programme is limited to countries geographically close to Europe: Enlargement, EFTA and European Neighbourhood Policy countries, as well as countries already associated to FP7. Legal entities from Associated Countries can participate in actions under the same terms and conditions as entities from Member States.  Legal entities from non-associated third-countries can participate in projects in all parts of the programme, e.g. for mono-beneficiary grants, specific close-to-market innovation activities and actions for access to risk finance.  Third-country nationals are eligible to apply for ERC grants when the host institution is in a Member State or Associated Country. Third-country nationals are eligible for all MSCA actions except for Global Fellowships and for the European Reintegration Panel.  Except for a few cases, only participants from low- and middle-income countries are automatically eligible to receive EU funding. EU funding can be exceptionally granted to other third-country entities whose participation is deemed essential for carrying out an action.  What have we learned from Horizon 2020 Interim Evaluation?  Targeted international R&I cooperation initiatives are needed to pursue strategic cooperation.  Targeted activities are important incentives to attract international engagement. While topics that are particularly relevant for international cooperation correspond to around 25% of all Work Programmes' topics, they attract around 75% of international participation. Moreover, the established co-funding mechanisms with countries that are not eligible for funding have proven more effective in increasing their participation to the programme when combined with targeted activities, such as those with China that have to a high degree restored the initial drop of the country's participation. Much participation from countries eligible for funding is also due to targeted actions.  Association agreement with the programme does not necessarily lead to increased participation.  The programme's highly competitive, excellence-driven nature has led to noticeable disparity in the engagement of associated countries: participation of those with less advanced R&I systems is far more challenging than those with strong R&I systems. On the other hand, policy support, mobility and coordination actions have proven beneficial for some of the underperforming countries. For example, Switzerland, Norway, Iceland, Israel have long-standing participation in the EU Framework Programmes and a very strong performance. For ENP countries, the association has contributed to the integration of their R&I systems in the ERA, despite lack of national capacity needed to fully benefit from their association.  Secured (EU and third country) funding for R&I is an important incentive to attract international engagement.   EU funding has proven to be an important incentive for engaging third countries in the programme. The discontinuation in Horizon 2020 of the automatic funding to organisations from Brazil, Russia, India, China and Mexico caused an important decrease of their participation. Most countries for which the rules of funding remained the same did not experience such a significant drop. Third-country co-funding mechanisms can lead to increased participation. However, effectiveness depends on their implementation and successful communication to potential third-country applicants.  Investing in global multilateral R&I partnerships brings important benefits, but implementation can be improved.  Horizon 2020 shifted towards investing more on programmatic cooperation and multilateral instruments. This has contributed to better international coordination and leverage of investments from other countries. However, there is need for further rationalisation of funding schemes and there is space for improvement in the implementation of EU support to international initiatives. |

|  |
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| What do stakeholders say?  Stakeholder provided the following recommendations for EU support to international R&I cooperation:  ·Strengthen international R&I cooperation in the Framework Programme while encouraging reciprocity.  ·Explore synergies between the Framework Programme and national R&I strategies, structures, instruments and networks to support strategic coordination of international cooperation in the Framework Programme.  ·Use the Sustainable Development Goals to frame large-scale R&I missions and stimulate and steer international R&I cooperation on common global challenges.  ·Organise the Framework Programme to facilitate access to and benefits from talent, knowledge, ideas and markets across the globe.  ·Associate third countries to the Framework Programme based on their excellence in R&I, not confined to one part of the world. |

3.2What do we want to achieve with international cooperation?

International cooperation in R&I is indispensable for effectively tackling global challenges and for implementing global commitments. It will aim at:

|  |
| --- |
| ·Attracting the participation of the world's top researchers, innovators and knowledge-intensive companies. |
| ·Shaping the global R&I policy agenda, in particular for addressing common challenges and for achieving the Sustainable Development Goals. |
| ·Contributing to Europe's efforts to harness globalisation by establishing fairer framework conditions with international partners. |

3.3What changes and what are the expected implications?

International cooperation will be intensified based on the following:

·Extend association to the Framework Programme, beyond EU enlargement, EEA countries and ENP countries, to include all countries with proven science, technology and innovation capacities to make cooperation and funding of joint projects as smooth as possible.

·Intensify support to international large-scale flagship initiatives, partnerships, bilateral and multilateral initiatives and joint programmes and calls, to increase EU access to researchers, knowledge and resources worldwide and optimise benefits from cooperation.

·The programme will continue to fund entities from low-mid income countries, and to fund entities from industrialised and emerging economies only if they possess essential competences.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Improved excellence of the Programme. Attracting and collaborating with the world's top researchers, innovators and knowledge-intensive companies reinforces the EU’s science and technology base. Evidence shows that international collaboration increases the impact of scientific publications [172](#footnote173) . |
|  | ·Higher influence of the EU in shaping global R&I systems. This approach will enhance the EU leading role in setting the policy agenda, in particular for addressing common challenges and for achieving the Sustainable Development Goals. The mutual benefits of international cooperation strengthen EU leadership in the knowledge-intensive economy. The Programme will be an effective instrument in Europe's efforts to harness globalisation by removing barriers to innovation and by establishing fairer framework conditions with international partners. |
|  | ·More impact from the Programme. Increased international cooperation will reinforce EU R&I excellence and the creation and diffusion of high-quality knowledge in the EU. Cooperating internationally is indispensable as the scope and interconnectivity of global societal challenges increase and require more international joint action and coordination of agendas International openness of the innovation eco-systems will strengthen EU competitiveness by promoting a level playing field and enhancing supply and demand of innovative solutions. The association agreements with countries having excellent R&I capacities will facilitate mutual access to European and third-country know-how and markets as cooperation with top third country innovators facilitates access to expertise that is increasingly developed outside the EU. |

3.4What alternatives were considered?

The international dimension of the Framework Programme depends on its openness to association, participation and funding of third countries, as well as the scale of targeted international cooperation actions. Alternatives to a Framework Programme less 'Open to the World' than Horizon 2020 include, for instance, a Framework Programme without targeted actions, which would mean losing opportunities to pursue strategic international cooperation in line with EU priorities; a Framework Programme that would not fund entities from developing countries, which would be damaging since many of these countries play a major role in global efforts on tackling global challenges; and a Framework Programme excluding third-country entities from close-to-market activities, which would hamper prospects of EU-based companies to exploit growing supply of and demand for innovative solutions in new and emerging markets outside Europe.

3.5How will international cooperation be implemented?

|  |  |
| --- | --- |
|  | §The future Programme will be open to association of EU enlargement, EEA countries and ENP countries, as well as other countries with proven science, technology and innovation capacities. The rules governing their financial contribution should ensure a close approximation between payments and returns.  §The Programme will promote and integrate cooperation with international partner countries based on common interest and mutual benefit and identified based on their science and technology capabilities, market opportunities and impact on EU competitiveness, contribution to international commitments, and framework conditions for cooperation.  §The Programme will intensify synergies with EU external policies, e.g. to help build R&I capacity, support diffusion and uptake of innovation, and contribute to the EU's economic and development policy objectives.  §The general opening for participation of entities from all third countries will be maintained, while encouraging comparable reciprocal access to third country programmes.  §The Programme will continue to fund entities from low-mid income countries, and to fund entities from industrialised and emerging economies only if they possess essential competences or facilities.  §Cooperation through strategic targeted initiatives will be reinforced with a wider use of a range of implementation tools:  ­Programme co-funds for supporting international partnerships, multilateral initiatives and joint programmes;  ­Joint, coordinated and twinning calls for bilateral and multilateral cooperation;  ­Calls for proposals on topics of broad scale and scope mandating or strongly encouraging third-country participation. |

3.6Relevant studies

·OECD Science Technology and Industry Scoreboard (2017).

·Science, Research and Innovation Performance of the EU (2016).

·"Global Catastrophic Risks ", Global Challenges Foundation (2017).

·"Rates of return to investment in science and innovation", prepared for the UK Dept. for Business, Innovation and Skills (2014).

·World Intellectual Property Indicators, WIPO (2015).

·European Commission (2016), Analysis of the International Positioning of the EU Using Revealed Comparative Advantages and the Control of Key Technologies.

·“Global Startup Ecosystem Report”, Startup Genome LLC. (2017).

·"EU Industrial R&D investment Scoreboard", EC (2016).

·"Analysis of ERA-NET Cofund actions under Horizon 2020", Expert Group Report (2016).

·LAB-FAB-APP: Investing in the European future we want: Report of the High Level Group on Maximising the Impact of EU Research and Innovation Programmes, July 2017.

·European Commission (2017), Interim evaluation of Horizon 2020, Staff Working Document (SWD).

4Open Science

4.1Why do we need Open Science and why should it be supported at EU level?

Open Science entails a general shift towards a more open, collaborative, data-intensive and networked way of doing research and sharing research results. It supports the early sharing of research outputs in open access modes, empowers the participation of non-academic scientists in the research process (e.g. citizen-scientists), and. promotes an active engagement with the public.

Among stakeholders in Europe and internationally there is a shared understanding of the potential benefits of Open Science and of the fact that Open Science is the direction that research policy should be advancing. EU Member States are gradually establishing strategies for open access and Open Science, and have endorsed politically the transition towards an Open Science system in the Competitiveness Council Conclusions adopted in May 2016.

Open Science contributes to swiftly advancing research and addressing societal challenges, helps fight against unnecessary duplication, non-reproducibility of research, fraud and scientific misconduct. Traditional, closed scientific practices, on the other hand, are obstacles to scientific progress and limit the economic and social impact of science.

Open Science is needed to enhance the efficiency of EU support to R&I by facilitating the circulation and re-use of the excellent research and innovation funded by the Framework Programme. Supporting it at the EU level will accelerate the transition to Open Science in Europe, and its positive effects will be amplified by the wider scale at which they are implemented (e.g. more research data openly accessible leads to less duplication). Moreover, the European Commission already supports through Horizon 2020 Work Programmes the development of the European Open Science Cloud as the underpinning research data infrastructure for Open Science in Europe.

|  |
| --- |
| Challenges |
| Only some two thirds of scientific publications supported by the EU Framework Programme are openly accessible, locking them away from innovative SMEs, interested citizens, and fellow researchers. |
| There is a very large economic potential of opening up access to research outputs (including data) from publicly supported research. The estimated economic return on investment made for the Human Genome project is close to 10. |

|  |
| --- |
| What do we have now in Horizon 2020?  Open access to publications: Open access to publications is mandatory, i.e. self-archiving ('Green OA') only or the combination of open access publishing with self-archiving ('Gold OA' combined with 'Green OA'). Open access publishing is encouraged and relevant costs eligible. Beneficiaries are encouraged by guidelines to keep enough (copy)right to self-archive but are not legally empowered to do so.  Open access to research data: Participation in the Open Research Data Pilot is the default for Horizon 2020 projects, and it requires them to develop a Data Management Plan (DMP). Under specific conditions it is possible to opt out from the Pilot at any stage of the proposal/project. There is no reference to FAIR data (Findable, Accessible, Interoperable, Re-usable). Data is 'as open as possible, as closed as necessary’.  What have we learned from Horizon 2020 Interim Evaluation? What have we learned from Horizon 2020 Interim Evaluation?  While Horizon 2020 has made great progress in terms of making the scientific publications and data it generates openly accessible to the wider scientific community and public, more can be done in this respect. In addition to further efforts for mainstreaming open access and open data practices, much remains to be done to promote broader Open Science practices.  Only ~61-68% of publications funded by Horizon 2020 appear to be actually available in open access. Participation rates in the Horizon 2020 Open Research Data Pilot for the years 2014-2016 were 68% of projects in the pilot’s core areas, with an additional 9% voluntarily opting in (from non-core areas). For 2017, preliminary data indicates a participation rate of 62%. |

|  |
| --- |
| What do stakeholders say?  ·In the context of the Open Science Policy Platform established by the European Commission in 2016, representatives of the main stakeholders have issued detailed and consensual advice on how to further elaborate and implement Open Science policies.  ·Adopting policies towards Open Science is recommended by the RISE high level advisory group for policy development, which supports the Commissioner in setting the policy agenda.  ·Open Science and the significance of open data has been underlined in the G7 Science Communiqué in Turin (September 2017).  ·Research performing organisations increasingly require open access to publications and data resulting from their funding, and incentivise Open Science practices through specific programmes or awards. Increasingly, universities are considering new ways to assess researchers’ careers and requiring new types of research skills from researchers. |

4.2What do we want to achieve with Open Science?

The rather limited progress at the EU level in the transition towards Open Science, including on open access to research outputs, has been identified as one of the specific improvements to be made in the new Framework Programme. A reinforced support to Open Science will contribute to the Framework Programme objectives. More specifically, Open Science will aim at:

·Increasing the circulation of openly accessible high-quality scientific content to stimulate the rapid creation and diffusion of more high-quality scientific information;

·Improving the reproducibility and re-use of research data, and decreasing unwanted duplication;

·Participating in the globalisation of Open Science through G7/G20, GRC, initiatives on research data – both general (RDA) and sector specific, and as an integrated component of multilateral bilateral agreements (e.g. with CERN).

·Increasing and improving the level of openness, transparency and networked collaboration leading to a higher degree of responsiveness of the research community to societal challenges;

·Sponsoring trustworthy and more accessible science from the point of view of citizens and civil society organisations, by engaging with them in the programming and conduct of scientific activities.

·Fostering innovation, in particular among innovative SMEs by facilitating and accelerating access to cutting edge discoveries.

4.3What changes and what are the expected implications?

·The open access mandate for publications will be simplified with more straightforward provisions; enabling conditions will be put in place for authors/beneficiaries to be able to comply with it.

·Open access to research data will be disambiguated from Data Management Plans (DMPs) and emphasis will be placed on sound research data management. While the open data mandate will continue to apply by default but with opting-out possibilities in duly justified cases under the principle 'as open as possible, as closed as necessary', the development and implementation of a DMP will be an obligation for all projects producing data.

·Emphasis will be placed on supporting as much as possible the proliferation of data that is Findable, Accessible, Interoperable and Re-usable (FAIR).

·The Programme will fully embrace and support Open Science as the new research modus operandi.

What are the expected implications?

|  |  |
| --- | --- |
|  | ·Increase the availability of scientific output in open access. A higher percentage of projects will make their outputs (publications, data, algorithms etc.) available in open access because of the simplification of provisions, the stricter formulation of exceptions, and financial support provided through the Programme. |
|  | ·Higher levels of excellent research and innovation. Placing high quality content in the open, and stimulating knowledge diffusion, improves science communication and enables interdisciplinary research. Large bodies of peer-reviewed scientific information will be made available to everyone and across global challenges. |
|  | ·Increased accessibility to high quality digital content. Data are increasingly becoming the starting point for innovation, with high returns. With digitisation, it can be expected that SMEs and other companies will base new business models on digital content, hence will reap the benefits of a strengthened Open data environment in Europe and maximise the exploitation of digital resources through reusability. |
|  | ·Higher societal impact. The Programme will improve reach-out and involvement of citizens in the research process, contributing to building a society based on knowledge and education. Open science allows citizens to be part of the research process (for example through citizen science), helping lifelong learning and developing an informed society for the 21st century challenges. |

4.4What alternatives were considered? 

Alternatives consisting of softer policy or no open access policy were ruled out for a variety of reasons: firstly and most importantly, they do not contribute towards but rather go against the objectives of the Framework Programme for the circulation of knowledge and enhancing open science. Studies show that non-binding funder and institutional open access (as opposed to mandates), lead to limited uptake of the policies.
[173](#footnote174)
 It is therefore to be expected that going back on the requirements of the current policy would result in less uptake than we currently observe (roughly 61% for publications) with all the relevant disadvantages for research, innovation and society described above (cf. section on problem definition). Further, discontinuing an open access policy, or open research data policy, would be against coordinated initiatives of funders and MS described earlier and is not expected to enjoy political support.

4.5How will Open Science be implemented?

|  |  |
| --- | --- |
|  | §Open access will be adapted to the evolving scholarly communication environment. Open access to all scientific publications will continue to be mandatory and requirements will be introduced for beneficiaries to ensure that they or the authors retain sufficient intellectual property rights to ensure compliance with the open access requirements. Early sharing of publications (pre-prints) will satisfy open access requirements. Article Processing Charges will be eligible for purely open access publishing venues (i.e. not 'hybrid' journals)..  §Data Management Plans will be required of all projects producing research data in view of making Data Management an integral part of the research process.   §Open access to research data will be the general rule following the principle 'as open as possible, as closed as necessary'; possibilities for exceptions will be available for duly justified reasons (e.g. concerns related to commercial exploitation, protection of personal data or confidentiality/security).  §Open access to other related research outputs will be promoted (e.g. to software, algorithms).  §Mandatory technical standards will be crafted to ensure that scientific information, publications, data and other outputs, as well as the metadata about them is available for re-use in the long term. This includes the use of persistent and unique identifiers, the use of certified repositories that are compliant to the standards of the European Open Science Cloud; finally, it includes complying to the FAIR principles for the management of research data produced by projects.  §Requirements for recognized good Open Science practices for the entire research cycle will become embedded in select work programmes, depending on the scientific discipline and their particular focus.  §Financial incentives to encourage Open Science practices may be deployed in some work programmes as incentives for full compliance with good Open Science practices. This will also concern training and development for researchers seeking to acquire and improve their skills in Open Science.  §As to rewards for Open Science, a label will be introduced to recognise universities which embody modern, collaborative practices.   §Research integrity will be fully incorporated in guidance documents and likewise the Commission will promote the adaptation of the European Code of Conduct for Research Integrity in order to accompany the support of Open Science. Minimum scientific quality requirements (e.g. publishing research protocols) will also be foreseen.  §In order to build effective co-operation between science and society, funding will be ensured for Citizen Science, as well as dedicated parts of the Framework Programme. Specific Key Performance and Impact Indicators linked to citizen science activities will also be set.  §Combined with qualitative expert assessment, next generation metrics will be used to accurately capture the uptake of Open Science.  §Open Science will be an element to consider in the evaluation of proposals. |

4.6Relevant studies

·Tennant JP, Waldner F, Jacques DC et al. (2016), The academic, economic and societal impacts of Open Access: an evidence-based review. F1000Research 2016, 5:632 (doi: 10.12688/f1000research.8460.3).

·Kittrie E, Atienza AA, Kiley R, Carr D, MacFarlane A, Pai V, et al. (2017) Developing international open science collaborations: Funder reflections on the Open Science Prize. PLoS Biol 15(8): e2002617. 
<https://doi.org/10.1371/journal.pbio.2002617>

·LAB-FAB-APP: Investing in the European future we want, Report of the High Level Group on Maximising the Impact of EU Research and Innovation Programmes, July 2017.

·European Commission (2017), Interim evaluation of Horizon 2020, Staff Working Document (SWD).

  

5European Partnerships

5.1Why do we need research and innovation partnerships at EU level?

Through research and innovation (R&I) partnerships, the Framework Programme since 2002 pools resources between the European Union (EU), the private sector and the Member States to tackle big challenges, support competitiveness and jobs, develop closer synergies with national and regional programmes, and encourage greater public and private investment in research and innovation. Beyond supporting the development of a true European Research Area (ERA), EU-wide partnerships provide EU added value by contributing to the openness and transnational cooperation in R&I in Europe. They also provide leverage and directions for European R&I investments to address common policy objectives.

|  |
| --- |
| What do we have now in Horizon 2020?  Figure 20 Overview of R&I partnerships supported under Horizon 2020, including their implementation modes    Horizon 2020 supports two broad categories of partnerships:  ØPublic-private partnerships (PPP): mainly involving industry, i.e. Article 187 initiatives and contractual PPPs (cPPPs); and  ØPublic-public partnerships (P2P): involving mainly Member States, i.e. Article 185 initiatives, ERA-NET Cofund, European Joint Programming-Cofund (EJP-Cofund) and Joint Programming Initiatives [174](#footnote175) .  In addition it supports other types of partnerships through the Future and Emerging Technologies (FET) Flagships and the Knowledge and Innovation Communities of the European Institute of Innovation and Technology (KICs).  What are the criteria for the identification of R&I partnerships under Horizon 2020?   Public-private partnerships (Article 25 of Horizon 2020 Regulation)  1. Horizon 2020 may be implemented through public- private partnerships where all the partners concerned commit to supporting the development and implementation of pre- competitive research and of innovation activities of strategic importance to the Union's competitiveness and industrial leadership or to addressing specific societal challenges. Public- private partnerships shall be implemented in such a way that full participation of the best European players is not impeded.    2. The involvement of the Union in public-private partnerships shall make use of the pre-existing and lean governance structures and may take one of the following forms:  (a) financial contributions from the Union to joint undertakings established pursuant to Article 187 TFEU under the Seventh Framework Programme, subject to the amendment of their basic acts; to new public-private partnerships established pursuant to Article 187 TFEU; and to other funding bodies referred to in points (iv) and (vii) of point (c) of Article 58(1) of Regulation (EU, Euratom) No 966/2012. This form of partnerships shall only be implemented where the scope of the objectives pursued and the scale of the resources required justify it taking full account of the relevant impact assessments, and where other forms of partnerships would not fulfil the objectives or would not generate the necessary leverage;  (b) contractual arrangements between the partners referred to in paragraph 1, which specify the objectives of the partnership, respective commitments of the partners, key performance indicators, and outputs to be delivered, including the identification of research and innovation activities that require support from Horizon 2020.  With a view to involving interested partners, including, as appropriate, end-users, universities, SMEs and research institutions, public-private partnerships shall make public funds accessible through transparent processes and mainly through competitive calls, governed by rules for participation in compliance with those of Horizon 2020. Exceptions to the use of competitive calls should be duly justified.  3. Public-private partnerships shall be identified and implemented in an open, transparent and efficient way. Their identification shall be based on all of the following criteria:  (a) the demonstration of the added value of the action at Union level and of the choice of the instrument to be used;  (b) the scale of impact on industrial competitiveness, job creation, sustainable growth and socio-economic issues, including societal challenges, assessed against clearly specified and measurable objectives;  (c) the long-term commitment, including a balanced contribution from all partners based on a shared vision and clearly defined objectives;  (d) the scale of the resources involved and the ability to leverage additional investments in research and innovation;  (e) a clear definition of roles for each of the partners and agreed key performance indicators over the period chosen;  (f) complementarity with other parts of Horizon 2020 and alignment with the Union research and innovation strategic priorities, in particular those of the Europe 2020 strategy.  Where appropriate, complementarity between priorities and activities and the involvement of Member States shall be ensured in public-private partnerships.  4. The research priorities covered by public-private partnerships may, where appropriate, be included in regular calls in Horizon 2020 work programmes, in order to develop new synergies with research and innovation activities of strategic importance.  Public-public partnerships (Article 26 of Horizon 2020 Regulation)  Horizon 2020 shall contribute to the strengthening of public-public partnerships, as and when appropriate, where actions at regional, national or international level are jointly implemented within the Union. Particular attention shall be paid to Joint Programming Initiatives between Member States. Joint Programming Initiatives receiving support from Horizon 2020 shall remain open to the participation of any Member State or associated country.  Public-public partnerships may be supported either within, or across, the priorities set out in Article 5(2), in particular through:  (a) an ERA-NET instrument using grants to support public- public partnerships in their preparation, establishment of networking structures, design, implementation and coordination of joint activities, as well as Union topping-up of no more than one joint call a year, and of actions of a transnational nature;  (b) Union participation in programmes undertaken by several Member States in accordance with Article 185 TFEU where the participation is justified by the scope of the objectives pursued and the scale of the resources required.  For the purposes of point (a) of the first subparagraph, top-up funding shall be conditional on the demonstration of the added value of the action at Union level and on prior indicative financial commitments in cash or in kind of the participating entities to the joint calls and actions. One of the objectives of the ERA-NET instrument may, where possible, be to harmonise rules and implementation modalities of the joint calls and actions. It may also be used in order to prepare for an initiative pursuant to Article 185 TFEU.  For the purposes of point (b) of the first subparagraph, such initiatives shall only be proposed in cases where there is a need for a dedicated implementation structure and where there is a high level of commitment of the participating countries to integration at scientific, management and financial levels. In addition, proposals for such initiatives shall be identified on the basis of all of the following criteria:  (a) a clear definition of the objective to be pursued and its relevance to the objectives of Horizon 2020 and broader Union policy objectives;  (b) indicative financial commitments of the participating countries, in cash or in kind, including prior commitments to align national and/or regional investments for transnational research and innovation and, where appropriate, to pool resources;  (c) the added value of the action at Union level;  (d) the critical mass, with regard to the size and the number of programmes involved, the similarity or complementarity of activities and the share of relevant research they cover;  (e) the appropriateness of Article 185 TFEU for achieving the objectives.    Proposals for Article 185 initiatives shall be identified on the basis of all of the following criteria:  a)a clear definition of the objective to be pursued and its relevance to the objectives of Horizon 2020 and broader Union policy objectives;  b)indicative financial commitments of the participating countries, in cash or in kind, including prior commitments to align national and/or regional investments for transnational research and innovation and, where appropriate, to pool resources;  c)the added value of the action at Union level;  d)the critical mass, with regard to the size and the number of programmes involved, the similarity or complementarity of activities and the share of relevant research they cover;  e)the appropriateness of Article 185 TFEU for achieving the objectives.  Other partnerships – EIT Knowledge and Innovation Communities (EIT Regulation and SIA)  The European Institute of Innovation and Technology selects and designates partnerships into Knowledge and Innovation Communities according to the priority fields and time schedule defined in the EIT Strategic Innovation Agenda. This selection and priority-setting process is governed by the EIT Regulation [175](#footnote176) . |

The interim evaluations of Horizon 2020-supported partnership initiatives show how effective they are in leveraging significant additional private and public funding and in aligning R&I priorities across Europe.

Public-public partnerships under Article 185, e.g. Eurostars2, European and Developing Countries Clinical Trials Partnership 2 (EDCTP2) have created long-term R&I partnerships and networks between research funders and governments, thus contributing to the European Research Area (ERA). They mobilise significant investment in transnational research projects in important policy areas, with an increasingly global action remit. The key strength for all public-private partnerships under Article 187, e.g. CleanSky2 JU, Bio-Based Industries (BBI JU), is their ability to engage and leverage strategic industry partners in priority areas of action for the Union, across borders and business sectors, and their direct contribution to competitiveness and EU policy goals. They link activities across the innovation cycle, and help overcome fragmentation in their respective sectors by creating long-lasting precompetitive collaborative networks that bring together previously unrelated stakeholders. Contractual PPPs, e.g. Factories of the Future (FoF), Energy-efficient Buildings (EeB), were found to have broadly achieved their goals, being flexible and efficiently managed, bringing together major industrial partners in EU-driven strategies, with mutual understanding of deliverables by industry and a high level of transparency, and openness in participation, including of SMEs. The KICs of the EIT succeeded in creating a portfolio of nearly 250 supported star-ups and scale-ups and were able to raise nearly 300 M€ of equity investments.  

|  |
| --- |
| Challenges |
| Need to rationalise the European R&I partnerships landscape  There are so far close to 100 different R&I partnerships, of which around 80 Public-Public Partnerships, in Horizon 2020. Multiple partnership structures and networks are established without clear exit strategies for the EU funding. This results in the risk of a static system that gives preference to the continuation of existing partnerships without self-sustainability, instead of creating opportunities for new ones of greater relevance. |
| Need to improve the openness and transparency to launch future European R&I partnerships  Smaller actors and R&D less-intensive countries and regions often do not have necessary (human) resources to participate on equal terms. 46 % of Horizon 2020 funding in Joint Undertakings goes to 3 Member States and 18% of PPP funding go to SMEs (23% in the case of cPPPs). This is a barrier for a more optimal and inclusive participation of all types of stakeholders, favouring rather closed incumbents networks from a limited number of countries and hampering the diffusion of knowledge across borders, sectors, disciplines and along the value chain. |
|  |
| Need to link European R&I partnerships to future EU R&I missions and strategic priorities  There is limited coherence between R&I partnerships within certain thematic fields (including obvious thematic overlaps) and between the R&I partnerships and priorities of the Framework Programme: This tends to favour partnerships which have a strong political support, without ensuring a selection towards partnerships with the highest impact probability in complementarity with actions of the Framework Programme. |

|  |
| --- |
| What have we learned from evaluations on the areas for improvement for R&I partnerships?  The Horizon 2020 Interim Evaluation concludes that the overall partnership landscape has become overly complex and fragmented. While the overall number of R&I partnerships in Horizon 2020 is about 100, they represent on average about 25% of the available Horizon 2020 budget with PPPs (cPPPs and JTIs) accounting for about 17.5% of the Horizon 2020 budget. The interim evaluation identifies the need to rationalise the overall European research and innovation partnership landscape, improve their openness and transparency, and link them with future EU R&I missions and strategic priorities.  The Article 185 evaluation finds that the EU public-to-public cooperation (P2P) landscape has become crowded, with too many similar initiatives working with insufficient coherence among the P2Ps, as well as between the P2Ps and Horizon 2020.  The Article 187 evaluation points out that Public-Private Partnership (PPP) activities need to be brought more in line with EU, national and regional policies, and calls for a revision of the Key Performance Indicators.  The contractual PPPs (cPPPs) review identified challenges of coherence among cPPPs and the need to develop synergies with initiatives such as KICs.  The EIT evaluation identifies the need to develop further synergies with other EU initiatives (at programming and implementation level) such as other parts of Horizon 2020 and the thematic smart specialisation platforms (TSSPs), funded through the Structural funds. |

5.2What do we want to achieve with a new approach to European R&I partnerships?

The objective for the use of partnerships under Horizon Europe is to improve substantially the quality and impacts of R&I investments in Europe by supporting more coherent and integrated use of public and private investments at programming level.

A more effective and smarter use of Partnerships requires a more strategic and ambitious approach that is impact-oriented and ensures complementary with the Framework Programme, with the Commission as active facilitator for selection and set-up of partnerships. A revised approach for R&I partnerships aims at:

·Preparing for a new generation of R&I partnerships based on common guiding principles and an objective- and impact driven intervention logic in order to achieve impacts from EU funding that cannot be achieved with other action under the Framework Programme or national action alone;

·Setting and applying clear criteria for the establishment, implementation, monitoring and phasing out of partnerships under the Framework Programme, including clear exit strategies thus contributing to a rationalisation of the European R&I partnership landscape;

·Catalysing a more open and integrated use of public and private R&D investments on common EU strategic priorities, in particular future R&I missions and EU strategic priorities;

·Ensuring more participation of different types of stakeholders from different countries and regions in R&I partnerships.

5.3What changes and what are the expected implications?

An overall R&I partnership strategy based on an objective- and impact driven intervention logic will be developed and implemented in order to ensure that R&I partnerships are established only in cases where impacts need to be created that cannot be achieved by other Framework Programme's action or national action alone. The strategic planning process of the Framework Programme will frame the establishment of European Partnerships. This will ensure that the next generation of partnerships will support agreed EU priorities and will lead to a rationalised R&I landscape, with fewer, but more targeted initiatives receiving co-funding/investment from the Framework Programme. All future European Partnerships will be designed on the basis of the same guiding principles of Union added value, transparency, openness, impact, leverage effect, long-term financial commitment of all the involved parties, flexibility, coherence and complementarity with EU, national, regional and international initiatives.

The design and implementation of future European Partnerships will include an improved coherence between Framework Programme’s actions and R&I partnerships, as well as among initiatives. In addition, communication and outreach will be strengthened by a clear, easy-to-communicate architecture under the umbrella term “European Partnerships”. This encompasses all Partnerships with Member States, Associated or Third Countries and/or other stakeholders such as civil society/foundations and/or with industry (including small and medium sized enterprises), with greater openness to international cooperation. European Partnerships will only be developed on agreed EU policy priorities in the context of the Framework Programme, and subject to the commitment of partners to align their own investments, programmes and priorities, and will be limited in time with clear conditions for phasing out from the Framework Programme funding.

There will be only three types of intervention modes (i.e. several Horizon 2020 labels like P2P, PPP, ERA-NET, FET Flagship and cPPP will be discontinued):

I)co-programming between the EU, Member States, and/or other stakeholders, based on Memoranda of Understanding or contractual arrangements with partners;

II)co-funding of R&I activities, based on a single, flexible programme co-fund mechanism;

III)institutionalised partnerships (based on Art. 185 or 187 TFEU, EIT regulation for KICs).

  

Table 15 European Partnerships – a simplified implementation for more impact

|  |  |  |  |
| --- | --- | --- | --- |
|  | Co-programmed European Partnerships | Co-funded European Partnerships | Institutionalised European Partnerships |
| Objective | To encourage public and private stakeholders to co-programme, co-invest and coordinate their R&I priorities together with the Commission | To provide EU support to a joint programme of public and/or private stakeholders to tackle EU strategic priorities through research and innovation | To commit in the long-term for shared investments in research and innovation with public and private stakeholders in key strategic areas with international visibility and impact |
| Coverage of FP support | Parts of the FP work programme largely defined by the partners but implemented through FP rules | Co-funding and policy collaboration between the EU, Member-States/ associated countries and other private non for profit organisations such as foundations to achieve impacts that FP action alone cannot achieve | EU commitment for shared investments with public and private stakeholders based on individual legal acts. |
| Changes compared to schemes existing under Horizon 2020 | Replaces cPPP | Replaces ERA-NETs, EJP, FET Flagships | Art 185 of the Treaty on the Functioning of the European Union (TFEU): institutionalised public-public partnerships  Art 187 TFEU: institutionalised public-private partnerships |
| Thematic coverage | Delivering on FP global challenges and R&I missions across the whole FP | | |
| Target groups | Member States, industry (including small and medium sized enterprises) and civil society organisations/foundations | | |
| Changes in priority setting process | Only developed on agreed EU priorities in the context of the FP, based on pre-defined criteria | | |
| Changes in implementation mode | Memoranda of Understanding and/or contractual arrangements  FP contributions for coordination costs through the Work Programme (incl. comitology), e.g. through Coordination and Support Actions | Cofund actions implemented through the Work Programme (incl. comitology) conditional to partners fulfilling their commitments and obligations. More flexibility in support for joint actions, including financial support to third parties in the form of grants, prizes and investments/loan guarantees. | Art 187: Implemented via a Council Regulation  Art 185: Implemented via a Decision by European Parliament and Council |
| Changes in governance model | An overall 'strategic coordinating process' will advise on selection, implementation, monitoring and phasing out of future European Partnerships as part of the overall strategic programming process for the Framework Programme. | | |

What are the expected implications?

|  |  |
| --- | --- |
|  | ·More coherence and better impacts through limited number of partnerships with clear intervention logics and fully applied criteria for establishment, implementation, evaluation and phasing-out. The new generation of R&I partnerships, both renewed and new ones, will be based on a clear rationale for the use of R&I partnerships, the elaboration of distinct and clear intervention logics based on policy objectives and the application of an impact-based criteria framework along the life cycle of R&I partnerships, including their phasing-out. This revised policy approach will lead to a smaller number of R&I partnerships and thus improve the overall coherence and readability of the European R&I ecosystem. The toolbox will be simplified with three types of intervention under the umbrella “European Partnerships”: co-programming of R&I agendas; co-funding of research and innovation activities between the EU and public and private stakeholders to deliver on EU strategic priorities; institutionalised R&I partnerships under Article 185 and Article 187 TFEU, respectively.  The main implications besides an overall smaller number of European Partnerships will be that more public and private R&I investments in Europe will be directed towards commonly shared European policy objectives, thus reducing the R&I related risks for business and strengthening the societal impacts stemming from R&I investments in Europe. The strengthening of cross-border R&I cooperation within European Partnerships will have positive implications for the excellence of the European science system and contribute to the deepening of the single market for knowledge based activities. |
|  | ·More openness and flexibility through partnerships open to all types of stakeholders (Member States, civil society/foundations and industry, including small and medium sized enterprises) with no entrance barriers for newcomers, smaller R&I players. The future generation of R&I partnerships will respond better to the needs and priorities of all EU Member States and other stakeholders, notably industry and foundations. Overall openness will be strengthened by a more strategic and revised policy approach, closely linked to the overall strategic programming of the Framework Programme. Flexibility will be encouraged with the simplified toolbox and a life cycle based planning and implementation approach.  The main implications will be that more Member States and more stakeholder groups, in particular foundations will be active partners in the European Partnerships. A broader set of joint actions beyond joint calls between the partners will substantially increase the flexibility of the partnership initiatives according to the specific needs and objectives and thus increase impacts, in particular policy and societal impacts. |
|  | Enhance impact and visibility of EU R&I funding. R&I partnerships have the potential to substantially expand the impacts of EU R&I funding by leveraging additional R&I investments on EU priorities, by providing 'directionality' to public and private R&I investments and by reaching out to broader stakeholders thus improving the uptake of innovative solutions and enhance the visibility of the Framework Programme. The future design of R&I partnerships will ensure that these potentials for additional impacts will be exploited by encouraging a broader scope of joint activities, by ensuring clearer intervention logics for the use of R&I partnerships and by encouraging more open participation pattern in R&I partnerships. The main implications will be that the up-take of innovative solutions will be facilitated, both in national/regional policies and in new products and processes. Overall, EU support to partnerships will have quantitative and qualitative impacts on the further completion of the ERA and thus on the quality of Europe's R&I ecosystem. The more strategic use of partnerships on EU level will be echoed at national and industry level and contribute in turn to higher and better commitments from partners and to a better recognition and visibility of EU's R&I policy and support measures. The overall 'absorptive capacity' for uptake of innovative solutions in Europe will be strengthened. |

5.4What alternatives were considered?

Taking into account the stakeholder suggestions on the improvement of the EU R&I partnership landscape, the following policy alternatives have been considered and discarded:

§Discontinuation of EU R&I partnerships. Support to any kind of partnerships in the future Programme would be discontinued.

§Continuation of approach to partnerships as implemented under Horizon 2020. The forms and criteria for establishing EU R&I partnerships under Horizon 2020 would continue to exist. The development of a more coherent and strategic partnership approach would not be addressed, as transaction costs and potential impacts are assessed as being not balanced. Still, a substantive part of the available budget of the Framework Programme (between 25-40% according to Horizon 2020 experience) would be "locked" in continuing existing partnerships. The scope of activities would continue to be largely limited to the implementation of joint calls and the management of corresponding transnational R&I projects. The existing partnerships would be mostly continued and their growing maturity would raise the risks of a rather closed set of beneficiaries with limited openness and transparency.

§Simplification: limitation of EU R&I partnerships to coordination. The EU R&I partnership landscape would be simplified by limiting the number of different forms of partnerships. Two sub-alternatives were identified:

a) Only coordination actions: 'Coordination and support actions (CSAs)' would be used to facilitate and catalyse the alignment of national and/or industry related R&I programmes in Europe. In contrast to the second alternative, this would be organised in a competitive way and not linked to the strategic priorities of the EU Framework Programme . This new approach would facilitate the emergence of new networks and topics to addressed in a coordinated way and have a stronger impact on the overall 'openness' of national and/or sectorial R&I systems.

b) Only joint co-funding: the EU Framework Programme would co-fund joint efforts by Member States and/or industry sectors in a small number of overall EU priorities, clearly linked to the priorities of the Framework Programme. On the other hand, the EU Framework Programme would discontinue support coordination of national and/or sectorial R&I priorities. As a result, the number of co-funded R&I partnerships would decrease and thus the complexity of the partnership landscape. The focus of co-funding on the priorities of the Framework Programme would substantially improve the strategic positioning of the R&I partnerships in the overall priorities of the Framework Programme and thus the coherence and complementarity between the direct EU action and the corresponding partnerships. The mandatory co-funding, following largely the rules for participation of the Framework Programme, might however discourage industry and other private non-for-profit stakeholders such as foundations, to participate in the R&I partnerships, as they prefer an administratively simple and relatively fast cooperation framework.

§Maximising EU R&I Partnerships. Partnerships would be used as default option for Framework Programme implementation with direct funding as exception.

All alternatives presented are legally feasible, as they are covered by the TFEU and would not require additional new legislative action (except for articles 185/187 TFEU initiatives). The technical feasibility of the alternative 4 'Maximising EU R&I partnerships' is regarded as limited as it would require a complete overhaul on the currently applied and tested priority setting procedures for the next Framework Programme. The political feasibility to discontinue support is regarded as very low, as political resistance in Member States and by industry would be high. The coherence with other EU policy objectives is for the two policy alternatives 'discontinuation' and 'maximising partnerships' limited, as the potential of R&I partnerships to address broader EU policy objectives, notably growth and competitiveness and tackling global challenges jointly, would not fully be used.

5.5How will the revised research and innovation partnerships be implemented?

|  |  |
| --- | --- |
|  | In order to implement the changes the following elements need to be developed:   §The establishment of European Partnerships framed by the strategic planning process of the Framework Programme to ensure delivery on agreed EU strategic priorities;  §The development and use of an objective- and impact-based criteria framework along the life cycle of European Partnerships - developed together with Member-States - for the selection, implementation, monitoring, evaluation and phasing out of European Partnerships ;  §New modes of governance for European Partnerships, in order to ensure the value, Union visibility and outreach of all European Partnerships. |

The revised approach to European Partnerships will limit them to three different types:

a) Co-programmed European Partnerships:

ØThis mode is the simplest, fastest and least bureaucratic in implementation, with the legal basis for the European Partnerships being political Memoranda of Understanding (MoU)/ contractual arrangements with public and/or private partners (extended cPPP model), specifying the objectives of the partnership, related commitments for financial and/or in-kind contributions of the partners, key performance and impact indicators, and outputs to be delivered and comitology for the respective contributions from the Framework Programme;

ØThe MoU specifies the partners' commitment to invest in the area and coordinate programmes and activities. They implement their programmes, activities and investments under their responsibility;

ØThe Commission implements its part in the Work Programme with calls for proposals, based on indicative commitments for ring-fenced budgets. In addition, if necessary, the coordination between partners can be supported via the standard instrument, i.e. the Coordination and Support Action.

b) Co-funded European Partnerships:

ØThis implementation mode will be applied if the integration of all activities in a single programme is necessary to achieve the objectives;

ØThe legal basis will provided under the respective Work Programme (comitology), providing Framework Programme funding for Programme Cofund actions (simplified instrument, open also to civil society organisations such as foundations);

ØIt will be used to co-fund the European Partnerships for the implementation of a joint programme of activities, based on the commitment of the partners for financial and in-kind contributions and integration of their relevant activities;

ØThe initiatives will be implemented on the basis of Annual Work Plans, subject to the approval by the Commission Services as part of their supervision of the grant agreement. The programme of activities may support networking and coordination, research, innovation, pilot and market deployment, training and mobility, awareness raising and communication, dissemination and exploitation, or a combination thereof, directly implemented by those entities or by third parties to whom they may provide financial support in the form of grants, prizes, procurement, as well as financial instruments such as investments or loan guarantees.

c) Institutionalised European Partnerships
[176](#footnote177)
:

ØThis implementation mode, based on Article 185 and 187 of the TFEU, is the most complex in preparation and will be implemented in cases required by the Treaties and where a political validation outside the comitology is necessary via a Council Regulation (or Decision by EP and Council, for Article 185 TFEU initiatives), and where other forms of European Partnerships would not fulfil the objectives or would not generate the necessary expected impacts, and if justified by a long-term perspective and high degree of integration including central management of all financial contributions;

ØThe legal basis is the respective basic act, the delegation agreement with a Dedicated Implementation Structure or Joint Undertaking, and Annual Work Programmes, as requested by the Financial Regulation and Financing Decisions requiring Commission Decision.

5.6Relevant studies

·European Commission (2017), Interim evaluation of Horizon 2020, Staff Working Document (SWD).

·European Commission (2017), Participation of the EU in research and development programmes undertaken by several Member States based on Article 185 of the TFEU, Staff Working Document (SWD).

·European Commission (2017), Interim Evaluation of the Joint Undertakings (JUs) operating under Horizon 2020, Staff Working Document (SWD).

·European Commission (2017), Interim evaluation of the European Institute of Innovation and Technology (EIT), Staff Working Document (SWD).

·European Commission (2017), LAB – FAB – APP: Investing in the European future we want, Report of the independent High Level Group on maximising the impact of EU Research & Innovation Programmes.

·European Commission (2017), FET Flagships – Interim evaluation.

·European Commission (2017), Mid-term review of the contractual Public Private Partnerships (cPPPs) under Horizon 2020, Report of the independent expert group.

·European Parliament (2017), REPORT on the assessment of Horizon 2020 implementation in view of its interim evaluation and the Framework Programme 9 proposal.

·European Research Area and Innovation Committee (ERAC) (2017), ERAC Opinion on the Interim Evaluation of Horizon 2020 and preparations for the next Framework Programme.

6Strengthening the European Research Area - Sharing excellence

6.1Why do we need to share excellence and why should it be supported at EU level?

The Framework Programme is based on excellence and every entity, regardless its origin, can benefit from the Programme as long as all the criteria are met. While pockets of scientific excellence exist in all EU countries, they are scattered. Moreover, despite serious efforts deployed at national and European level, disparities in terms of research and innovation performance persist among EU Member States, as confirmed by the European Innovation Scoreboard 2017
[177](#footnote178)
. The ERA Progress Report 2016
[178](#footnote179)
 also concluded that large disparities, both in performance levels as in growth rates between countries in the field of research and innovation exist and that there is still much room for further progress on European Research Area (ERA).

Different analyses
[179](#footnote180)
 agree on a number of reasons for these disparities, the most important being: 1) low national and regional R&I investments; 2) insufficient creation and diffusion of high-quality knowledge and innovation; 3) insufficient connectivity and visibility and international cooperation; 4) inadequate R&I framework conditions; 5) sub-optimal functioning R&I systems; 6) low involvement and information of beneficiaries and lack of skills in participating in Framework Programmes.

Additional obstacles
[180](#footnote181)
 often highlighted are information and language barriers; lack of research networks; lack of leading Universities and Research organisations leaders in proposal matters; weak training in preparing successful proposals and in project management; little experience in cross‐country cooperation; generally low focus on R&I in policy and in business; few options for exploitation of research results at the national level. Furthermore, there is a cognitive distance
[181](#footnote182)
 between the scientific and technological portfolio of prospective participants from the countries which joined the EU after 2004 (EU13) and the portfolio of the more successful EU15 and prospective participants from the EU13 are not good enough relative to the EU15. Both the Horizon 2020 interim evaluation and other studies highlight that, while EU13 have lower rate of participation and success compare to EU15, the dichotomy is not so clear and the two groups are not homogeneous in their inside. In addition, the problems are not specific to all the EU13, nor absent from the EU15 countries.

|  |
| --- |
| What do we have now in Horizon 2020?  Horizon 2020 introduced three specific measures addressed to low R&I performing Member States: teaming (institution-building), twinning (networking institutions), ERA Chairs (bringing excellence to institutions).  Additionally Horizon 2020 provides funding for the Policy Support Facility (PSF) – tailor-made services to reform national R&I systems and COST (Cooperation in Science and Technology) – European intergovernmental framework to promote networking.  Widening National Contact Points network is also supported in its endeavour to promote spreading excellence and widening calls and build the skills by organising brokerage events, workshops and conferences.  What have we learned from Horizon 2020 Interim Evaluation?  The interim evaluation of Horizon 2020 provides evidence that participation of low R&I performing countries remains low in absolute terms. However, taking into account the size of the population, the number of researchers and national investments in R&D the performance differences are more nuanced and the targeted countries are affected by these problems in various intensity. Moreover, there are clear performance differences and heterogeneity among the EU13 countries and across Horizon 2020.   The current actions have demonstrated already a positive impact: ERA Chair and Twinning projects already resulted in substantially increasing the attractiveness of the institution for international excellent researchers, the capability of the institution to compete for international funding. Teaming, whose second phase related to the creation of centres of excellence, has started in February 2017, has already leveraged significant amounts of Structural funds, as proposers were expected to mobilise from national/regional public. COST actions demonstrated effectiveness in including excellent researchers from low R&I performing countries with a steadily increasing participation rate. The recurrent feedback on the Policy Support Facility work received from national policy-makers and stakeholders has shown that the operational recommendations formulated by leading experts and policy practitioners prove valuable as catalysers of national R&I reforms. |

|  |
| --- |
| What do stakeholders say?  Stakeholder provided the following recommendations for EU support to sharing excellence:  ·synergies with ESI funds and ring-fenced budget dedicated to “spreading excellence” objective,  ·continued support to teaming, twinning, ERA-Chairs, COST, NCP networks, EIT Regional Innovation scheme (EIT RIS),  ·targeted measures to promote pockets of excellence in low R&I performing countries .  Stakeholders input was used to improve activities addressed to low R&I performing countries set up in Horizon 2020. |

6.2What do we want to achieve with the sharing excellence strand?

The overriding goals of consolidating the Spreading Excellence and Widening Participation actions under Horizon 2020 is to reinforce EU R&I capabilities through the creation and diffusion of high-quality knowledge, by sharing and connecting excellence across Europe and increasing cross-sectorial, cross-disciplinary and cross-border cooperation.

The Sharing Excellence strand will aim at:

§Helping in creating new or upgrading existing centres of excellence;

§Strengthening a defined filed of research by linking entities with different experience in the area with internationally-leading research institutions;

§Helping in attracting and maintaining excellence in the institution;

§Stimulating networking and cooperation between researchers from targeted countries and well R&I performing countries.

6.3What changes and what are the expected implications? 

Following the results of the interim evaluation of Horizon 2020 and stakeholder views, the main set of activities launched in Horizon 2020 under a part called "Spreading Excellence and Widening Participation" will be kept with a few changes following the structure of the Framework Programme, changing R&I landscape in the targeted countries and importance of the issue. The title of these activities becomes Sharing Excellence.

In Horizon Europe, the Sharing Excellence strand, with four key activities (Teaming, Twinning, ERA Chairs, COST), is included in the "Strengthening the European Research Area" part. The Sharing Excellence activities are focused on addressing disparities in R&I performance in targeted countries. The second strand (i.e. Reforming and Enhancing the European R&I system) is open to all the EU Member States and focuses on reforms and enhancement of the European R&I system and institutional changes in research funding and performing organisations including universities, citizen science, gender as well as implementation of the Programme.

For Teaming, Twinning and ERA Chairs under Sharing Excellence a dedicated indicator will be used to identify low R&I performing countries; only constituencies from these countries and from Outermost Regions would be eligible as coordinators
[182](#footnote183)
.

Taking into account importance of sharing excellence across Europe, as well as existing support in Horizon 2020 “Spreading excellence and widening participation” mechanisms, the budget of this strand will be ring-fenced and increased in comparison to Horizon 2020.

Following the Horizon 2020 interim evaluation, stakeholders views and the feedback received from coordinators and reviewers of current Teaming, Twinning and ERA Chairs projects, there are several issues which improve these three instruments under the Framework Programme:

·Sustainability: To address the sustainability during the project implementation, specific arrangements could be considered (e.g. COFUND to allow better combination and exploitation of synergies between the Framework Programme and structural funds. To address the current beneficiaries' concern of ensuring continuity after the project funding is finished, the Framework Programme could require a sustainability plan.

·Preparatory scientific activities: The utility of networking, staff exchanges, expert visits can only reach a certain level, which is why stakeholders recommend supporting preparatory scientific work (i.e. starter kit) under these instruments.

·Strengthen research management: One of the issues coming from the different analyses is the lack of experience with regard to research management and administration in certain countries. There is a need to reinforce the institution building component of these instruments by putting emphasis on the staff preparation and training on proposal preparation and project management.

·For ERA Chairs, following some feedback from implementation so far, it is under consideration to include an Advanced Partner, as it is currently the case for the other “Spreading excellence and widening participation” actions.

COST, under Sharing Excellence, will continue (open to all the countries) while expanding the focus on targeted low R&I performing countries (80% of the COST budget devoted to countries identified as low R&I performing countries). COST will provide opportunities for participation, giving organisations from these countries the opportunity to build experience, accumulate a reputation, and strengthen their network position. The continuation of the COST actions with a higher budget devoted to the targeted countries will address this need and give the opportunity to strengthen collaboration across Europe.

The implications of these changes are the following:

|  |  |
| --- | --- |
|  | ·Better R&I performance. Increasing the excellence of the science base, strengthening knowledge transfer, the innovation creation and diffusion, building knowledge, skills, and co-operation. Tapping into the unexploited research and innovation potential of Member States with a lower R&I performance, increasing their ability to participate in the Framework Programme and integrate the European Research Area and single market will maximise the quantity, quality and impact of R&I investment, benefitting each Member State concerned and Europe as a whole. |
|  | ·More cooperation. Forging cooperation and links across national borders and across sectors, while fostering open science and open innovation practices which help the diffusion of excellence and know-how across the Europe. |
|  | ·Better impacts of R&I investments. Improved quality and impact of R&I systems on productivity, economic growth, job creation and well-being. Although the impact of measures addressed to targeted countries varies across regions, regions from all the Member States are impacted, in some cases with up to 0.18% of GDP [183](#footnote184) . |

6.4What alternatives were considered?

The following options were considered and discarded following the stakeholders' views and interim evaluation of Horizon 2020 results:

·Discontinuation of core measures under a ring-fenced budget and alternative financing for similar actions would be established mainly under the structural funds. With this approach opportunities for overcoming the participation gap and innovation divide by improving connectivity and networking would be missed. The partnering dimension by knowledge circulation between a catching-up and advanced partner would be constrained because the financial support to the advanced partner would require the use of Art. 70 of the ESIF regulation. However, the latter does not fully align with the political objectives of the current Teaming instrument. Twinning with more complex consortia would be even more difficult to implement under this constraint and the continuation of COST networks with on average 27 participants would be also virtually impossible.

6.5How will the this be implemented?

|  |  |
| --- | --- |
|  | Sharing Excellence will be implemented as in Horizon 2020 via calls for proposals. The list of eligible countries will be included in the work programmes. |

  

7Support to policy-making: activities of the Joint Research Centre in Horizon Europe

7.1Why do we need support to policy-making and what is the role of the JRC?

People rightly expect political leaders to be honest with facts when making decisions that impact on their everyday life or their future, especially in an era when the role of scientific evidence, rational enquiry and fact-based conclusions are being challenged as never before. This is why scientific support to policy-making is so important for Europe. EU policies and activities must be based on robust scientific evidence that is transparently formulated, independent of political interests and includes insights from different disciplines and approaches. This will enhance the credibility and legitimacy of those policies, and their impact in addressing our most pressing challenges.

As the science and knowledge service of the European Commission, the JRC contributes to ensuring that policy‑makers have the best available, independent, scientific evidence when taking important decisions that have an impact on EU citizens' daily lives, whether when preparing policies or implementing them. The JRC's research supports priorities of the EU's policy agenda including jobs and economic growth, digital transformation, the Energy Union, the Sustainable Development Goals, civil protection and security, and consumer protection and safety.

|  |
| --- |
| What do we have now in Horizon 2020?  The JRC shall contribute to the general objective and priorities of Horizon 2020 by providing customer-driven scientific and technical support to EU policies, in collaboration with relevant national and regional research stakeholders, where appropriate, while flexibly responding to new policy demands [184](#footnote185) .  The JRC undertakes research and innovation activities, known as "direct actions" and supported by the programme. Around €2 billion of the Horizon 2020 budget is allocated to the JRC, which is approximately 2.5% of the overall programme budget.  What have we learned from evaluations of the JRC?   Ex-post external evaluations of the JRC in previous EU research programmes have consistently rated the JRC's performance, as well as the quality and impact of its scientific outputs, as high, and concluded positively on its effectiveness [185](#footnote186)  Following a key recommendation of the FP7 ex-post evaluation in 2015, the JRC developed a long-term strategy for 2016-2030 and initiated a large number of improvements proposed by the external evaluation panel. The Horizon 2020 interim evaluation report on the JRC, published in July 2017, commended the JRC on the rapid implementation and follow-up of the recommendations made in 2015. [186](#footnote187) |

|  |
| --- |
| What do stakeholders say?  The JRC is a trusted partner in global research and innovation partnership initiatives, including in the framework of the EU-African Union partnership, the UN (work on climate change and on biodiversity), EU institutions (Science for Parliament, and Science for the Regions). In a survey of national and regional authorities, the JRC-operated Smart Specialisation Platforms (which support regional growth in specific priority areas) received a high satisfaction score (4.5/5); it received the Best Practice European Public Sector Award (EPSA Award) in 2017. |

7.2What do we want to achieve with the JRC in the next Framework Programme?

The JRC aims to become a global leader in the creation, management and communication of fit-for-purpose knowledge for public policy, for example through helping to address the concerns raised by the current 'post-fact' debate and leading the campaign for evidence-informed policy.

Whilst retaining its focus on excellent scientific support to policy, the JRC aims to better position and focus its research to address the complex, multi-sectoral societal challenges facing Europe. Another goal is to initiate new ways of bringing the JRC's own research, new open access policy and strategic partnerships tapping into the wealth of knowledge within and outside Europe. This will reinforce the JRC's role as a core provider of high-quality scientific evidence to the Commission. The overall ambition is to enhance the scientific evidence base for, and its use in, policy making, while also enhancing the "responsible research and innovation”
[187](#footnote188)
 agenda in the activities of the JRC.

7.3What will change compared to Horizon 2020 and what are the expected implications? 

The JRC will increasingly co-design its programme of activities with the policy departments of the Commission to maximise the relevance and impact of its activities. The JRC's knowledge and competence centres (see below) will be an important feature of JRC activities post-2020. They are a new way of working across policy areas, scientific disciplines and sectors, bringing together expertise from many Commission departments and the scientific community. They support multidisciplinary research, thereby delivering integrated advice which strengthens the knowledge base required to propose policy recommendations.

New initiatives to extend JRC's collaboration with academia and develop a new generation skilled at the science policy interface, together with a policy of open access to its world class research infrastructure will build closer links to Member States, industry and the scientific community. Member States' and regions' participation in JRC research activities will be promoted via new platforms, such as a proposed set of 'Science4Policy platforms' which would bring the JRC's rich data resources, knowledge, services and networks closer to end-users and citizens.

7.4What alternatives were considered?

Following a key recommendation of the ex-post evaluation of JRC in FP7, the JRC adopted its Strategy 2030 in 2016. The interim evaluation of the JRC, conducted in the context of the Horizon 2020 interim evaluation in 2017, concluded that the JRC should continue to implement this strategy. Alternatives (business-as-usual with the JRC's activities in FP7) were considered when drafting the strategy, but discarded because they would not have adequately responded to the need for more integrated approaches (cross-silo, cross-disciplinary, incorporating social aspects), nor would have enabled an enhanced capacity to respond to emerging challenges and for a broader knowledge base in order to address the increasingly complex policy needs.

7.5How will this be implemented?

The knowledge management strategy will be implemented through better management of scientific knowledge in the process of delivery of evidence for policy-making, and in specific areas through the establishment of Knowledge Centres and Competence Centres.

The JRC has established four Knowledge Centres in the fields of territorial policies, migration and demography, disaster risk management and bioeconomy, which bring together experts and knowledge to inform policy-makers about the status and findings of the latest scientific evidence, and which have already produced innovative tools, such as, the Migration Data Hub used by the Commission and professionals in the Member States. Similarly, JRC Competence Centres have been created which focus on analytical tools and providing services across the Commission, such as, improving quantitative evidence for impact assessments. New knowledge and competence centres will be established, where appropriate.

Finally, the JRC will reinforce its activities in supporting a social Europe by exploring the drivers behind 'fairness' and the resilience of societies. The JRC will also invest in maintaining and further developing its scientific excellence in order to ensure that its scientific advice is based on the best and most robust available evidence.

7.6Relevant studies

·Joint Research Centre Implementation Review 2017: In the context of the Interim Evaluation of Horizon 2020. DG JRC, July 2017.

·Joint Research Centre Strategy 2030. DG JRC, May 2016.

·Strengthening Evidence-Based Policymaking through Scientific Advice. European Commission, DG Research and Innovation, May 2015.

8European Institute of Innovation and Technology (EIT)

8.1Why do we need the European Institute of Innovation and Technology?

The European Institute of Innovation and Technology’s overall mission is to contribute to sustainable European economic growth and competitiveness by reinforcing the innovation capacity of the Member States and the Union. Started in 2009, and since 2014 part of Horizon 2020, the EIT’s specific objective is to integrate the knowledge triangle of higher education, research and innovation and thus to reinforce the Union's innovation capacity and address societal challenges. The EIT is designed to achieve these goals primarily through its Knowledge and Innovation Communities (KICs), which are large-scale European partnerships that operate within specific societal challenges.

From 2010 until 2017 six KICs operated in the fields of:

·Climate Change (Climate-KIC, established in 2010)

·Energy (KIC InnoEnergy, established in 2010)

·Digital (EIT Digital, established in 2010)

·Health (EIT Health, established in 2015)

·Raw Materials (EIT Raw Materials, established in 2015)

·Food (EIT Food, established in 2017).

In January 2018, the EIT launched a new call for the selection of two additional KICs in the field or Urban Mobility and Added-Value Manufacturing. These will be the last two KICs within the Horizon 2020 framework and are planned to be designated in December 2018.

EIT KICs vary in size and have between 50 (recently established KICs) and more than 200 (mature KICs) partners each. Overall there is more than 1000 partners from research, business and education directly involved in operation of current 6 KICs. Each KIC is also organised around a small number of co-location centers that are intended to act as geographical innovation hubs for the practical integration of the knowledge triangle
[188](#footnote189)
. Building on the existing labs, offices or campuses of some of a KICs’ core partners, each co-location center offers a physical location where people and teams from research, business and education meet and work together on common innovation initiatives. This facilitates a trusted face-to-face collaboration across KIC members and serves as a gateway for potential partners. Each co-location center provides regional access to the knowledge, expertise and talent pool of the KIC’s community and carries out education activities.

In particular, each KIC aims at reinforcing innovation capacities by running a portfolio of activities in three areas:

1.Research/ Innovation projects: they encompass a range of activities broadly related to supporting and developing new innovative products, services and solutions that address societal challenges in the KICs areas of activity. Each KIC launches its own research and innovation project portfolio linking universities, research institutes and businesses taking a market-led approach, in order to make solutions market-ready. These projects may comprise demonstrators, pilots or proofs of concept.

2.Education: The development of human capital is supported through a range of innovative educational and training programmes offered by each KIC in the form of post-graduate (MSc/ PhD) programmes, executive/ professional development courses, lifelong learning modules, summer schools and more. The courses are based on a multidisciplinary approach, significant business involvement in the development of learning outcomes and cross-border mobility. The EIT Label aims to ensure quality and recognition within the EIT Community and beyond.

3.Business creation and support activities: The KICs offer a range of business support services such as start-up and accelerator schemes to help entrepreneurs translate their ideas into successful business. These business support services focus on access to market, access to finance, access to networks, mentoring & coaching. 

EIT KICs engage also in a range of outreach, communication, dissemination and horizontal cross-sectoral activities., In 2014, the EIT has developed the EIT Regional Innovation Scheme
[189](#footnote190)
 to help increase the innovation capacity in areas and regions in Europe not participating in KICs.

The EIT regulation sets out the general objectives and the scope of the EIT’s functioning. The EIT's specific objectives, its rationale, EU added value, the broad lines of activity and the EIT's performance indicators are defined in the Horizon 2020 Regulation. The strategic, long-term priority fields and financial needs for the EIT for a period of seven years is laid down in a Strategic Innovation Agenda which include detailed modalities on the operation of EIT such as the selection and designation of the partnerships into KICs and their performance monitoring. This selection and priority-setting process is governed by the EIT Regulation.

The EIT addresses specific structural weaknesses in the EU’s innovation capacity which are common across Member States. Amongst them are: the under-utilisation of existing research strengths for creating economic or social value; the lack of research results brought to the market; low levels of entrepreneurial activity and mind-set; low leverage of private investment in research and development; an excessive number of barriers to collaboration within the knowledge triangle of higher education, research, business and entrepreneurship on a European level. The EIT addresses these challenges through the KICs.

By providing coordination and steering, the EIT has tailored its support structure to the specific needs and goals of the KICs (i.a. requirements for setting up KICs, performance based funding, simplification). Through systematic focus on cross-KIC activities, sharing of best practices and integrating lessons learnt from the past, the EIT has built up knowledge and experience on which each KIC can draw (i.a. framework for guidance to set up new KICs). In turn, the KICs provide the EIT with practical insights and feedback on what works on the ground and what does not (thus increasing effectiveness and synergies).

The total budget for the EIT under Horizon 2020 is EUR 2.4 billion
[190](#footnote191)
. Of this overall EIT funding allocation a fully mature KIC is expected to receive on average between EUR 70 million and EUR 90 million annually to cover its portfolio of activities presented in its annual Business Plan. The duration of EU funding is expected to last up to 15 years and after such a period the KICs should be able to pursue their activities without EU funding.

|  |
| --- |
| Lessons learned and future challenges  The Horizon 2020 interim evaluation Staff Working Document identifies the need to rationalise the overall European research and innovation partnership landscape, improve their openness and transparency, and link them with future EU R&I missions and strategic priorities. The EIT/KICs are unique type of partnerships based on knowledge triangle integration with the education at its core and thus they are different in nature to other partnerships.  The EIT interim evaluation Staff Working Document concluded that it contributes to addressing structural weaknesses in the EU’s innovation capacity. The EIT evaluation highlights the need to develop further synergies with other EU initiatives from the programming stage. It also identifies scope for streamlining the relevant goals the EIT and the KICs are expected to achieve with clear and measurable objectives. It notes that the role of the KICs in the EU R&I landscape needs to be better defined. The integration of the KICs into local innovation ecosystems need to improve.  The Commission Opinion on the EIT independent evaluation also stresses the rationale behind the establishment of the EIT and its contribution to the development of the Community and Member States innovation capacity in order to tackle societal challenges, through the integration of the knowledge triangle. It confirmed to target major structural weaknesses of the innovation capacities in the EU (in key thematic areas) such as the limited entrepreneurial culture, the low level of cooperation between academia and industry and the insufficient development of human potential, and aims to contribute to closing the innovation gap between the EU and its key competitors.  The Lamy High-Level Group recommends that KICs could be more coherently deployed to address global challenges, and be directly incorporated into the post-2020 EU R&I programme. It recognises that education plays a central role in the KICs and it calls for Europe’s universities to stimulate entrepreneurship, tear down disciplinary borders and institutionalise strong non-disciplinary collaborations between universities and industry.  The Communication on the Interim Evaluation outlines recommendations for the future guiding principles of the EIT and the KICs:  ØStreamlining the relevant goals which the EIT and the KICs are expected to achieve through clear and measurable objectives;  ØThe role of the KICs in the EU R&I landscape also needs to be better defined;  ØImproving the openness and transparency of the partnerships (including KICs) and link them with future EU R&I missions and strategic priorities.  The High Level Group on the EIT identified a clear need to strengthen the role of the EIT headquarters as a provider of shared services and expertise to the KICs. |

8.2What do we want to achieve with a revised role for the EIT/KICs in the next Framework Programme?

The focus of the EIT on the knowledge triangle integration through developing KICs remains valid as well as its added-value in providing a support mechanism to the KICs and in setting the framework conditions to create innovation. In order to reinforce the role of the EIT and the KICs in the overall European R&I support system and in light of the overall rationalisation of the European R&I partnerships (see dedicated Annex), a revised role for the EIT/ KICs under the Framework Programme will aim at achieving the following objectives:

·Reinforce the focus of current and future EIT KICs on delivering on EU strategic priorities, in particular global challenges through the integration of education, research, business and entrepreneurship. It will foster, grow and strengthen ecosystems for addressing global challenges through research and innovation across Europe by connecting people, disciplines, sectors, organisations and resources.

·EIT KICs will play a stronger role in reinforcing the research and innovation capacity in regions with modest or moderate innovation activity through its innovation hub co-location centers and their networking. 

·Reinforce the links between higher education and the innovation ecosystem by scaling up the knowledge triangle model established by the EIT beyond the KICs and by mainstreaming support for the renewal of European universities. This will be achieved by stimulating entrepreneurial education, fostering strong non-disciplinary collaborations between industry and academia; and identifying prospective skills for future innovators to address global challenges, which includes advanced digital and innovation skills but also skills specific to each thematic area.

·Ensure complementarity and synergies between the EIT and the KICs, the European Innovation Council (EIC), and other research and innovation instruments for a seamless support to research and innovation in Europe.

8.3What is changing in practice under the next Framework Programme for the EIT and the KICs?

Towards a European seamless support to innovation ecosystems through complementarity with the EIC

The EIT will play a reinforced role in strengthening sustainable innovation ecosystems across Europe. The EIT midterm evaluation has confirmed the relevance of the EIT model. Stronger integration of the EIT in the Framework Programme will be sought through a focus on synergies with key instruments such as the EIC Accelerator, i.e. via EIT-supported start-ups, which can be scaled up through the EIC or offering ecosystem support such as mentoring or coaching for EIC funded scale-ups in the KICs' thematic fields. The EIT will ensure complementarity with other instruments in the Framework Programme though its distinctive focus on entrepreneurial education, skills identification and reinforcement, and strong multidisciplinary collaborations between industry and academia.

The role and visibility of the KICs innovation hub co-location centres as physical places for experimentation and co-creation around global challenges and future R&I missions ((incl. direct feedback loops with potential users and citizen) will be reinforced. This will help developing innovations in line with societal needs and support their market uptake, as well as reinforce the international visibility of European physical hubs for addressing key challenges/missions.

Stronger alignment with FP strategic priorities and European R&I partnership approach

EIT and KICs will be a core part of the future Framework Programme with its key focus on strengthening innovation ecosystems. EIT and KICs will also play a key role in addressing global challenges and will strive to contribute to achieving the objectives of future R&I missions (Pillar 2) as well as the Open Science (Pillar 1).

The alignment of the EIT's activities with others in the future Framework Programme will improve through the strategic planning, in compliance with the EIT's regulation and its specific governance structure. As regards the broad strategic orientations and setting-out multi-annual Commission corporate priorities for the Framework Programme implementation, the EIT will help inform the broad areas and themes of the future partnerships, thereby ensuring complementarities and synergies with other relevant Framework programme initiatives and EU programmes.  

Reinforced role of the KICs for education and training and the modernisation of universities

The EIT has played a pioneering role in integrating education and training in the innovation ecosystems across multiple societal challenges. In order to strengthen the role of the EIT, a better integration of the education aspects into the European innovation ecosystems through increased support to European universities by stimulating the entrepreneurial and open science education and fostering multidisciplinary collaboration between industry and academia is necessary. This implies a structured approach on support actions for driving innovation and entrepreneurship agendas in universities in order to achieve a systemic effect.

Such an approach will also build on the successful outreach activities by the EIT Regional Innovation Schemes that target modest and moderate innovators and help create network effects from existing excellence.

Through the knowledge triangle integration, the identification by KICs of prospective skills needs/curricula for innovation to solve global challenges and R&I missions will be encouraged. New types of profiles and competences might indeed need to be developed and reinforced in key thematic areas. Following the identification of emerging skills needs, EIT and KICs could develop dedicated training offers in partnerships with the knowledge triangle actors.

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| What will we be the implications of the changes?  More coherence: Through an overall limited number of European R&I partnerships – including the KICs - with clearer intervention logics based on FP objectives; complementarity with the innovation support provided through the European Innovation Council; and reinforced education focus of the KICs.  More impact: Through a more strategic and revised policy approach for the priority-setting of the KICs, closely linked to the overall strategic programming of the Framework Programme to deliver on global challenges and EU research and innovation missions.  More openness and transparency: Through the application of an impact-based criteria framework for the selection, implementation, monitoring and phasing out of the KICs, as for other R&I partnerships. |

8.4How will the changes be implemented?

The EIT Regulation will be amended:

·To align EIT with the objectives of the next Framework Programme;

·To align the programming of the EIT with Horizon Europe strategic programming;

·To reinforce the role of the EIT in developing innovation capabilities through addressing global challenges;

·To seek an enhanced role for the EIT in embedding innovation and entrepreneurial capabilities, prospective skills identification and talent development in Higher Education Institutions (HEIs).

8.5What alternatives were considered?

Taking into account the stakeholder suggestions on the improvement of the EU R&I partnership landscape, the following policy alternatives have been considered and discarded:

·Reduction/Discontinuation of EIT KICs interventions

The EIT is highly relevant and has a clear EU added value as there is no other instrument that builds EU-wide ecosystems of education, research, business and other stakeholders (EIT interim evaluation). The reduction of the EIT scope of its intervention or a full or partial phasing out of KICs from the current operating model would bear severe implications and negative impact on the knowledge triangle integration development, the research and innovation performance and the overall research and innovation landscape in Europe.

·Continuation of strategic approach to EIT/KICs as implemented under Horizon 2020

EIT/KICs would operate on the basis of initial objectives, scale and operating modes. The key challenge of rationalization of the European R&I partnerships landscape in line with the overall objectives of the future Framework Programme would not be realised. The coherence between the EIT and other EU innovation policy initiatives and instruments at programming as well as implementation level would not be matched.

 

·Direct integration of KICs into the Framework Programme (without EIT)

As confirmed by the past evaluations, the EIT model comprising the EIT and its Knowledge Innovation Communities (KICs) is valid and working well. The EIT has tailored its support structure to the specific needs and goals of the KICs by providing coordination and steering (i.a. requirements for setting up KICs, performance based funding, simplification). Through systematic focus on cross-KIC activities, sharing of best practices and integrating lessons learnt from the past, the EIT has built up knowledge and experience on which each KIC can draw (i.a. framework for guidance to set up new KICs). In turn, the KICs provide the EIT with practical insights and feedback on what works on the ground and what does not (thus increasing effectiveness and synergies).

The EIT/KIC model is based on a long-term approach to innovation, i.e. KICs are set up bearing in mind a long-term perspective to achieve the impact and their sustainability beyond the direct public financial support. The EIT provides a wide range of services, from education, training and coaching, building and maintaining networks where young entrepreneurs and enterprises connect with future partners and investors in order to take up the research results and bringing them to the market. This goes far beyond the management of EU contracts and projects. The EIT has thus built up a wealth of knowledge and experience on innovation that is unique at a European scale and decoupling of EIT and KICs would cause the effectivity loss. The gradually built-up EIT Community of regular exchange, mutual support and trust would disappear. Further, the current efficiency at the EIT central management level as well as in the management of KIC operations would be lost.

8.6Relevant studies

·European Commission (2017), Interim evaluation of Horizon 2020, Staff Working Document (SWD).

·European Commission (2017), Interim evaluation of the European Institute of Innovation and Technology (EIT), Staff Working Document (SWD).

·European Commission (2017), LAB – FAB – APP: Investing in the European future we want, Report of the independent High Level Group on maximising the impact of EU Research & Innovation Programmes.

·European Parliament (2017), REPORT on the assessment of Horizon 2020 implementation in view of its interim evaluation and the Framework Programme 9 proposal.

·European Research Area And Innovation Committee (ERAC) (2017), ERAC Opinion on the Interim Evaluation of Horizon 2020 and preparations for the next Framework Programme.

9Support to education in Horizon Europe

9.1Why do we need support to education in the Horizon Europe

The European Research Area (ERA) is designed to be the backbone of a well-performing science and innovation system in Europe. Through it, knowledge and a highly skilled workforce circulate freely, researchers benefit from attractive careers and gender equality is ensured, where Member States develop common strategic research agendas, aligning national plans, defining and implementing joint programmes, and where the outcomes of R&I are understood and trusted by informed citizens and benefit society as a whole. Without a strong and well-performing ERA, we would miss opportunities to set common agendas, instil a culture of cooperation, and establish and achieve the funding scale required for tackling important societal challenges.

Demand for highly skilled, socially engaged people is both increasing and changing. Driven by digital technology, jobs are becoming more flexible and complex. People’s capacities to be entrepreneurial, manage complex information, think autonomously and creatively, and use digital resources are more crucial than ever. European higher education must simultaneously respond to the moving targets of education and training, and prepare the next generation of skilled digital natives to be resilient in the face of rapidly evolving societal challenges.

The skills mismatch in Europe is well documented, and Europe’s need to address it is more urgent than ever. The unmet demand for graduates in the science, technology, engineering and maths (STEM) fields is great, as is the need to ensure our students have the transversal skills necessary to be successful in an increasingly competitive labour market. Moreover, the increasing prominence of carrying out research in a collaborative, transparent and accessible manner is transforming the research landscape. Universities need to address these issues in order to maintain the flow of skilled graduates.

A coherent approach of EU policies on education, research and innovation is crucial to create 'jobs, growth, investment, and competitiveness'. Education will have to play an important role in the future Europe as investing in skills, competences and knowledge is essential to boost Europe's resilience. Investing in stronger links between education and research will support the development of human talent, which is the fundamental driver of innovation. The importance of the human capital in addressing the future global challenges will be enhanced in the next generation of European programmes. Universities, as leading centres of innovation, need to be empowered to create more innovation impacts, across all their core functions, notably education, research, knowledge transfer, engaging with citizens in science and other public services.

This is in concordance with the Communication on Strengthening European Identity through Education and Culture, the renewed EU agenda on Higher Education and the Communication on the Digital Education Action Plan.

Europe's high-level skills needs must be addressed through investments in the development of competences, inter-disciplinary, transferable and entrepreneurial skills in forward-looking fields or disciplines that are strategic for smart economic and social development (such as science, technology, engineering and mathematics, climate change, clean energy, artificial intelligence, robotics, data analysis, design, etc.).

The innovation performance of the EU is growing, but not fast enough to ensure our future welfare. Modern universities as leading centres of innovation need to be empowered to create more innovation impacts, across all their core functions, notably education, research, knowledge transfer, engaging with citizens in science and other public services. This has to be nurtured by the culture of the university and its institutional set-up. The core attributes and functions of modern universities should enable excellence, innovation and openness to the world. Excellence must be at the centre of research – including incentives for inter- and trans-disciplinarity. Openness must be at the centre of the research mind-set. Internationalisation and cross-border open research practices must be embedded in programmes.

In the current and future world of research it will be important to adapt education models and experiment with new forms of open education and learning empowered by digitisation. It is essential to provide, train and reward young talent with future skills for the jobs of tomorrow. Universities should go beyond their educational missions and become regional hubs for education and innovation exchange, promoting joint curricula with industry. Structural collaboration with local and regional stakeholders will further facilitate science-industry cooperation. Stronger links and coherence between European Research Area and European Higher Education Area by better aligning the objectives and priorities is crucial.

Until recently, education and culture have not been centre stage in the debate about the future of Europe but, since leaders decided to put them on the agenda at their meeting in Gothenburg in November 2017, they come increasingly to the fore. The discussion among leaders has been informed by a contribution of the Commission on "Strengthening European Identity through Education and Culture"
[191](#footnote192)
, which set out a number specific actions, i.e. a vision to create a European Education Area by 2025. Key goals include stepping up investment in education to 5% of EU GDP. It includes the establishment of a European Universities initiative, and taking forward the mutual recognition of higher education diplomas. The importance of ensuring that higher education contributes to innovation is also emphasised in the Renewed EU Agenda for Higher Education, published in May 2017.

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| What do we have now on education in Horizon 2020?   Marie Skłodowska-Curie Actions (MSCA) is a bottom-up, competition-for-excellence based research programme focusing on frontier science, research excellence, human capital training and career development, inter-sectoral and international mobility and good working conditions for researchers. At the level of postgraduate training, MSCA is mainstreaming innovation in learning context for researchers and fostering new skills and will strengthen its efforts to do so in the future: MSCA equip researchers with training in transferable competences such as a creative mind, an entrepreneurial outlook and a diversity of skills, including teaching of students, that will allow them to face current and future global challenges, as well as match the future needs of the labour market and enabling the transmission to, and take-up of research results by, society and economy.  The educational dimension has been a major focus of the European Institute of Innovation and technology (EIT) since its creation. The EIT has always stressed the importance of an adequate mix of technical and entrepreneurial skills as drivers of innovation. Through its KICs, the EIT supports a variety of education, and more generally human capital development activities, aiming at training the next generation of innovators and entrepreneurs. The offer, with the EIT Label as its flagship, is targeting primarily Master and PhD students, as well as a growing number of professionals. Students are awarded degrees from partner universities, on top of which comes the EIT Label. This Label aims to be a guarantee of quality for innovative programmes bridging universities and industry. Students are exposed to new cross-sectorial curricula with innovative pedagogical models of teaching and learning, aiming at developing at the same time both their technical knowledge and their entrepreneurial mind-sets and skills. These new programmes go beyond what is being normally offered by the universities partners in a KIC, usually research-intensive universities, in particular in terms of mobility, industry exposure, networking opportunities and, more broadly, learning experience.  Science with and for Society part on 'Accelerating and catalysing processes of institutional change' contributes to implementing the RRI keys (public engagement, science education, ethics including research integrity, gender equality, and open access) through institutional governance changes in Research Funding and Performing Organisations (RFPOs) in an integrated way and to disseminate good practices. Results contribute to the implementation of ERA priorities, a greater involvement of all stakeholders in R&I, and a better and more sustainable engagement with society.  What have we learned from evaluations   According to the Lamy Group, a fundamental reform of the role of education should systematically embed innovation and entrepreneurship in education across Europe [192](#footnote193) . Europe’s universities need urgent renewal, to stimulate entrepreneurship and tear down disciplinary borders. Strong non-disciplinary collaborations between universities and industry should become the rule and not the exception. The next Framework Programme needs to incentivise for the modernisation of universities. Research and higher education institutions that actively promote open science, open innovation and openness to the world (e.g. through new ways of teaching, promoting cross-disciplinarity and entrepreneurship, or attracting researchers and students from around the world) should be rewarded.  The MSCA have contributed to making the science system of the Union more competitive and attractive on a global scale. Evidence shows that the MSCA not only have a positive structuring impact on individuals, organisations, and at system level, but also yield high-impact and breakthrough research results and contribute significantly to societal as well as strategic challenges.  The EIT fills a gap in the system of support for innovation provided by the Member States and bring unique perspectives to education programmes [193](#footnote194) . EIT-label educational courses provide graduates with hard and soft entrepreneurial skills, a unique access to businesses and a stronger level of competence in delivering innovation. Some linkages in KICs´ knowledge triangle activities are still underexploited, e.g. those between education and innovation-support and acceleration services, and require further efforts in the future. KICs´ should better monitor their education offer in view of ensuring a high quality having in mind the goal of increasing the outreach of their educational activities. Its mandate was to develop ‘flagship’ education as a model for excellence throughout European higher education, i.e. reach out and influence higher education beyond those individuals, faculties and institutions directly involved. In order to broaden the added value, the EIT and its KICs should re-examine their actual contribution towards a systemic transformation of the education landscape [194](#footnote195) . It is likely that additional efforts will be required, for example through an alternative offer based on better quality (more specific, efficient and cost effective), on broader targeted groups (beyond young Master and PhD students), and the export of the EIT educational model to a broad audience of education providers. |

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| What do stakeholders say? [195](#footnote196)  ·Seek a stronger alignment of policies for education, research and innovation, stronger links between the European Research Area and the European Higher Education Area.  ·Linking education, research and innovation through an alignment of the next Framework Programme and the successor of Erasmus+ should be explored.  ·While keeping the main focus on research, introduce into EU grant agreements the possibility of linking research to education and sharing research results with students.  ·Researchers funded through Marie Skłodowska-Curie Actions (MSCA) and the ERC, for example, should be permitted to engage in high-level teaching activities and to include these activities in their time sheets.  ·Consider introducing a funding stream within the MSCA instrument for doctoral schools, in order to enhance the capacity of universities in the education and training of the next generation of researchers.  ·The emphasis on education in the report of the High Level Group on maximising the impact of EU R&I programmes has resonated amongst stakeholders [196](#footnote197) . The call to “educate for the future and invest in people who will make the change”, including the need for universities to better support innovation and entrepreneurship, generated a lively debate on universities as enablers of innovation in the 21st century [197](#footnote198) . |

9.2What do we want to achieve on education in the next Framework Programme?

Integrate research and education across borders. In order to do so, strong links between the European Research Area (ERA) and European Higher Education Area (EHEA) agendas need to be developed. EU programmes on research and innovation, and on education need to provide incentives for higher education institutions and research institutes to integrate education, research and innovation across borders and to facilitate knowledge transfer from higher education institutions to companies or spin-offs. Member States, regions and higher education institutions need to be incentivised to work together to upgrade curricula to match changing skills needs, revise career incentives for academics to recognise entrepreneurial achievements or reward institutions for new ways of teaching that promote trans-disciplinary and entrepreneurial skills. Synergies also need to be developed between research and innovation activities on the one hand and students’ education on the other hand. It will be crucial to establish the future programmes in such a way that they do not only promote the transfer of research results to companies and other societal actors, but also the transfer of research into teaching, thereby enabling students to connect better with and learn from research and researchers. Teaching and professional development for teaching need to be promoted and integrated into an academic career as early as possible, through future research funding schemes such as the European Institute for Innovation and Technology (EIT) and the Marie Skłodowska-Curie Actions (MSCA). Synergies need to be exploited across all relevant funding programmes, both nationally and at European level.

Facilitate knowledge transfer from higher education institutions and research institutes into existing companies or spin-offs and introduce rewards for academics' entrepreneurial achievements. To achieve this, the following could be considered:

·regard excellent teaching and education-focused scholarship as activities equal to excellence in research.

·regard excellent service to society, innovation activities or transfer of knowledge outside academic sector.

·establish reward systems for academics for their 'service to society' in general and for their entrepreneurial achievements in particular; reward any type of innovation and entrepreneurial activities, not excluding the social and non-profit sector.

Reward new ways of teaching towards transdisciplinary and entrepreneurial skills:

·Programmes like MSCA and EIT Knowledge & Innovation Communities already ensure the establishment of training and career development systems that equip students and researchers, including many future academics, with skills based on the 'Triple I' principle, i.e.. international, interdisciplinary, inter-sectoral. MSCA and EIT will continue to do so.

·EU programmes could consider including incentives that enable its participating higher education institutions to reward and promote excellent university teachers and education-focused leaders, in order to empower students to become agents of change, and to encourage higher education institutions introducing such systems into their general practice.

Upgrade curricula to match changing skills needs. Well-designed higher education programmes and curricula, centred on students’ and researchers' learning needs, are crucial for effective skills development. A wider range of course choices and options for continuous professional development will help higher education respond better to people's needs. As much teaching in higher education takes place in research-performing institutions, research must be better exploited as input for teaching, while undergraduates should be more involved in research such that they are afforded opportunities to explore contemporary issues and develop their research skills. Digitally-enabled open science provides for new possibilities to address this. The programme should explore ways to enhance the quality and relevance of learning and teaching as well as to promote a stronger link between teaching, learning and research at all study levels, and should consider ways to provide incentives for institutions, teachers and students to intensify activities that develop creativity, innovation and entrepreneurship. This could for example happen through the European Universities 
[198](#footnote199)
 working across borders and fostering development of new joint and integrated long term and sustainable strategies on education, research and innovation based on trans-disciplinary and cross-sectoral approaches to make the knowledge triangle a reality, providing impetus to economic growth.

9.3What will change compared to Horizon 2020 and what are the expected implications? 

Horizon Europe will explore ways to put a greater emphasis on human capital and skills development. A coherent approach on human capital across all parts of the future Programme should be ensured and the links between education on the one hand and research and innovation projects on the other should be strengthened. Follow-up and monitoring of the results of the human capital and skills development as part of the research and innovation projects should be reinforced.

The European Universities initiative, the MSCA and the EIT Community could help universities to become more entrepreneurial, innovation oriented educational institutions, supportive of open science practices, i.e. through developing a complete portfolio of education activities not only at higher level (bachelor, masters and doctoral programmes) but also in a life-long-learning perspective. This would reduce skills mismatch and boost skills uptake across the whole education chain. European Universities will promote cross-border cooperation among higher education institutions, boost mobility for students and teachers and facilitate language learning. The idea is to promote bottom-up alliances of universities across the EU, bringing together people who can cooperate in different languages, across borders and disciplines. European Universities will pioneer studies across disciplines and sectors. This approach will help address big societal challenges and skills shortages. The aim of European Universities is to drive innovation in education and research in Europe whilst making use of the most innovative pedagogies and digital technologies. European Universities will act as models for other higher education institutions in the EU, progressively increasing the international competitiveness of European higher education. Synergies should be explored between Horizon Europe and the future Erasmus programme to see whether it would be possible to co-fund higher education institutions which are partners in alliances of the European Universities initiative.

The role played by EIT in relation to strengthening the innovation ecosystem landscape across Europe and in mainstreaming its educational support for the renewal of European higher education institutions will be crucial. Actions aiming at fostering the Europe's innovation capacity and the innovation in higher education and business should allow the EIT Community to test and share the outcome of their experimental educational activities beyond their direct beneficiaries and offering students, entrepreneurs and professionals across and beyond Europe the cross-cutting programmes where specialist and sector specific knowledge is combined with entrepreneurial and innovation oriented skills. Synergies will concern also activities that support sectoral vocational training in order to tackle also the needs identified at single KIC and cross-KIC level. Aiming at equipping the next generation of innovators with the relevant technical and transversal skills to thrive in a fast changing economic environment, the EIT’s education programmes include physical and cross-sectoral mobility of students. The synergies with Erasmus are evident and some elements of EIT programmes, in particular the mobility components, could be also supported by Erasmus when relevant.

9.4How will this be implemented?

Options will be explored to ensure that every researcher recruited on any R&I project in the next Framework Programme gets proper training & career development and good working conditions at the same high standards. This could entail establishment of Career Development Plans for young researchers & innovators, the mandatory implementation of the European Charter and Code for Researchers
[199](#footnote200)
 to ensure good working conditions, as well as a 'best effort' to implement an open, transparent, and merit-based recruitment (OTM-R) mechanism in all projects.

The cost for trainings and skills development should become eligible in programmes where it is relevant, such as projects related to specific missions, global challenges or specific innovation activities, in addition to MSCA and EIT that already implement this. The role of teaching for researchers and feeding back research results into teaching will be general points of attention. Feeding back results from Framework Programme projects into teaching should be requirements in dissemination & exploitation and will be closely followed-up, monitored and ex-post evaluated.

MSCA and EIT educational programmes can support training & career development for the rest of the Framework Programme. As the missions will require highly interdisciplinary skilled people, proper training is likely to be a strong prerequisite to fulfil a mission's goal.  In this respect, the missions could very well profit from the MSCA and EIT educational activities and use it as and implementing tool to support relevant interdisciplinary skills training activities. Such skills will include a creative mind, an entrepreneurial outlook, but also teaching of students, transferring back research result into teaching, engagement with society in general, which will allow researchers to face current and future global challenges and enable the transmission to, and take-up of research results by, society and economy.

Together with the Framework Programme's part on 'Sharing Excellence', measures should be considered under that can stimulate brain circulation also to Widening countries, without compromising on the excellence principle. The future Euratom Programme could fund MSCA to provide training & career development in the sector of nuclear research.

The European Universities initiative will be a catalyst for R&I activities and projects, innovation hubs and human capital development. The alliances will bring together a new generation of Europeans, who are able to cooperate in different languages, across borders and disciplines, to address the big societal challenges and skills shortages that Europe faces, underpinned by European higher education institutions which seamlessly cooperate across borders. The alliances will act as a game changer in Europe progressively increasing the international competitiveness of European higher education institutions by

•fostering development of new joint and integrated long term and sustainable strategies on education, research and innovation based on trans-disciplinary and cross-sectoral approaches to make the knowledge triangle a reality;

•being drivers of educational and research innovation by making use of the most innovative pedagogies and digital technologies;

•creating new joint curricula based on innovative research output forward looking skills and multidisciplinary and inter-sectoral approaches;

•attracting the best talent, students, teachers and researchers across the world and acting as role models for other higher education institutions and the business sector throughout Europe by committing to implement policies on education, research and innovation;

•fostering opportunities for talent, students, teachers, researchers and other public and private actors to co-create knowledge and innovation together (e.g. working together to address global challenges or other priorities identified by the Framework Programme).

Annex 9 - Rules for Participation

1Single set of rules

1.1What is the current situation under Horizon 2020?

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| FACTS |
| A single set of participation rules exists for participants in the programme, for example concerning eligibility criteria for the calls for proposals and the reimbursement rate. This applies to the different types of R&I support provided under the programme. |
| The rules are aligned as much as possible to the EU Financial Regulation, in   order to ensure coherence with other EU funding programmes. Some derogations from the rules do, however, exist for specific initiatives. |
| Under FP7, the previous programme covering the 2007-2013 period, different rules including eligibility criteria and reimbursement rates, depending on the programme part and on the type of organisation, were used. |

A single set of rules was put in place under Horizon 2020 with the aim of ensuring a coherent framework for participation, including within programmes managed by the European Institute of Innovation and Technology (EIT), public-private partnerships managed by Joint Undertakings under Article 187 of the Treaty on the Functioning of the EU (TFEU) and public-public partnerships under Article 185 TFEU.

Following the inter-institutional discussions on Horizon 2020, flexibility was sought by introducing a number of limited derogations, which exist for both Joint Undertakings (under Article 187) and public-public partnerships (Article 185).

For Joint Undertakings, the scope of derogations from the Rules for Participation is set out in the Rules themselves and developed further through delegated acts – a means by which the Parliament and the Council maintained control on the detailed content of these derogations. For Article 185 initiatives, derogations from the Rules are laid down in the respective basic acts, adopted by the Parliament and Council by ordinary legislative procedure.

Compared to FP7, the single set of rules under Horizon 2020 was a major simplification. Under FP7, participants had to comply with different rules depending on the programme part. The different funding bodies applied a variety of diverging rules, with different eligibility criteria or funding rates. This triggered fragmentation, reduced legal certainty and increased the administrative burden and resources required to participate. As highlighted in the ex-post evaluation of FP7, the level of complexity and the lack of consistency between different parts of the programme meant that the rules were too complex. This explains, at least in part, the relatively high error rate associated with FP7 which the Court of Auditors attributed to risks inherent in the programme's design and implementation.
[200](#footnote201)

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| Lessons learnt from Horizon 2020  The application of the single set of rules is widely seen by beneficiaries as advantageous: it contributes to increased legal certainty, coherence and simplification of the rules. For example: "One single set of simplified EU rules for participation is essential to safeguard a level playing field across borders given the big differences in national legislation….we welcome the introduction of a single set of rules".  (CESAER position paper on FP9: "How You Can Boost Worldwide Research and Innovation", January 2018).  "Within the EU funding programmes landscape, Horizon 2020 has achieved remarkable simplification. It has made access to the programme easier, reduced costs for applicants and made the programme more attractive"  (p.18, LAB-FAB-APP: Investing in the European future we want. Report of the High Level Group on maximising the impact of EU research and innovation programmes, July 2017).  The interim evaluation of the Article 185 initiatives indicates that "initiatives with fully centralised implementation are considered as more efficient in their programme implementation" while the reporting requirements for participants in decentralised initiatives [201](#footnote202)  were identified "as a challenge"   (p. 32, Staff Working Document on Evaluation of the Participation of the EU in Research and Development Undertaken by Several Member States Based on Article 185 of the TFEU, September 2017).  The interim evaluation of Joint Undertakings also indicates that uniform application of the Horizon 2020 Rules contributed to the improved operational efficiency of JUs, but this progress was in some cases hampered by the design of the individual JU.  (p. 36, Staff Working Document on Evaluation of the Participation of the EU in Research and Development Undertaken by Several Member States Based on Article 185 of the TFEU, September 2017). |

1.2What are the changes?

The new EU Financial Regulation will be used as a common reference. Derogations should be kept to a minimum and are clearly justified in every case..

The Rules for Participation will aim for further simplification, increased legal certainty and reduced administrative burden - for beneficiaries, for other stakeholders and for programme administrators. This will uphold the single set of rules while introducing further improvements. All bodies implementing the programme will be brought together under one roof, including the EIT. Derogations for Article 185 and 187 initiatives, which will adhere to the common set of funding rules and the central management of all financial contributions, will be minimised.

The Participant Guarantee Fund
[202](#footnote203)
 (renamed Mutual Insurance Mechanism) will also be extended to cover actions under Horizon Europe managed not only by the Commission, the EU agencies and the EU funding bodies (i.e. JUs and the EIT), but also by non-EU funding bodies (i.e. the bodies implementing the public-public partnerships under Article 185). Moreover, it may also be extended to beneficiaries of any other directly managed Union programme
[203](#footnote204)
.

1.3What are the expected implications of the changes?

A single set of rules would deliver on the aim to rationalise Horizon Europe. It would streamline implementation methods and reduce administrative burden for beneficiaries. The accessibility and attractiveness of the programme, in particular for applicants with limited resources such as SMEs, would be sustained. As a result, legal certainty would increase and participation would be simplified further.

The extension of the coverage by the Participant Guarantee Fund to non-EU funding bodies would lead to more coherence in applying the rules. Provided that proper safeguards are in place, this is expected to be positively perceived by Member States, many of whom previously expressed their wish for including projects funded by Article 185 initiatives under the scope of the Fund.

1.4What alternatives have been considered?

Keep the Horizon 2020 status quo - this would reproduce all the current programme's benefits and limitations. While this would result in a smoother transition, it would also not lead to further simplification and streamlining and would not take account of the lessons learnt from the Horizon 2020 interim evaluation.

Return to the FP7 situation - this would abandon the single set of rules principle and allow the different bodies to adopt their respective rules as they see fit. However, this flexibility would be granted at the expense of beneficiaries, who would face an excessively complicated set of diverging rules. Simplification efforts would be thwarted, and legal certainty would decrease.

The administrative burden for adjusting to different sets of rules would become prohibitive, hampering participation by beneficiaries with limited resources, in particular SMEs.

2Funding model and types of action

2.1What is the current situation under Horizon 2020?

|  |
| --- |
| FACTS |
| The single set of rules under Horizon 2020 features a simplified funding model. There is a single funding rate per type of action (up to 100% of eligible costs for research actions, but limited to a maximum of 70% for innovation actions, except for non-profit organisations) and a 25% flat rate for indirect costs. A number of different types of action exist.. |
| Under FP7, the previous programme from 2007 to 2013, costs were reimbursed based on a complex matrix of organisation categories and activity types. |

Funding model

·The Horizon 2020 funding model is based on two main features: a single funding rate (up to 100% of eligible costs for research actions, but limited to a maximum of 70% for innovation actions, except for non-profit organisations), and a single flat rate of 25% for indirect costs.

·Under FP7, contrastingly, direct costs were reimbursed based on a matrix of organisation categories and activity types. The indirect costs were calculated using four different methods, including real indirect costs.

·The Horizon 2020 funding model has mobilised and largely satisfied stakeholders. In a simplification survey conducted in 2015, around 78% of respondents expressed the benefit of a single reimbursement rate in a project, and 74% felt the benefit of the single flat rate for indirect costs.

·The Horizon 2020 funding model has had positive effects on stakeholder appreciation, time to grant
[204](#footnote205)
, attractiveness and has reduced administrative burden. This is reflected in the application statistics and underlined by the interim evaluation of Horizon 2020.

Types of action

The following types of action are used within Horizon 2020:

|  |  |  |
| --- | --- | --- |
| Type of action and objectives pursued | Target Groups | Changes FP7 |
| GRANT-BASED TYPES OF ACTION | | |
| Research and Innovation Actions (RIA): Action primarily consisting of activities aiming to establish new knowledge and/or to explore the feasibility of a new or improved technology, product, process, service or solution. It may include basic and applied research, technology development and integration, testing and validation on a small-scale prototype in a laboratory or simulated environment | Consortia of partners from different countries, industry and academia | Changes to funding model and further focus on innovation |
| Innovation Actions (IA): Actions primarily consisting of activities directly aiming at producing plans and arrangements or designs for new, altered or improved products, processes or services. For this purpose they may include prototyping, testing, demonstrating, piloting, large-scale product validation and market replication. They are used for areas where the scientific and technology insights are available and the focus shifts to turning these into applications. | Consortia of partners from different countries, industry and academia | New action and changes to funding model |
| Fast Track to Innovation (IA): Continuously open calls will target innovation projects addressing any technology or societal challenge field | Consortia of partners from different countries | New action |
| European Joint Programme Cofund (COFUND-EJP): Support to coordinated national research and innovation programmes in implementing a joint programme of activities (ranging from research and innovation activities to coordination activities, training and dissemination activities). | Independent legal entities from Member States or Associated Countries owning or managing national research and innovation programmes | New action |
| ERA-NET-Cofund: Support public-public partnerships in their preparation, establishment of networking structures, design, implementation and coordination of joint activities as well as Union topping-up of a trans-national call for proposals | Independent legal entities from Member States or Associated Countries owning or managing national R&I programmes | - |
| Pre-Commercial Procurements (PCP): PCP actions aim to encourage public procurement of research, development and validation of new solutions that can bring significant quality and efficiency improvements in areas of public interest, whilst opening market opportunities for industry and researchers active in Europe | EU funding for a group of procurers ('byers group') to undertake together one joint PCP / PPI procurement | - |
| Public Procurement of Innovative solutions (PPI): PPI actions enable groups of procurers to share the risks of acting as early adopters of innovative solutions, whilst opening market opportunities for industry | EU funding for a group of procurers ('buyers group') to undertake together one joint PCP/PPI procurement | - |
| Coordination and Support Actions: Actions consisting primarily of accompanying measures such as standardisation, dissemination, awareness-raising and communication, networking, coordination or support services, policy dialogues and mutual learning exercises and studies, including design studies for new infrastructure and may also include complementary activities of networking and coordination between programmes in different countries | Single entities or consortia of partners from different countries | - |
| Marie Skłodowska-Curie Actions (MSCA): Bottom-up funding for international research fellowships in the public or private sector, research training, staff exchanges | Early stage researchers or experienced researchers (of any nationality), managerial, technical or administrative staff supporting the research and innovation activities, single entities or consortia of partners from different countries, industry and academia | - |
| MSCA Co-fund: Support for regional, national and international doctoral and fellowship programmes to foster excellence in researchers' training, mobility and career development, spreading the best practices of the MSCA | Single legal entities from Member States or Associated Countries owning or managing international/ national/regional R&I programmes, early stage researchers or experienced researchers (of any nationality) | - |
| European Research Council frontier research grants: Funding for projects evaluated on the sole criterion of scientific excellence in any field of research, carried out by a single national or multinational research team led by a ‘principal investigator’ | Excellent young, early-career researchers, already independent researchers and senior research leaders. Researchers can be of any nationality and their projects in any research field. | - |
| SME Instrument Phase 1 (IA): The SME Instrument is targeted at all types of innovative SMEs showing a strong ambition to develop, grow and internationalise. It provides staged support covering the whole innovation cycle in three phases complemented by a mentoring and coaching service. Phase 1 – feasibility study verifying the technological/practical as well as economic viability of an innovation idea/concept | Only SMEs can participate. Either a single SME or a consortium of SMEs established in an EU or Associated Country | New action |
| SME Instrument Phase 2 (IA): Phase 2 – innovation projects that address a specific challenge and demonstrate high potential in terms of company competitiveness and growth underpinned by a strategic business plan | Only SMEs can participate. Either a single SME or a consortium of SMEs established in an EU or Associated Country | New action |
| Specific Grant Agreement (SGA): The Financial Regulation provides the possibility of Framework Partnership Agreements for long-term partnerships and associated specific grant agreements. Framework Partnership Agreements and Specific Grant Agreements have been used in a limited way when in line with the objectives of the programme parts. | | - |
| OTHER INITIATIVES UNDER HORIZON 2020 | | |
| Prizes: Financial contribution given as a reward following the publication of a contest. Inducement prizes are a 'test-validate-scale' open innovation approach that brings together new and small players that may pursue more radically new concepts than large, institutionalised contestants. Inducement prizes offer an incentive by mobilising new talents and engaging new solver communities around a specific challenge. They are only awarded based on the achievement of the target set, solving the challenge defined. ‘Recognition prizes’ are used to recognise past achievements and outstanding work after it has been performed, whereas an ‘inducement prize’ is used to spur investment in a given direction, by specifying a target prior to the performance of the work. | Whoever can most effectively meet a defined challenge (future target or past achievement) | New action |
| Public-Public Partnerships also provided via the Article 185 initiatives: Article 185 of the TFEU allows the integration of national efforts into a programme undertaken jointly by several Member States, with the participation of the EU, including participation in the structures created for the execution of the joint programme. | EU Member States | - |
| Public-Private Partnerships: Support the development and implementation of research and innovation activities of strategic importance to the Union's competitiveness and industrial leadership or to address specific societal challenges. They take the form of Joint Undertakings under Article 187 of the TFEU and organise their own research agenda. Contractual PPPs, in which the activities take place under the umbrella of the Horizon 2020 work programmes, may also be supported. | Partnerships between public and private sector | - |
| Public Procurement: Supply of assets, execution of works or provision of services against payment | By means of tenders and subject to special procurement procedures |  |
| Financial instruments: Equity or quasi-equity investments; loans; guarantees; other risk-sharing instruments. Horizon 2020's financial instruments operate in conjunction with those of COSME. Strong synergies shall be ensured with the European Fund for Strategic Investments (EFSI) to create the maximum possible impact. Shall be the main form of funding for activities close to market under Horizon 2020. | FI are not directly implemented by the Commission (nor via the WP), but via EIB/EIF. | Replacing Risk Sharing Finance Facility |

|  |
| --- |
| Lessons learnt from Horizon 2020      "The Horizon 2020 funding model puts the focus on the costs that are directly related to the project. It was expected to simplify the financial management of projects, by a reduced complexity of the financial rules; reduce the financial error rate detected in ex-post audits; increase legal certainty for beneficiaries; increase the attractiveness and ease of access to the programme, in particular for newcomers, smaller actors, SMEs and industry; and contribute to the acceleration of the granting processes. The thematic assessments confirm that the expected benefits have largely materialised".  (p.54, In-Depth Staff Working Document on Horizon 2020 Interim Evaluation, SWD(2017) 220 final, May 2017).  "The new funding model has mobilised and largely satisfied stakeholders. It can also be assumed to have contributed to the attractiveness of Horizon 2020 as reflected in application statistics. For around 90% of universities and more than half of research organisations which have used in FP7 the 60% flat rate method for indirect costs, the Horizon 2020 funding model has brought little change compared to FP7 in terms of funding rate and has therefore not had any major impact on the participation pattern of research organisations and universities".  (p.56, In-Depth Staff Working Document on Horizon 2020 Interim Evaluation, SWD(2017) 220 final, May 2017).  Further simplification efforts and more flexibility are needed, for example concerning the additional remuneration scheme and the broader acceptance of beneficiaries' accounting practices. The additional remuneration scheme has been perceived by Member State representatives and stakeholders as being difficult to implement (see p.56 of the Staff Working Document), and as having a negative financial effect on those beneficiaries whose usual remuneration practices are based on very variable levels of remuneration. Broader acceptance of usual accounting practices (strengthening the current cases under Horizon 2020, with the future possibility to have other cases where the usual cost accounting practices of the beneficiary could be accepted) will be further explored. |

  

2.2What are the changes?

Funding model

The current funding model will be maintained. The Rules for Participation provisions will be complemented by clear guidance on use of the maximum funding rate, and the possibility to lower this in justified cases.

Types of action

The types of action under Horizon Europe, for example in the area of public-private and public-public partnerships, will be rationalised and will provide more flexibility for the applicant. An overview of continued, discontinued and new funding instruments can be found in 
[Table 16](#_Ref513044475)
 below.

For the forms of funding and types of action to be maintained under Horizon Europe, the level of detail within the current Rules for Participation, with some adjustments in the area of prizes, will be maintained. There will be no duplication with the EU Financial Regulation, which will serve as a single rulebook for all actions financed from the EU budget.

Table 16: Mapping of continued, discontinued and new instruments in Horizon Europe

|  |  |  |  |
| --- | --- | --- | --- |
| CONTINUED  Without Changes | CONTINUED  With Changes | DISCONTINUED | NEW |

|  |  |  |  |
| --- | --- | --- | --- |
| Design – Priorities | | | |
|  | ·Excellent Science: becomes Open Science pillar and does not include the FET specific objective  ·Societal Challenges: becomes Global Challenges and Industrial Competitiveness pillar and covers the LEITs specific objective of the Industrial Leadership pillar  ·EIT: becomes part of the newly created Open Innovation pillar | Industrial Leadership as a separate pillar | ·Open Innovation pillar  ·ERA foundation ("Strengthening the ERA") : covers SWAFs, Widening, which were separate specific objectives |
| Design - Specific objectives | | | |

|  |  |  |  |
| --- | --- | --- | --- |
| ·European Research Council  ·Marie Skłodowska-Curie Actions  ·Research Infrastructures  ·Direct Actions (Joint Research Centre)  ·Support to the European Institute of Innovation and Technology | ·Leadership in enabling and industrial technologies (becomes cross-cluster, though in particular in Digital and Industry cluster)  ·Innovation in SMEs, (included in European Innovation Council)  ·Societal Challenges 1-7 (becomes Clusters in the Global Challenges pillar)  ·Science with and for Society (becomes intervention areas within ERA foundation)  ·Spreading Excellence and Widening Participation (becomes Sharing Excellence, within ERA foundation) | ·Future and Emerging Technologies as separate label, but activities included in other parts  ·Fast Track to Innovation  ·Access to Risk Finance (moved to InvestEU programme) | European Innovation Council (building on EIC pilot) |

|  |
| --- |
| Implementation - instruments |

|  |  |  |  |
| --- | --- | --- | --- |
| ·Research and Innovation Actions  ·Innovation Actions  ·ERC frontier research  ·Training and mobility actions  ·Programme co-fund actions  ·coordination and support actions  ·inducement prizes  ·recognition prizes  ·public procurements  ·ERA Chairs  ·Twinning  ·Teaming  ·Policy Support Facility | ·Pre-commercial procurements (PCP) and Public procurement of innovative solutions (PPI) (becomes Coordinated innovation procurement)  ·SME Instrument (integrated into EIC Accelerator and transition activities)  ·Future and Emerging Technologies (FET) Open (becomes EIC Pathfinder)  ·Future and Emerging Technologies (FET) Flagships (incorporated within missions concept)  ·Support to Joint Programming Initiatives, ERA-NETs, Contractual Public Private Partnerships, Institutionalised public-private partnerships (Art. 187) and Institutionalised public-public partnerships (Art. 185): incorporated within European Partnerships initiative. |  | Missions  EIC pathfinder  EIC accelerator  EIC transition activities |

|  |  |  |  |
| --- | --- | --- | --- |
| Implementation – concepts | | | |
| ·Key Enabling Technologies  ·Integration of social Sciences and Humanities  ·Responsible Research and Innovation (Trying to drop this term – better to treat the components separately)  ·Communication  ·Gender Equality  ·Ethics standards | ·International cooperation (new criteria)  ·Strategic planning – widened to include the R&I activities from other funding programmes  ·Governance |  |  |

2.3What are the expected implications of the changes?

Funding model

The proposed changes would:

·Provide continuity with the current situation, complying with the principles of the Financial Regulation.

·Be positively perceived by recurrent Horizon 2020 beneficiaries

·Facilitate access to the programme for beneficiaries who have difficulties to get other sources of funding for their projects, possibly increasing the number of newcomers and covering a wider range of potential beneficiaries.

However some of the difficulties experienced in Horizon 2020 to date, notably on oversubscription to calls, would most likely continue (alternative ways to address oversubscription are also identified in section 3.4 of the Impact Assessment).

Types of action

The proposed changes would ensure stability while taking account of the lessons learned from Horizon 2020 so far, for example the need to rationalise the number of existing EU funding instruments for research and innovation. It would better suit participants' needs by applying simplified forms of funding; thus streamlining further the EU R&I funding landscape. Thus, the result would be a more user-friendly set of EU funding schemes for R&I, coherence with the EU Financial Regulation and greater complementarity between instruments.

2.4What alternatives have been considered?

Funding model

A single reduced funding rate for all projects (75% funding rate) and linking the flat rate for indirect costs to personnel costs based on an optional unit cost was considered. This could reduce oversubscription (as a higher number of beneficiaries could benefit from EU funding), further simplify the current rules (i.e. no differentiation between funding rates for Research and Innovation Actions and Innovation Actions) and enhance opportunities for newcomers. However, the reduction of the funding intensity would lower the overall attractiveness of the programme, especially for non-profit entities and SMEs, and would negatively affect the principle of excellence.

Different levels of funding for industry compared to other types of beneficiaries were also considered. The funding rates for industry evolved from 50% in FP7 (with a possibility to charge real indirect costs) to 100% (70% in innovation actions) in Horizon 2020 (with a 25% flat rate for indirect costs). Doubling of the nominal funding rate in Horizon 2020, in combination with the 25% flat rate for indirect costs (and no real indirect costs), has had a positive effect in attracting industry and only a minor impact on the effective funding rate for industry. Having a separate (lower) rate for industry could release funds to increase the number of grants and to offer further possibilities for newcomers. However, the introduction of a different funding rate for industry would have a negative impact on industry participation, time-to-grant and would work against the drive for simplification.

3 Forms of grants

3.1What is the current situation under Horizon 2020?

|  |
| --- |
| FACTS |
| Different forms of grants [205](#footnote206)  are provided for under the current EU Financial Regulation and used by the Horizon 2020 programme. |

To reduce the complexity of the funding rules, Horizon 2020 features a "simplified cost reimbursement system with enhanced use of lump sums, flat rates and unit costs"
[206](#footnote207)
.

Actual costs (i.e. costs actually incurred by beneficiaries) are the most widely used. Unit costs are used in relation to personnel costs (i.e. for average personnel costs and SME owners without a salary), other direct costs (i.e. internal invoices) and for MSCA, while flat rates are used for the indirect costs. Lump sums are used, for example within Phase 1 of the SME Instrument).

|  |
| --- |
| Lessons learnt from Horizon 2020  "The range of funding schemes for R&I across the EU budget is numerous, complex and not accessible enough…a minimum objective should be to eliminate one third of R&I funding schemes, instruments and acronyms across the landscape" (LAB-FAB-APP: Investing in the European future we want, Report of the High Level Group on maximising the impact of EU research and innovation programmes, July 2017).      "The use of new instruments such as the pre-commercial public procurement (PCP), public procurement for innovation (PPI) and inducement prizes clearly aim at leveraging demand for future solutions. Evidence of outputs so far is however still lacking on the effects of the PCP and PPI, since the first projects were signed only in 2015….overall more could be done to support demand for innovative solutions and user-driven innovation" (p.110, In-Depth Staff Working Document on Horizon 2020 Interim Evaluation, SWD(2017) 220 final, May 2017).   Due to the perceived need to focus more on performance rather than auditing of spending, there is a general interest to simplify funding and shift the focus from the reimbursement of costs to the implementation of defined activities. The main step is the new Financial Regulation, whose main purpose is to facilitate and stimulate, as far as possible, the simplified forms of grants. Further simplification of the current actual cost reimbursement system is necessary, in particular in the area of personnel costs. |

3.2What are the changes?

There will be specific provisions on forms of Union contribution (as described under Article 125 of the new Financial Regulation) within the Rules for Participation. These provisions will include, as exists today, the reimbursement of actual costs, flat rate costs and increased use of lump-sum costs (building on the lump-sum pilot under Horizon 2020) and prizes. In addition, the funding of Marie Skłodowska-Curie Actions, fully based on unit costs, will be continued, and other forms of Union funding will be considered.

For projects funded mainly on the basis of incurred costs, the current unit cost options (average personnel costs, internally invoiced goods and services, SME owner unit cost, clinical studies, etc.) calculated in accordance with the beneficiary's usual practices
[207](#footnote208)
 will be maintained. In addition, the unit cost for internally invoiced goods and services will allow for a higher acceptance of usual cost accounting practices. This means that beneficiaries will be able, under certain conditions
[208](#footnote209)
, to calculate unit costs based on actual direct and indirect costs. Public procurement instruments will be aligned to the new Financial Regulation, while some specificities are provided for pre-commercial procurement and procurement of innovative solutions.

|  |  |
| --- | --- |
| Issue | Planned status within Horizon Europe Programme |
| Actual costs | |
| Rules on personnel costs | The current Horizon 2020 system of reimbursement of actual personnel costs will be simplified and, where possible, further aligned with the Financial Regulation: the distinction between basic and additional remuneration will be removed and the Horizon 2020 capping on additional remuneration of EUR 8.000 per person per year abolished.  At the same time, building on Horizon 2020, the costs of personnel will be eligible up to the remuneration that the person would be paid for the time worked in projects funded by national schemes. |
| Eligibility of costs from third parties | The system of in-kind contributions provided by third parties to beneficiaries will be further aligned to the Financial Regulation: in-kind contributions against payment will be treated and reimbursed according to the conditions set out in this Regulation.  The possibility for beneficiaries to declare costs of in-kind contributions provided by third parties (free-of-charge) will be kept and further simplified. Beneficiaries will be able to declare costs related to in-kind contributions provided by third parties (free-of-charge) as eligible up to the direct eligible third parties’ costs. Therefore, no distinction as to whether these resources (e.g. seconded persons, contributed equipment) are used on the beneficiaries or third parties’ premises will be necessary any longer.  In addition, the obligation to declare such costs as receipts will be removed in light of the provisions of the Financial Regulation. |
| Flat rate costs | |
| Indirect costs | The current Horizon 2020 flat rate of 25% for indirect costs will be maintained. |
| Lump sum costs | |
|  | The use of lump sums will be increased based on the experience of the lump sum pilot projects under Horizon 2020. |
| Unit costs calculated in accordance with the beneficiary's usual accounting practices | |
|  | The current provisions for unit costs (i.e. average personnel costs and costs of internally invoiced goods and services) will be maintained. In addition, the unit cost for internally invoiced goods and services will allow for a higher acceptance of the usual cost accounting practices by allowing beneficiaries, under certain conditions – to be set out in the grant agreement - to calculate such unit cost based on 'actual direct and indirect costs'. |
| Unit costs for MSCA | |
|  | The current system of unit costs will be maintained (not excluding the use of other forms of Union funding). |
| EU financing not linked to costs | |
|  | The topics where this form of Union contribution could be used will be identified in the Specific Programme or in the Work Programme. Further details will be set out in subsequent Commission procedure as indicated in the revised Financial Regulation. |
| Operating grants | |
|  | No specific references in the Rules are necessary to conclude operating grants (which could be specified within the Work Programme). |

3.3What are the expected implications of the changes?

These changes would provide legal certainty and consistency by offering the complete set of forms of grants set out in the Financial Regulation to beneficiaries, but outlining the choice of the most appropriate one in the Work Programme. This is also expected to improve and simplify reimbursement of actual costs, while providing flexibility.

3.4What alternatives have been considered?

|  |  |
| --- | --- |
| Alternative considered | Reason not favoured |
| Rules for personnel costs | |
| Provide for an optional unit cost (hourly rate) set out by the Commission for all EU and Euratom programmes. | This would not help deliver the objective of broadening opportunities for participants of the Framework Programme and increasing the leverage effect of the EU funding. |
| Provide for a unit cost (hourly rate) calculated by the beneficiary based on the average salary of the person in the previous year. | This would require detailed rules to determine the formula to be applied. |
| Payment of the personnel costs against certain conditions, by fixing an amount to cover the personnel costs for the work done in the project. | This would imply replacing the actual cost system with contribution not linked to costs; however, given the diversity in salary costs across the Union, it would not be possible to set out a fixed amount for personnel across Europe. |
| Eligibility of costs from third parties | |
| Fully align to the Financial Regulation by considering in-kind contributions as part of the co-financing and therefore as ineligible costs. | This would imply a significant change and a potential financial loss for beneficiaries, in particular for universities of many Member States whose professors are paid by the ministries. Thus this would be challenged by Member States, research beneficiaries and stakeholders. |

4 Further simplification/flexibility

4.1What is the current situation under Horizon 2020?

|  |
| --- |
| FACTS |
| Simplification of rules and procedures is a central guiding principle of Horizon 2020, and is fully reflected in the programme's design, rules, financial management and ways of implementation. The aim has been to make the programme simpler and more attractive, in particular to newcomers. |
| Significant simplification has resulted in the single reimbursement rate, the flat rate for indirect costs, the improved Participant Portal and the electronic grant management processes. |
| The Lump Sum pilot is the main element of the second wave of simplification of Horizon 2020. It will test two options for lump sum funding in the 2018/2020 Work Programme. |

|  |
| --- |
| Lessons learnt from Horizon 2020  The Lamy Report recognises the "remarkable simplification achieved" in the context of Horizon 2020. It identifies areas for further simplification for Horizon Europe in order to: (i) make the Participant Portal website a “one-stop-shop” for all steps from application to final reporting; (ii) give participants the choice between cost-based and lump-sum funding; and (iii) further simplifying administrative processes along the project cycle.  The Horizon 2020 Interim Evaluation highlights that simplification is a continuous endeavour, and identifies possible areas for improvement, such as the broader acceptance of beneficiaries' usual cost accounting practices or the more extensive use of simplified forms of funding (unit costs, flat rates, lump sum). This is in line with the new Financial Regulation and the EU Budget Focused on Results initiative.  The European Court of Auditors, in its briefing paper on "A contribution to simplification for research beyond Horizon 2020" [209](#footnote210) , identifies among other things the "following proposals to be considered to bring more focus on the discussion in Horizon Europe that is taking place now: (i) further use of simplified cost options, such as lump sums and prizes; (ii) accepting beneficiaries' accounting practices. |

4.2What are the changes?

Based on the achievements of Horizon 2020, Horizon Europe will aim for further simplification of rules for beneficiaries. This is fully in line with the overall objective of the next EU budgetary cycle to have simple and effective common rules across Programmes, with adequate flexibility in justified cases. The changes are:

·A wider/greater cross-reliance on audits and assessments – with other EU programmes – is envisaged if the costs can be audited or assessed against the same set of rules.

·Broader acceptance of beneficiaries' usual cost accounting practices, in order to reduce the administrative burden on beneficiaries who will be able to identify their cost components via their own trusted methods.  

·Increased use of lump sums is based on the lessons learned from the lump-sum pilot within the 2018-2020 calls under Horizon 2020. In addition, although not specifically mentioned in the Rules, the two current unit costs calculated in accordance with the beneficiary's practices (average personnel costs and internal invoices) will be maintained.

·The unit cost for internally invoiced goods and services will allow for a higher acceptance of the usual cost accounting practices by allowing beneficiaries, under certain conditions (to be set out in the grant agreement) to calculate this based on 'actual eligible direct and indirect costs'.

·Secure electronic system will be maintained: the use of a tool for providing secure electronic interaction (currently the Participant Portal) should be made mandatory, in accordance with the Financial Regulation. The Participant Portal will also be extended to other EU programmes.

·To address oversubscription, a broader use of multi-stage submission could be explored..

·Simplification measures should also address Article 185 initiatives, e.g. potential inclusion in the Participant Guarantee Fund and the ex-post audit coverage by the Common Audit Service.

4.3What are the expected implications of the changes?

·The expected reduction of audit efforts should decrease administrative buden and costs for beneficiaries, as well as for Commission services.. Implementing additional automated checks and tools for simpler entry of data will also have a positive impact where beneficiaries need to submit information to EC.

·Increased alignment to the Financial Regulation on actual costs, broader use of simplified forms of costs and of acceptance of beneficiaries' usual cost accounting practices will make Horizon Europe less burdensome and more attractive. Further acceptance of the beneficiaries’ usual cost accounting practices will reduce the error rate on issues that have seen recurrent and repetitive errors under FP7 and Horizon 2020.

·Further simplification due to increased use of lump sums under Horizon Europe. The use of lump sums reduces substantially the administrative burden during the lifetime of the project, shifting the focus of project monitoring from financial checks to performance and content.

·The improvements to the Participant Portal, the single entry point for information providing secure electronic interaction, will offer easier access to the programme. Further improvements of the interfaces, guidance documents, as well as the online version of the Annotated Model Grant Agreement will similarly allow for easier access to information. Integration of ex-post audit support into the Portal will enable a clearer view on the progress of audits and allow for completely electronic exchange of documents and notifications, thus reducing administrative burden and costs.

4.4What alternatives have been considered?

Several alternatives to the simplification measures were considered, and several additional measures may be introduced during Programme implementation.

5Use of grants, financial instruments and budgetary guarantees

5.1What is the current situation under Horizon 2020?

|  |
| --- |
| FACTS |
| More than 90% of the Horizon 2020 support is grant based. Less than 10% of support is provided through financial instruments, such as debt and equity. |
| Horizon 2020 invests €400 million per year in risk financing, through the European Investment Bank  . This is, however, less than 10% of Horizon 2020's overall budget. |

Grants are the most widely used and appropriate form of public support for early stage research and innovation projects. Financial instruments are used for projects closer to the market.

|  |
| --- |
| Lessons learnt from Horizon 2020  Only a small number of companies receiving Horizon 2020 grants benefit from such financial instruments, and the programme lacks genuine connections between grant and loan-based financing for companies.  A key aim of the Horizon 2020 financial instruments is to finance R&I projects closer to the market. But the analysis of Technology Readiness Levels (used to measure the maturity level of innovation) illustrated that the financial instruments financed an equal share of projects with lover level of maturity (TRL 1-3), medium level of maturity (TRL 4-6) and higher level of maturity (7 – 8).  "Overall, the InnovFin scheme is performing well against its objectives of improving access to finance for innovative companies and projects, and helping to address related market failures. To the extent that shortcomings have been identified, these are more to do with the implementation of particular InnovFin schemes than being inherent programme design faults" (p.467, Annex 2 of Staff Working Document on Horizon 2020 Interim Evaluation, SWD(2017) 221 final, May 2017). |

5.2What are the changes?

Horizon Europe aims to increase the number of young, highly innovative European companies that can scale up rapidly and grow into leading, market-creating innovators worldwide.

The availability of flexible, agile funding is a key mechanism that enables scaling up. However, Europe's innovators, currently cannot access risk finance above the €10 million range. The supply of flexible funding, such as blended finance (combining grants with loans or equity) or crowdfunding, is insufficient. European investors are more cautious than their American counterparts and are typically focused on smaller amounts. The European stock markets provide insufficient source of finance
[210](#footnote211)
.

As a result, a major concern for Horizon Europe is to increase the willingness of private investors and lenders to commit to these young, highly innovative European companies. Blended finance will help. Combining grants with equity, loans, soft loans or guarantees, this allows for blending simultaneously, for example, as a grant-plus-equity package . Sequential blending is also possible, as when a grant attracts a later investment by a Venture Capital fund, business angel or corporate Venture Capital arm, or facilitates a loan from a bank or a non-bank lender.

5.3What are the expected implications of the changes?

·Blended finance will increase the availability of large-scale risk finance in Europe;

·The leverage of EU R&I funding is expected to increase through measures put in place to stimulate private finance for instance through hard blending;

·Increased risk taking for breakthrough innovation by de-risking technical, commercial or company failure.

5.4What alternatives have been considered?

Providing grant based support through Horizon Europe and financial instruments through the InvestEU single fund:

§In Europe, financial intermediaries (banks and investors) remain averse to the risk when investing in high-risk innovative projects. Therefore, available private and corporate financing remains small for innovation activities and market take-up for breakthrough innovations, as financial institutions must limit their risks to maintain their market rating. There is hence a necessity for direct Union intervention. Innovation will thus be reinforced by the InvestEU single fund, providing indirect financial instruments carried out through the European Investment Bank Group or other implementing partners, with a dedicated window for R&I investments and specific products for innovative companies.

§Providing grants only allows lowering the risk of operations and attracting private or corporate finance. This is only partially the case, as some activities too close to market, including deployment and scale-up, may not be covered by grants. However, the alternative of awarding blended finance to a project by allocating grant-type funding (through the Framework Programme) and financial instruments (through InvestEU) might not be fully adapted to the needs of risky breakthrough innovators who need to proceed to the market quickly..

6Proposal selection and evaluation, including experts

6.1What is the current situation under Horizon 2020?

The approach for the evaluation and selection of proposals submitted to Horizon 2020 calls is to ensure a maximum of coherence across the different implementing bodies, with three standard evaluation criteria outlined in the Rules for Participation. Details of the evaluation criteria, weighting and thresholds, as well as additional eligibility criteria, are laid out in the Work Programmes. As regards the appointment of independent experts to evaluate proposals (and other tasks), the key provisions are set out in the Horizon 2020 Framework Programme Regulation rather than the Rules for Participation.

|  |
| --- |
| FACTS |
| Three criteria against which proposals are evaluated – Excellence; Impact; Quality and Efficiency of the Implementation (with Excellence only for the European Research Council calls). |
| There is a higher weighting for Impact within Innovation Actions calls. |
| Independent experts shall be chosen on the basis of their skills, experience and knowledge appropriate to carry out their tasks. When appointing, the Commission shall seek a balanced composition within the expert groups and evaluation panels in terms of various skills, experience, knowledge, geographical diversity and gender. Where appropriate, private-public sector balance shall also be sought. |

|  |
| --- |
| Lessons learnt from Horizon 2020  "There is room for improvement in the current evaluation process. The thematic assessments….highlight dissatisfaction with application procedures, proposal evaluation and selection and reporting procedures. In addition they note that the quality of feedback provided to applicants is an area for improvement. This is also reflected in the stakeholder consultation results, where 62% of respondents assess the quality of the feedback from the evaluations as “good” or “very good”, while 34% judged it as “poor” or “very poor”. Some respondents ask for more transparency and an improved quality of the evaluation feedback they receive. Respondents complain that not enough details are provided, that the quality of the feedback varies greatly from one evaluation panel to the other, and that discordant views can be provided to the participant.  In their position papers, some stakeholders from academia, research organisations, public authorities and business commented on the evaluation process and noted that the quality of the current process should improve. A variety of issues was highlighted, in particular: the Evaluation Summary Reports are reportedly too short and provide generic and not tailored feedback. A few stakeholders noted […] evaluation committees should have a balanced representation of stakeholders including industry, business participants and SSH experts. Business representatives further noted that the selection rules of expert panels, especially around conflicts of interest, seem to dissuade industry experts as evaluators; evaluators should have the necessary expertise and training, while consensus meetings should be reintroduced". (In-Depth Interim Evaluation of Horizon 2020, SWD(2017) 220 final)  "A modernised proposal evaluation system should attract different types of evaluators. Evaluation teams should consist of top people with broad experience well-matched to the call or mission and different competences to evaluate excellence and impact. Resources should be invested in providing meaningful evaluation feedback to applicants, including on the choice of funding instrument". (p.15, LAB-FAB-APP, July 2017).   "The Council invites the Commission to develop the evaluation process further by e.g. promoting diversity in evaluation panels, piloting blind evaluations, where possible".  (p.8, Council Conclusions "From the Interim Evaluation of Horizon 2020 towards the Ninth Framework Programme", December 2017)  "The European Parliament calls for better and more transparent evaluation and quality assurance by the evaluators; stresses the need to improve the feedback given to participants throughout the evaluation process and urges that complaints made by unsuccessful applicants that the Evaluation Summary Reports (ESRs) lack depth and clarity on what should be done differently in order to succeed be taken into consideration; calls on the Commission, therefore, to publish, in conjunction with the call for proposals, detailed evaluation criteria, to provide participants with more detailed and informative ESRs and to organise calls for proposals in such a way as to avoid excessive oversubscription, which badly affects researchers’ motivation and the reputation of the programme". (p.13, European Parliament Report on the assessment of Horizon 2020 implementation in view of its interim evaluation and the Framework Programme 9 proposal, June 2017) |

6.2What are the changes?

Proposal selection and evaluation

A similar level of detail on the evaluation and selection of proposals should be maintained in the legal acts and call documents of Horizon 2020, with small changes in order to address lessons learned and the specific features of Horizon Europe. Based on the specific recommendations coming from the Horizon 2020 Interim Evaluation, the following issues will be addressed in the design of the new programme:

·Differentiate the evaluation process according to objectives of the calls.

·Allow for differentiation of expertise within evaluation stages, where appropriate.

·Provide flexibility and allow for experimentation.

Thus the provisions retained in the Rules for Participation include:

·Clarified time-to-grant and time-to-inform milestones.

·Outlined award criteria - Excellence, Impact, and Quality and efficiency of the implementation, with the only exception of the ERC, where the sole criterion of excellence will apply.

·The possibility for selection to take into account factors beyond proposal-by-proposal evaluation (for example, a mechanism to ensure a coherent portfolio of projects).

·Possible selection on first-come-first-served basis (i.e. no ranking of batches).

·The main aspects of the proposal review procedure.

Experts

The rules on appointment of external experts are further aligned to the Financial Regulation. Therefore, the following provisions are included in the Rules for Participation for Horizon Europe:

·Selection criteria: independent experts may be selected without a call for expression of interest, if justified, and the selection is carried out in a transparent manner;;

·Appropriate remuneration;

·The publication of the names of external experts evaluating grant applications.

6.3What are the expected implications of the changes?

Experience under Horizon 2020 has made clear the advantage of keeping certain principles fixed across the board, while adjusting the arrangements via the Work Programme. There are no obvious reasons for departing from this approach under Horizon Europe. Furthermore, many of the deficiencies noted (inadequate evaluation feedback; need for a broader pool of experts) should be addressed by the business processes – rather than by provisions in the Rules for Participation.

More widely, the changes detailed above would ensure necessary coherence across the programme but balanced with flexibility (in line with the guiding principle of “evolution not revolution”) – thus enabling further simplification, addressing the lessons learned from the interim evaluation of Horizon 2020 and the Lamy Group report, whilst preparing for expected new features under Horizon Europe.

6.4What alternatives have been considered?

Firstly, the possibility to specify in further detail the criteria for evaluation and selection of proposals in the Rules themselves (at a similar level of detail as in current Work Programme annexes) was considered. This would ensure a high degree of coherence across Horizon Europe. Different approaches between instruments could still be included in the Rules, but exceptions and derogations would all but disappear. This would provide a measure of stability for applicants. However, it would be virtually impossible to adapt the rules according to experience gained – nor experiment with new approaches. As such, there would be significant loss of flexibility.

Secondly, the possibility to move all or most of the rules out of the Rules for Participation (to the Work Programme, for example) was considered. This would lighten the legislative process, and would be more in line with wider Commission processes. However, with a programme of the breadth of Horizon Europe, and given the experience of Horizon 2020 and previous programmes, it is important to fix certain rules to ensure overall coherence and to avoid re-opening fundamental principles with every set of calls. This approach would maximise flexibility, but it would risk a divergence of rules in practice, jeopardise smooth business processes, and lead to unpredictability for applicants.

7Audits and controls

7.1What is the current situation under Horizon 2020?

|  |
| --- |
| FACTS |
| A simplification measure introduced for Horizon 2020 was to reduce the audit burden on participants through an ex-post control strategy which emphasises risk-based control and fraud detection. |
| The maximum length of time for an audit after the final payment to a Horizon 2020-funded project was reduced from five years to two years. |
| The Horizon 2020 ex-post audit function has been centralised in the Common Audit Service within the Common Support Centre (part of DG Research and Innovation) serving all the Horizon 2020 stakeholders |

The internal control system as a whole is supported by the Financial Regulation, which identifies the responsibility of the Authorising Officers for the control of budget implementation at programme level. This includes the calculation of the error level and the consequent corrective measures.

According to the existing Financial Regulation "each operation shall be subject at least to an ex- ante control". Nevertheless, the extent in terms of frequency and intensity of the ex-ante controls shall be determined by the Authorising Officer taking into account risk-based and cost-effectiveness considerations.

The ex-post financial audit rules shall be clear, consistent and transparent and that the Commission shall ensure equal treatment of beneficiaries of a programme, in particular where it is implemented by several Authorising Officers.

The Horizon 2020 control framework is based on the following elements:

·Operational capacity and financial viability checks: Article 15 of the Horizon 2020 Rules for Participation and Dissemination states that this is required only for project coordinators when the requested EU contribution is equal or superior to €500,000, or when there are grounds to doubt the financial capacity of participants. It will not be verified for entities guaranteed by a Member State (or an associated country), or by any other legal entity whose financial capacity shall in turn be verified, or for higher or secondary education establishments.

·Certificate on Methodology to calculate Unit Costs: Participants that calculate and claim direct personnel costs on the basis of unit costs, in accordance with the Horizon 2020 Rules for Participation, may submit to the Commission a certificate on the methodology (CoMUC). This must comply with the conditions set out in Article 33(2) of the Rules for Participation and Dissemination
[211](#footnote212)
 and meet the requirements of the grant agreement. Where the Commission accepts a certificate on the methodology, it shall be valid for all actions financed under Horizon 2020 and the participant shall calculate and claim costs on this basis. Once the Commission has accepted a certificate on the methodology, it shall not attribute any systemic or recurrent error to the accepted methodology. However, the certificate is optional has seen very low interest to date.

·Certificate of Financial Statements (CFS): In Horizon 2020, a CFS is required when an amount claimed by a beneficiary for actual/unit costs calculated on the basis of the beneficiary's usual cost accounting practices is equal or greater to €325,000. This is a derogation from the current Financial Regulation, which states that a CFS is only required if the total grant amount is EUR 750,000 or more, and that a CFS may also be demanded on the basis of a risk assessment by the Authorising Officer. The Horizon 2020 CFS (as the CFS under FP7) is based on “agreed upon procedures” instead of an “audit opinion”.

·Ex-post audits are an important part of the overall control framework and provide inputs to the ex-ante checks. The Horizon 2020 Audit Strategy is supported by the existing Financial Regulation and the Horizon 2020 Regulation.

·Acceptance of usual of Cost Accounting Practices: Under Horizon 2020, the Commission set out certain unit costs on the basis of the usual cost accounting practices of beneficiaries (i.e average personnel costs and internal invoices) under certain conditions detailed in the MGA. This concept is also used when referring to beneficiaries' records in the accounts: i.e. beneficiaries must record actual costs in accordance with their usual cost accounting practices. However, those provisions have to be compatible with the other Horizon 2020 eligibility criteria..

In addition, the simplified funding model (see Annex 9, section 2) introduced for Horizon 2020 is expected to reduce the financial error rate detected in ex-post audits, although when the Horizon 2020 interim evaluation was carried out in mid-2017 no ex-post audits had yet been completed.

|  |
| --- |
| Lessons learnt from Horizon 2020  "In order to reduce the audit burden, the obligation to provide representative ‘error rates’ for the programme should be dropped. Audits should only be carried out when there is a suspicion of fraud or serious financial wrongdoing on a project". (LAB-FAB-APP: High Level Group report, July 2017).   "The effects on the simplification of financial management in the projects and on the error rate cannot yet be assessed, as very few financial reports were yet submitted and no ex-post audits were yet finished".  (p.57, In-Depth Horizon 2020 Interim Evaluation, SWD(2017) 220 final, May 2017).   Several beneficiaries have repeatedly expressed the need for having their processes confirmed in order to obtain comfort on their reporting. Experience has shown that the current way of auditing under both FP7 and Horizon 2020 does not necessarily provide this assurance to the beneficiaries since the current audit process focuses only on costs declared and not on the beneficiaries systems and their overall accounting practices. |

7.2What are the changes?

The overall objectives remain the following:

·Effectiveness, efficiency and economy of operations;

·Adequate management of the risks relating to legality and regularity, taking into account the multiannual character of programmes and the nature of the payments concerned.

Specific changes include:

·Certificate on Methodology / Systems and Process audits: Under Horizon 2020, the Certificate on Methodology to calculate Unit Costs (CoMUC) was optional and the beneficiaries have shown low interest to date, resulting in very little added value as ex-ante controls. In addition, applying for a CoMUC is complex and burdensome. Therefore, it is envisaged to remove the existing CoMUC. Alternatively, a procedure under which beneficiaries may opt to have their systems and processes audited - under conditions to be set out in the Model Grant Agreement - is proposed.

·Certificate of financial statements (CFS): The new Financial Regulation does not set any limit. The CFS may be demanded by the Authorising Officer on the basis of a risk assessment. The use of CFS might be broadened in order to provide more assurance, or narrowed as a simplification measure (reduction of administrative burden). Considering the CFS has proved in Horizon 2020 to be a relatively effective ex-ante control (with cost claims with a CFS having on average an error rate 50% lower than those without), it is proposed that the CFS remains mandatory under similar conditions as under Horizon 2020 (thresholds, cost covered).

·Ex-post audits: the approach under Horizon 2020 is successful and should be maintained; although the intensity of ex-post controls may be adapted..

·The cross-reliance on assessments and audits: The explicit reference to this principle in the new EU Financial Regulation allows for broadening its use by accepting other audits (i.e. audits of other EU programmes) as a basis for the assurance to be obtained by the Responsible Authorising Officers. This requires that the costs could be audited or assessed against the same set of rules. In addition, taken into account the balance between trust and control, it is proposed that the opportunity of performing ex-post audits should be reconsidered.

·Ensuring equal treatment of beneficiaries when implementing the Framework Programme: In order to strengthen this common approach, a "coordination and monitoring mechanism" is currently under design and will be effective as of 2018 for Horizon 2020. This is is expected to be extended to Horizon Europe.

·Acceptance of usual of cost accounting practices: While attractive from a simplification perspective, the acceptance of usual cost accounting practices presents important challenges since neither international nor national standards/rules exist defining a minimum core benchmark of what is an acceptable set of “usual cost accounting practices”. As for Horizon 2020, the usual cost accounting practices of beneficiaries can be accepted under certain conditions to be detailed in the Model Grant Agreement. Those conditions have to be compatible with the new Financial Regulation and eligibility criteria of Horizon Europe.

7.3What are the expected implications of the changes?

While the reduction of the audit burden is a shared objective for beneficiaries, Commission and implementing bodies, the expected implications are:

·An alignment of the rules with other EU funding programmes will allow the beneficiaries to apply in a harmonised way their usual accounting practices. This will result in a smoother audit approach since the costs will be audited or assessed against the same set of rules.

·Specific features on the Certificates of Financial Statements (thresholds, frequency…) are foreseen in the Rules, which will result in a lower audit burden for beneficiaries.

·Further efforts in the area of ex-ante controls (through implementing additional automated checks and tools for simpler entry of the data) will have a positive impact where beneficiaries need to submit information to the Commission. The integration of ex-post audit support into the Participant Portal will enable a better view of progress of audits andallow for completely electronic exchange of documents and notifications.

7.4What alternatives have been considered?

It can be envisaged to identify possible common benchmarks / principles or best practices for a broader acceptance of usual cost accounting practices of beneficiaries from different sectors and/or different countries.

The concept of cross-reliance on other audits or assessments with other EU programmes was considered, however its effectiveness depends on the coherence of rules between programmes. Identifying possible common benchmarks / principles or best practises for a broader acceptance of usual cost accounting practices of beneficiaries from different sectors and different countries can be further explored as a second alternative with the aim of moving from a rule-based approach towards a principle-based one.

Such a challenging alternative would be possible, only once having taken into account the eligibility criteria of the different EU programmes. 

8Intellectual Property Rights, including “Exploit in the EU” 

8.1What is the current situation under Horizon 2020?

|  |
| --- |
| FACTS |
| 498 Intellectual Property Right (IPR) applications arising from Horizon 2020 projects have been submitted, of which 212 were awarded. This mainly consists of patents (408 applications and 141 awards) and trademarks (66 applications and 50 awards). These numbers [212](#footnote213)  will greatly increase as more projects under Horizon 2020 are completed. |

The Horizon 2020 rules relating to dissemination and exploitation were largely built on the rules of the FP7 Programme: the same level of detail was maintained and the balance of interests between the different types of participants was not fundamentally altered.

Apart from simplification measures, changes were mainly introduced due to new policy objectives (e.g. open access to scientific publications), the inclusion of innovation (e.g. possibility to lay down additional exploitation obligations, publicly known as "Exploit in the EU first"), the need for specific rules deviating from the general framework in certain areas (e.g. security research) and new forms of funding (e.g. pre-commercial procurement).

The general rule in Horizon 2020 for exploitation obligations is that participants, having received EU funding, must use their best efforts to exploit their results, without any further conditions. 'Exploitation' is broadly defined.

Therefore, participants enjoy a large degree of flexibility when deciding how, where and by whom to exploit. Additional exploitation obligations may be laid down within the grant agreement, if foreseen in the Work Programme. Beneficiaries must report on their dissemination and exploitation activities during the project.

|  |
| --- |
| Lessons learnt from Horizon 2020  There is no major support for fundamentally different rules but some areas of improvement have been identified. Recently, national representatives and other stakeholders have also underlined a need to strengthen the rules requiring that Horizon 2020 project results should be exploited preferentially in the EU. Furthermore, the European Parliament resolution of June 2017 on the "assessment of Horizon 2020 implementation in view of its interim evaluation and the Framework Programme 9 proposal" stressed that "FP9 for R&I should strengthen societal progress and the competitiveness of the EU, creating growth and jobs and bringing new knowledge and innovations in order to tackle the crucial challenges faced in Europe, as well as delivering further progress in developing a sustainable ERA".  Feedback from R&I projects to other beneficiaries and policy-making must be strengthened, requiring also reporting after the end of the project on the dissemination and exploitation activities of beneficiaries, as those activities often take place after the end of the project. Moreover, if beneficiaries cannot successfully exploit their results, they should pro-actively seek that others are given the opportunity to exploit these results, including through an appropriate online platform.  The Horizon 2020 rules require that the Commission be given an opportunity to assume ownership of, and protect, any results that a participant would not wish to protect or for which they want to abandon protection or not extend protection (subject to various conditions). This requirement is perceived as an administrative burden and probably being complied with to a widely variable degree, as the notifications remain rather low. Moreover, experience has shown that if participants do not wish to protect, protection by the Commission is not considered appropriate either.  In Horizon 2020, joint owners may only agree not to continue with joint ownership after the results have been generated. This constraint was introduced during the legislative process to help less experienced participants (but the actual benefits are unclear). However, it means that no comprehensive agreement can be reached before the start of the project. This creates legal uncertainty having a negative impact on the cooperation required in multi-partner projects and may lead to a lower quality of projects/results. Moreover, this rule creates the illogic discrepancy that a participant may agree before the results are generated to transfer results it will solely generate but not results it will jointly generate. Restoring flexibility and offering guidance for beneficiaries to understand the issues at stake to help them to reach appropriate agreements for their specific project seems the best way forward. |
|  |

8.2What are the changes?

Most provisions of the Horizon 2020 rules will be maintained, with further simplification and improvements. This would entail:

·Reinforcing the focus on exploitation in particular in the Union, as a general rule, while keeping the possibility for exploitation outside the Union and additional exploitation obligations at Work Programme level.

·Specifying that the dissemination and exploitation plans must be updated during the project and after its end: the plan should contain a credible strategy if the expected exploitation entails developing, creating, manufacturing and marketing a product or process, or in creating and providing a service.

·Providing for the possibility to require reporting regarding the beneficiaries’ dissemination and exploitation activities beyond the life time of the R&I projects.

·Removing the requirement to notify the Commission if no protection of results is sought, or if protection is abandoned or not extended.

·Removing the prohibition to agree on a regime other than joint ownership before results are generated;

·In view of the shortcomings in exploitation, beneficiaries which do not succeed in exploiting their results, need to use an appropriate online platform to seek exploitation by others. 

8.3What are the expected implications of the changes?

·These refinements to the IPR rules would help to ensure that the rules under Horizon Europe are fully fit-for-purpose.

·Improving legal certainly for participants and providing further simplification and flexibility.

8.4What alternatives have been considered?

|  |  |
| --- | --- |
| Alternative considered | Reason not favoured |
| Intellectual Property Rights (IPR) – general rules | |
| Not to have detailed IPR rules, but lists of principles | This would be a radical shift from recent programmes and would be criticised by stakeholders - especially since it would force participants to negotiate all IPR provisions from scratch before starting a project, and could result in projects not having the necessary rules in place with a detrimental effect on the implementation of the project and the exploitation and dissemination of its results. |
| Include detailed IPR rules and fundamentally alter the balance of interests between the different type of participants | Such a shift does not seem justified given that most types of participants are of the opinion that the current rules are relatively well balanced. |
| Exploit in the EU first | |
| Not to have any 'protectionist' rules or provisions | Having no rules at all is not favoured as this approach does not guarantee that the Union will benefit from the exploitation of results. |
| Apply more stringent 'protectionist' rules across the board. | Having a more stringent general rule was considered not justified as there may be valid reasons why exploitation occurs elsewhere (in which cases the EU often still benefits from such exploitation). Moreover, depending on the type of project the expected results are often not directly exploitable and would require systematically assessing all projects for long after the end of the project and not only those close to market. Finally, such a generalised approach would deter in particular industrial and international participation leading to a loss of excellence and a lower quality of results. |

9Dissemination and exploitation of results

9.1What is the current situation under Horizon 2020?

|  |
| --- |
| FACTS |
| Under Horizon 2020, a strategy for the dissemination and exploitation of R&I results was launched in 2015 at Framework Programme level, with dedicated dissemination and exploitation activities. The strategy was reviewed in 2017 and streamlined for the remaining years of Horizon 2020. At the same time, dissemination and exploitation activities were introduced from the various parts of the programme (i.e. the ERC Proof of Concept, the FET Launchpad, the SME Instrument) that support the uptake of results and innovations in the Union. |
| To assist project consortia in their dissemination and exploitation activities, the Commission provides tailor-made support services in the form of the Common Exploitation Booster (236 projects supported in 2017) and Common Dissemination Booster (260 projects supported in 2017) and the wide use of the Innovation Radar as a methodology to identify the innovations and innovators in R&I projects. |
| A new methodology tracking of research results obtained through the programme is under development. A new Horizon 2020 Dashboard making available all project related data and outputs was also set up. |

Throughout Horizon 2020, specific calls for proposals, coordination and support actions and public procurements provide targeted assistance to projects in order to increase their dissemination and exploitation capacity and activities.

The uptake of R&I results for policy making, as well as measuring the impacts of the Framework Programme’s investment, is improving under Horizon 2020. The Commission is piloting additional methodologies for tracking the research results (outputs, outcomes and impacts) after the completion of the projects. The aim of this is to acquire a more comprehensive view of what the research funded under the Framework Programmes has achieved.

For external stakeholders, CORDIS is the primary public repository and portal to disseminate information on all EU-funded R&I projects and their results; providing user-friendly access to project data and results through faster and broader visibility of projects' outputs and improved search functions. Specifically, project deliverables and project beneficiary information were disseminated for the first time in the history of Framework Programmes. 'Results Packs', a new dissemination function presenting thematic collections of exploitable research results, was developed along with 'Enhanced Results in Brief', a new function that provides additional support in dissemination of research results.

In 2017, the Commission has launched a new platform for advanced visualisation of data on the Framework Programme, the Horizon 2020 Dashboard, that provides a wide range of visualisation options for Horizon 2020 projects and proposals. It allows the users to visualise the performance and evolution of the data on the Framework Programmes in terms of impact, participation, investments, international cooperation, results, etc. The ‘Projects for Policy (P4P)’ initiative launched in 2017 clusters and uses R&I results for evidence-based policy recommendations. In addition, the Innovation Radar was introduced as a Horizon 2020-wide methodology to identify innovations and innovators within R&I projects.

|  |
| --- |
| Lessons learnt from Horizon 2020  Dissemination and exploitation activities are key to demonstrate the success and the impact of the Framework Programme. The dedicated activities to beneficiaries to better disseminate and exploit their results and increase their market and technology readiness were very successful and popular. Through the optimal use of IT infrastructure and the advanced visualisation of the available data on the Framework Programme (Horizon 2020 Dashboard), the Commission demonstrated the added value of the Programme.  Although a robust framework has already put in place to help dissemination and exploitation of R&I results from Framework Programme’s projects, they are still not fully accessible to all relevant stakeholders and this represents a barrier to knowledge circulation and to innovation uptake. Additional efforts required to access and make available knowledge and results from projects supported under the Programme.  Current information collection does not systematically cover research results, innovations and market uptake, and therefore does not always allow for the assessment of projects’ medium- and longterm impacts. New policy challenges should be better matching by the appropriate mechanisms to collect the necessary data.  The results of most Horizon 2020 R&I projects mainly improve scientific knowledge and advance science in the field(s) in question. Some will have market or technological potential. The uneven exploitation capacity among beneficiaries hinders the market uptake of key exploitable results and incentives for market exploitation are limited once funding has stopped.      Many R&I projects produce recommendations for policy-makers in various fields. As policy recommendations are less market- and technologically ready than other key exploitable results, projects do not tend to emphasise this kind of output. This hinders the full potential for exploitation of results from the Framework Programme for policy-making at EU and national levels.  (Sources: Horizon 2020 Interim Evaluation, Review of the Strategy for an Effective Dissemination and Exploitation of Research Results in Horizon 2020, studies) |

9.2What are the changes?

Within Horizon 2020, reporting has focused mainly on input information in relation to projects launched and funding granted. However, to address the significant need to report on the impact of research and innovation investments, equal attention will be given to information on results to develop a clear picture of the number of completed projects, the fields to which these relate, what they delivered and what steps have been taken regarding exploitation of research results.

The following changes are envisaged for the future Programme:

Short term:

ØSupport R&I stakeholders in fully endorsing the principle of the open access and work with them to make the European Open Science Cloud a reality;

ØPut in place a comprehensive go-to-market package to incentivise the exploitation of Framework Programme’s results by helping beneficiaries to find the most appropriate instruments and channels for the market uptake of their innovations;

ØPilot the role of Horizon 2020 as a pan-European policy influencer through Projects for Policy initiatives, with the aim of using scientific knowledge and results created by R&I projects;

ØDesign a methodology for monitoring the Framework Programme’s results and foster business intelligence that could build on artificial intelligence, advanced data visualisation and data mining tools to demonstrate impact.

Long term:

ØBased on the positive experience of the previous dissemination and exploitation strategy, put in place a more ambitious and comprehensive strategy for increasing the availability of R&I results and accelerating their uptake to boost the overall impact of the Framework Programme and thereby strengthen European innovation.

ØStrengthen innovation-friendly framework conditions that allow for unrestricted and constant knowledge circulation and create the necessary incentives for beneficiaries and innovators to share their results for reuse.

ØDisseminate clusters of mature research results to EU regions for potential uptake based on their specific needs. This would maximise the benefits coming from synergies with EU initiatives, for increasing regional competitiveness and innovation.

ØProvide holistic support throughout the dissemination and exploitation lifecycle to ensure a constant stream of innovations stemming from the Framework Programme.

9.3What are the expected implications of the changes?

ØNo major changes envisaged for Horizon Europe’s rules for participation. The obligation of beneficiaries towards dissemination, exploitation and impact demonstration shall be reinforced.

ØThe possibility of additional reporting specifically on dissemination and exploitation or impact demonstration might be considered within the framework of simplification. This reporting should continue beyond the lifetime of the projects.

9.4What alternatives have been considered?

·Additional incentives: beneficiaries could be given additional financial or other incentives to enhance their dissemination and exploitation capacity, focus on key exploitable results and their uptake, and/or enhance the impact of their research in realworld settings.

·More funding for ‘research on research’ would allow researchers to take the time to assess the quality and consistency of scientific results, gather research on a particular topic, identify common themes and develop common responses.

ØChanges in the evaluation phase: a different consideration of exploitation at evaluation phase, with an evaluation panel featuring clear business experience alongside academic and scientific background would help select proposals better placed for ensuring uptake of research results. For recurring participants in the Framework Programmes (i.e. having participated in previous programmes), consider introducing the requirement to submit, as part of their proposal, an ex-post Impact or Outcome Statement of their research conducted under previous Framework Programmes.

  

Annex 10: Implementation of the Strategy for international cooperation in R&I

The strategy for EU international cooperation in research and innovation (R&I) published in 2012
[213](#footnote214)
 supports the objectives of strengthening the EU’s R&I excellence, attractiveness and economic and industrial competitiveness, tackling global societal challenges, and supporting the EU’s external policies, including enlargement, neighbourhood, trade and development policies.

It makes a significant contribution to the implementation of the Commission priority on 'Europe as a stronger Global Actor' and is crucial for delivering on the 'Open to the World' priority of the EU's R&I policy.

These were as follows: 1) There is significant room for improvement of the international dimension of Horizon 2020, in particular through work programme (WP) topics of sufficient scale and scope that are specifically devoted to international cooperation; 2) The Commission shall remain proactive in ensuring good framework conditions for international cooperation, notably including extended co-funding mechanisms; 3) Further action shall be taken to widen participation and strengthen the EU's role in global multilateral fora; 4) Stronger synergies with the actions of Member States shall be sought including by means of structured policy coordination and opening of joint programmes to international participation; 5) Science diplomacy shall be used more extensively as an influential instrument of the EU's external policies; and 6) The communication strategy shall be refined to ensure global awareness of EU science and technology (S&T) strengths and its role in international R&I cooperation.

1Reinforcing the international dimension of the EU R&I Framework Programme

The international dimension of Horizon 2020 has been reinforced as part of priorities set for the last part of the programme covering commitments in 2018 to 2020.

Since the last progress report, Joint S&T Cooperation Committee meetings have been successfully organised with a range of countries
[214](#footnote215)
. In addition, Regional policy dialogues have notably included a Ministerial meeting with the Western Balkans, a Ministerial conference on strengthening Euro-Mediterranean cooperation in R&I, an Eastern Partnership summit, an EU-African Union high-level policy dialogue, and two EU-CELAC senior officials meetings. Multilateral work was also undertaken to ensure the coordination of the G7 Science Ministerial and Carnegie meetings.

Agreements at the S&T cooperation dialogues and high level policy dialogues have continued to serve as a basis for priority-setting in Horizon 2020 programming, continuous efforts have been undertaken to ensure that activities agreed effectively materialise, and multi-annual roadmaps for targeted international cooperation with twelve countries and six regions have been updated on a regular basis to reflect the latest status
[215](#footnote216)
.

Increased attention to and support of international participation in Horizon 2020 projects have been provided with the launch in October 2017 of the 2018-20 WP with more than 30 flagship initiatives of large scale and scope on topics dedicated to international cooperation in areas of mutual benefit, comprising a total budget of over 1€ billion.

Examples of large Flagship initiatives include the EU-Africa Partnership on Food & Nutrition Security & Sustainable Agriculture, the EU-China Food, Agriculture and Biotechnology flagship initiative, acceleration of energy innovation through the Mission Innovation initiative, large call on human data storage with Canada, multilateral cooperation on greener and safer aviation and road transport automation, climate action in support of the Paris Agreement, multilateral cooperation on 5G and on nanosafety, and international cooperation on migration challenges.

The latest statistics on participation of entities from non-associated international partner countries in Horizon 2020 grant agreements for collaborative actions
[216](#footnote217)
 show only a slight improvement as a result of actions in the 2016-17 WP: 24 % of WP topics are flagged for international cooperation, 2.5 % of all participations are from third countries, 0.9 % of EU contribution go to third-country participants, 12.0 % of all grant agreements include one or more partners from third countries, and €44 million per year is invested by third-country participants in Horizon 2020 projects. 2.3 % of all European Research Council (ERC) Principal Investigators have come to EU MS/AC from non-associated international partner countries; 17.3 % of all grantees of Marie Skłodowska-Curie Actions (MSCA) Individual Fellowships and almost 30 % of participations in MSCA Research and Innovation Staff Exchange come from third countries making it the most international scheme in Horizon 2020
[217](#footnote218)
.

For some types of action, partners from third countries are not part of the Horizon 2020 grant agreement, but sign separate (coordination) agreements. Notably, until end-2017, Horizon 2020 has launched 21 joint, coordinated and twinning calls with third countries that have led to projects with 220 European participations and a similar number of participations from non-associated third countries. Furthermore, participation of third country research programme funders in ERA-NET Cofund actions is at 5%, reflecting a similar share in the projects funded by these actions.

The Commission’s Joint Research Centre (JRC) has strengthened its collaboration with international partners. Close links with partners in Horizon 2020 Associated Countries have been consolidated, e.g. via technology-transfer support to the Western Balkan countries and new arrangements with the Research Council of Norway. The JRC has concluded new arrangements such as with the USA Department of Energy, the Chinese Academy of Sciences, and the Japanese Institute for Advanced Industrial Science and Technology, and extended partnerships such as with the USA National Oceanographic and Atmospheric Administration, the South African Space Agency, and the Brazilian Ministry of Science, Technology, Innovation and Communications. The JRC has also pursed its cooperation with multilateral organisations such as United Nations Organisation, World Bank and the Organisation for Economic Co-operation and Development (OECD).Engaging internationally has positive effects. Horizon 2020 data shows that the success rate of proposals increases when the consortium takes on board international partners and international co-publications are on average more often cited than other publications.

The significant number and size of international cooperation flagship initiatives launched for the last part of Horizon 2020 are expected to result in a step-change improvement in international involvement, be it through participation in Horizon 2020 projects, through coordinated calls, or through contributions to global multilateral initiatives.

The Commission has also continued to monitor and assess the implementation of Horizon 2020 Association Agreements and to examine measures to improve and develop cooperation. This has been done through Joint Committee meetings as well as through policy support to assist with reform agendas.

Assessments have been carried out for the Associated Countries for which the review clause was applicable. These assessments looked at Horizon 2020 budget absorbed versus contributions made to the EU budget, as well as progress towards the ERA priorities, number of researchers in the country, participation in Horizon 2020 proposals and projects, and success rate of these proposals. In case of a large degree of underperformance, the assessments also analysed the root causes of this and suggested remedies.

For the next Framework Programme, the Commission proposes to extend openness for association, beyond EU enlargement, EEA countries and ENP countries, to include all countries with proven science, technology and innovation capacities to make cooperation and funding of joint projects as smooth as possible. It is also proposed to intensify support to international large-scale flagship initiatives, partnerships, bilateral and multilateral initiatives and joint programmes and calls, so as to increase access to researchers, knowledge and resources worldwide and optimise benefits from cooperation. The programme should continue to fund entities from low-mid income countries, and to fund entities from industrialised and emerging economies only if they possess essential competences or facilities.

2Improving the framework conditions for engaging in international cooperation

The Commission has remained proactive in creating a level playing field for researchers from across the world to cooperate smoothly with each other.

Notably, the Commission has continued to encourage and assist industrialised and emerging economies in increasing the scope and improving the functioning of mechanisms for funding the participation of their researchers in Horizon 2020.

For instance, at the 3rd EU-China Innovation Cooperation Dialogue in June 2017 agreement was reached to renew and extend the co-funding mechanism for the Chinese government to support entities from China in Horizon 2020 projects for the period 2018-20. In India, the Ministry of Earth Science has set up its own co-funding mechanism, following the path of the Ministry of Science and Technology.

Many S&T Cooperation dialogues have also discussed reciprocal access to science, technology and innovation (STI) resources, supported by monitoring, data collection and analysis. Concrete outcomes include, for example, a new Guide for EU stakeholders on Chinese national STI funding programmes that was published in January 2018.

Other bilateral and regional S&T cooperation dialogues have also tackled priorities for improvements in framework conditions. For example, in September 2017 a ministerial meeting of the Western Balkans Platform on R&I discussed how to increase national R&I capacities and progress towards integration into the European Research Area; and the two EU-CELAC senior officials meetings in 2017 resulted in a policy advice initiative for CELAC countries, a bi-regional initiative to strengthen the management of and access to research infrastructures, a bi-regional call on cancer research, and an extension of the EURAXESS initiative to all CELAC countries.

New structures supporting European research, innovation and business organisations to establish connections and a foothold in third country markets have been established. Early 2017 grants were awarded to launch the first nodes of a Network of European R&I Centres and Hubs in the USA, China and Brazil.

Smooth mobility of researchers is another important framework condition. In addition to activities under MSCA, the Commission has supported ERC Implementing Arrangements that have now been signed with funding bodies in ten countries around the world: USA, South Korea, Argentina, Japan, China, South Africa, Mexico, Brazil, Canada, and India.

The multi-annual roadmaps for targeted international cooperation contain more detailed information on framework conditions in place for each country/region and the priorities for future improvements.

3Leading multilateral initiatives - working with international organisations on global challenges

Action has been taken to strengthen the EU's role in global multilateral initiatives and to leverage investments in solutions to global challenges of high priority for the EU.

In February 2017, the Commission took over the chairmanship of the Steering Committee of the Mission Innovation initiative on clean energy research. It is leading two Innovation Challenges and is actively engaged in the five remaining ones. The initiative is also growing in terms of its membership, in particular from the EU Member States. Calls for proposals designed for Mission Innovation-related activities have been introduced in the 2018-2020 WP of Horizon 2020 for a total amount of nearly €150 million.

In addition, as part of the efforts towards structuring marine research cooperation, a new South Atlantic R&I Flagship Initiative was signed in July 2017 to improve the scientific knowledge of marine ecosystems and the links between oceans and climate change, food and energy systems, as well as the dynamics of the Atlantic Ocean and its interconnected circulation systems from Antarctica to the Arctic. The All Atlantic Ocean Research Alliance Flagship and the Future of Seas and Oceans Flagship have been allocated more than €80 million in the 2018-2020 WP of Horizon 2020.

Global health issues have remained top of the agenda. Multi-lateral initiatives such as the International Rare Diseases Research Consortium, the International Human Epigenome Consortium and the Global Alliance for Chronic Diseases, have continued their active role with calls published under SC1. The Coalition of Epidemic Preparedness Innovation, CEPI, was launched in January 2017. At the end of 2016, through the Global Research Collaboration for Infectious Diseases Preparedness, the EU mobilised substantial political, financial and scientific resources to help the people affected by the Zika virus and to contain, control, treat and ultimately defeat it. The 2018-2020 WP of Horizon 2020 contains topics with a combined budget of more than €250 million that will go to projects contributing to global health multilateral initiatives. The EC has continued with the contribution to the Human Frontier Science Programme, an international funding organisation for multi-disciplinary life science frontier research of 15 countries over four continents.

As climate change and the environment are global issues, EU action has continued to be coordinated with international and multilateral processes such as the Group on Earth Observation (GEO) and the Belmont Forum. Active EU involvement in these platforms has contributed to setting global agendas to implement jointly, and their feedback has been used to inform strategic programming at EU level. For example, the 2016-17 WP of Horizon 2020 included three Belmont Forum topics: sustainable urbanisation, transformations to sustainability, and biodiversity scenarios.

Moreover, the Commission has continued to play an important role in intergovernmental bodies such as the International Panel on Climate Change (IPCC) and the Intergovernmental Platform on Biodiversity and Ecosystem Services (IPBES). EU projects have contributed substantially to stocktaking and knowledge generation: for example, EU action plays a key role in the development and aggregation of climate change models in coordination with the IPCC.

The Commission also continued its active role in international bodies such as the OECD and the G7/G20. For example, the joint Commission-OECD survey on STI policies, the Commission participation in a range of thematic working parties of the OECD, and the contribution of several Commissioners in the G7 Innovation Week in Italy in September 2017.

4Reinforcing the partnership with Member States

Synergies with Member States' actions have been strengthened notably by involving third countries in joint programmes.

In particular, the Partnership for Research and Innovation in the Mediterranean Area, PRIMA, was launched in early 2018, following adoption of the PRIMA Basic Act by the co-legislators and putting in place international agreements regulating the participation of third countries that are not associated to Horizon 2020. Work is now underway to devise new R&I approaches to improve water availability and sustainable agriculture production in a region heavily distressed by climate change, urbanisation and population growth. The partnership will be financed through a combination of funding from participating countries (currently €274 million), and a €220 million contribution from the EU through Horizon 2020.

The second European and Developing Countries Clinical Trials Partnership Programme, EDCTP2, supported by nearly €700 million in EU funds, has so far launched 31 calls for proposals resulting in 125 grants worth € 264 million to accelerate the clinical development of medical interventions for poverty-related diseases in Sub-Saharan countries. In addition, projects granted € 157 million from calls in 2017 are about to start.

The EC supported Member States led initiative International Consortium for Personalised Medicine, ICPerMed, set up in 2016, which includes several non-EU partners among the current 40 members. Canada is already on board and discussions are ongoing to include institutions from Brazil, South Africa and other countries. In an effort to join forces on the fight to anti-microbial resistance, the Joint Programming Initiative on Anti-Microbial Resistance has opened up to Third countries: Argentina, Canada, Egypt, India, Japan, South Africa and South Korea have recently joined it.

The international dimension of ERA-NET Cofund actions, supporting public-public partnerships in their implementation of joint activities and topping-up of a trans-national call for proposals, has also increased. Nearly half involve third countries as full partners, and more than two-thirds include activities dedicated to establishing partnerships with third countries, e.g. through additional joint calls or through global multilateral initiatives.

The Strategic Forum for International Scientific and Technological Cooperation, SFIC, has continued its work to further develop, implement and monitor the international dimension of the ERA. In particular, in 2017, the Forum issued opinions on international cooperation in the context of the mid-term review of Horizon 2020 and the preparation of the 9th EU Framework Programme for R&I, as well as on gender aspects in international R&I cooperation.

Part of the strategic advice from SFIC also includes reports on instruments for the implementation of international S&T cooperation agreements and other international S&T cooperation activities at EU and national level. Furthermore, the Forum has continued contributing to the implementation of the ERA Roadmap, fostered peer-learning activities, and carried on work on geographic initiatives such as for China and for Brazil.

5Intensifying the synergies with the EU's external policies

The Joint S&T Cooperation Committee meetings and Regional Policy Dialogues have been instrumental for R&I to feature prominently in several Summit discussions and conclusions, including, inter alia, those with the Eastern Partnership countries, with India and with the African Union. This is also a result of continuously close interactions between the Commission and the European External Action Service.

Further integration of the Western Balkans into existing EU knowledge networks and support for R&I capacity building for an effective participation in the EU's Framework Programmes are part of the Action Plan in support of the transformation of the Western Balkans issued in February 2018. Centres of Excellences set up with Horizon 2020 support are attracting researchers, contributing to combating brain drain in the region, and they have a direct economic impact, triggering growth through innovation, enabling joint R&I activities across borders and contributing to building trust, reconciliation and stability in the region.

The strategy has also stayed closely coordinated with EU neighbourhood policies. For instance, the EU4Innovation initiative was presented as a key deliverable of the 5th EaP Summit in November 2017. The initiative combines all EU activities that support the development of Eastern Partnership countries' innovation capacities, notably those funded under Horizon 2020 and the European Neighbourhood Instrument, bringing new mobility opportunities and fostering research-industry partnerships amongst others.

Science diplomacy action has continued as an important part of the strategy. For example, in May 2017 the SESAME synchrotron, the first major international research infrastructure in the Middle East, started operating in Jordan. With financial support to its construction, the EU has been a major contributor to SESAME, which also contributes to foster a culture of peace and cooperation through science in the region. Other examples include R&I activities with Iran in the context of the EU-Iran Renewed Partnership. Horizon 2020 has extended its support to projects analysing cases and instruments of science diplomacy and devising tools and processes for science diplomacy as part of EU external action.

Cooperation with development policies has continued. For instance, in October 2017 the 4th EU-African Union High level Policy Dialogue on Science, Technology and Innovation took stock of results of the partnership on Food, Nutrition Security and Sustainable Agriculture integrating capacity building and innovation processes and adopted the roadmap towards a new partnership focused on climate services, renewable energy and energy efficiency.

Finally, EU international S&T cooperation has been used to enhance the EU's influence on common positions within international fora that are defining global targets and regulations in various thematic fields. For example, EU-supported research has often provided the foundation for international maritime safety rules for global shipping which are applied via the International Maritime Organisation.

6Refining the communication strategy

The Commission has continued to refine its communication strategy and strengthen its monitoring of the strategy.

In particular, the Service Facility in support of international R&I cooperation policy development, priority-setting and implementation started operating early 2017 and is now providing services for awareness raising and training, support to National Contact Points, organisation of R&I events, set-up of R&I, business and policy partnering platforms, and thematic and geographical analysis and monitoring activities.

In addition, the Commission, in close cooperation with the EU Delegations, have continued promoting Horizon 2020, raising the profile of the EU as an excellent destination for R&I and promoting the 'Open to the World' policy priority. Special emphasis has been put on the use of multipliers and on taking advantage of existing events.

Monitoring of the implementation of the strategy in Horizon 2020 has been upgraded through the 'International Cooperation' dedicated view of the Horizon 2020 Dashboard, providing real-time values of the international cooperation indicators and more.

7Conclusions

The dominance of international collaborative research in knowledge production and the emergence of new countries as major R&I players are accelerating. This calls for further strengthening of action to ensure that the EU has access to, and benefits from, the world’s best talents, expertise and resources.

Moreover, EU international cooperation in R&I policy should contribute to the EU's economic policy objectives, enhancing EU's external competitiveness, creating a level playing field and opening up new markets for European companies via innovative solutions, making use of economic diplomacy tools where appropriate. Synergies with EU external policies should also contribute to the EU's development policy objectives, help build R&I capacity, and support diffusion and uptake of innovation.

The increasing scope and interconnectivity of global societal challenges require more international joint action and coordination of agendas. Instruments for EU support to global multilateral initiatives should be improved, and partners from the rest of the world should increasingly be invited to join EU efforts as an integral part of initiatives in support of EU action for sustainable development.

In the further implementation of the strategy, priority should be given to activities that facilitate the collaboration of European researchers with their counterparts worldwide, enable international mobility of researchers and ensure access to research infrastructures globally, so as to ensure reinforced EU R&I excellence and the creation and diffusion of high-quality knowledge in the EU.

International openness of the innovation eco-systems promotes a level playing field, opens markets for European companies and enhances supply and demand of innovative solutions. Further activities under the strategy should extend support to joint and coordinated funding of global industrial research and innovation cooperation, so as to strengthen EU economic and industrial competitiveness.

Using the EU R&I Framework Programme as a key vehicle for cooperation, activities under the strategy should continue to promote and integrate cooperation with international partner countries based on mutual benefit. Priorities should be identified based on thematic and geographical strategic intelligence and foresight of S&T capabilities, market opportunities and impact on EU competitiveness, contribution to international commitments, and framework conditions for cooperation.

In short, openness to the world remains a strategic priority for EU R&I policy as it reinforces R&I excellence, strengthens competitiveness, and helps solve global societal challenges in support of EU external action. Hence, the objectives of the strategy stay pertinent and further activities are needed to ensure that the EU benefits from latest developments.

  

Annex 11: Simplification checklist

This checklist is added to this impact assessment to highlight the Commission efforts in simplifying rules and procedures, based on lessons learnt under the current financial framework. It will contribute to the Simplification Scoreboard, to be added to the new MFF package.

|  |  |
| --- | --- |
| Item | Checks |
| 1.Scope for using Simplified Cost Options, payments based on output / against conditions |  Can the use of these options be extended to new areas?    Yes;  Horizon Europe will offer the complete set of forms of grants set out in the Financial Regulation to beneficiaries and indicate the choice of the most appropriate ones in the Work Programme. Although, actual incurred costs will remain the main form of costs under the Framework Programme, the use of simplified forms of costs could be extended to other areas than currently under Horizon 2020.     Which ones?    In order to lower administrative burden, increased use will be made of lump-sum project funding against fulfilment of activities - building on the experience from the lump-sum pilot in Horizon 2020 - and other simplified forms of funding provided by the new Financial Regulation.     Which simplified option is the most appropriate?    Simplified form of costs will be used in a flexible manner across the next Framework Programme depending on the needs and specificities of the policy objectives:  ‒indirect  costs will be reimbursed via a flat-rate calculated on the direct eligible costs;  ‒unit costs calculated in accordance with the beneficiary usual cost accounting practices will be kept (i.e. average personnel costs and costs of internally invoiced goods and services); MSCA will continue to be entirely financed by unit cost;  ‒Lump sum will continue to be used for small-scale actions. Building on the Lump Sum pilot carried out for collaborative project under Horizon 2020, increased use will be made of lump-sum project funding against fulfilment of activities in the next Framework Programme.  ‒Financing not linked to costs (set out under Article 125.1 (a) of the Financial Regulation) could be envisaged in order to give financial incentives to grant beneficiaries to implement specific objectives (e.g. to implement gender equality plans).     Why?    Experience has shown that simplified forms of costs have proven to be viable an appropriate for the R&I programme, in particular lump sum. |
| 2.Budget Focussed On Results |  Is there a mechanism to ensure delivery of results?   Are indicators defined?   Are they quantitatively and qualitatively appropriate?    There are several mechanisms to ensure delivery of results, from strategic planning to support for dissemination and exploitation; moreover, the programme's performance towards its general objectives will be closely monitored along key impact pathways. Appropriate baselines and targets for the pathway indicators will be set; implementation data will be publicly available in close to real-time. |
| 3.Additional externalisation to executive agencies, JU, PPP, decentralised agencies |  Is room for externalisation fully exploited?  Yes.  Following the positive results of the last 3 years evaluations of R&I executive agencies, the intention is to further delegate to executive agencies, provided that the results of the mandatory cost-benefit analysis are positive.  Partnerships will be an important part of the next R&I Framework Programme. Mandatory impact assessments will be required for partnerships established under Art. 185 and 187.     Is the financing of the agency(-ies) foreseen?    Yes, the financing of Executive Agencies is foreseen. |
| 4.Synergies |  How are synergies between various tools, instruments, programmes ensured?    The Commission will now capitalise on the experience gained in jointly implementing the current generation of funding programmes and will focus on enhancing synergies with other EU Programmes from the programme design stage to ensure that the range of EU instruments and programmes covers the whole innovation cycle, in particular, by:  -Bringing priorities more in line with each other;  -Making co-funding schemes more flexible in order to pool resources at EU level; and  -Improving compatibility of rules, for example, making it possible to apply the Seal of Excellence. |
| 5.Flexibility: in programming, between management modes |  Are all the possible flexibility margins and tools exploited in designing the programme?    Horizon Europe is designed to allow the maximum of flexibility, while ensuring coherence across the board. It is intended to externalise all implementation to executive agencies. Recourse to joint undertakings and other structures to implement partnerships will be the subject of a strategic planning process, and will not form part of the legislation. |
| 6.Non-allocated envelopes |  Is a non-allocated envelope appropriate/foreseen?    No. Considering the high oversubscription and that any urgent research needs should be covered by the next R&I Framework Programme, a non-allocated envelope is not appropriate. |
| 7.Budget-support, SRSS |  Is recourse to budget support/structural reform support justified/appropriate?    Not applicable to Horizon Europe. |
| 8.Fraud proof |  Are proper mechanisms set to ensure fraud prevention?   Are audit/anti-fraud provision clear?    The R&I family has a common anti-fraud strategy for grants. This will be updated after the adoption of the new Commission Anti-Fraud Strategy in 2018. DG RTD is also developing its own anti-fraud strategy for non-grant expenditure, especially Financial Instruments, and is working with OLAF on this question.    The anti-fraud strategy has been audited by the Internal Audit Service and appropriate action plans put in place to address any recommendations.    Audit and anti-fraud provisions are (or will be) included as necessary in the base legislation, the Rules for Participation and the Model Grant Agreement, all based as far as possible on the standard rules of the Financial Regulation. |
| 9.Single rule book |  Is there any strong reason to deviate from the Financial Regulation/basic act template?  The new Financial Regulation is used as a common reference for the Horizon Europe rules for participations. Compared to Horizon 2020, the rules are further aligned to the Financial Regulation and the derogations kept to a necessary minimum, justified by the specificities of the R&I ecosystem and built on the experience from past framework programmes. The main derogations concern: time to grant, treatment of in-kind contributions, financial capacity check, appointment of external experts. As an example, the system of in-kind contributions provided by third parties to the beneficiaries is further aligned to the Financial Regulation (i.e. for in-kind contributions against payment), while the specificities of the research are preserved (i.e. for in-kind contributions free-of-charge).     Can the need be addressed by any other means than derogation?  For each limited derogation, several alternatives have been considered including alignment to the Financial Regulation. However, this alignment would imply significant changes for beneficiaries, which will neither reduce the administrative burden nor enhance the simplification of the rules. In addition, it may reduce the attractiveness of the programme and therefore negatively affect its results. |
| 10.Single portal | Has a single portal (e-access) for beneficiaries of the policy area been foreseen, independently from the delivery tool (Financial Instruments, grants, etc.)?    Yes. As is already the case for Horizon 2020, the Horizon Europe will be managed fully electronically by a single portal. The portal will cover all actions implemented by grants, prizes and procurement, and will provide links to the instances for managing Financial Instruments. |
| 11.Multi-annual programme |  Is the work programme multiannual?   If not, what is the advantage of annual programming?   Does the advantage of annual programming outweigh multi-annual programming?    The work programmes under Horizon Europe are expected to follow the pattern of Horizon 2020, spanning a period of at least two years, with the possibility to be updated within this period in case of unforeseen needs or other special circumstances.  In the specific case of the European Research Council, the work programme will be adopted on an annual basis, as the Scientific Council, which is responsible for the preparation of the work programme, needs to deliberate in the light of the experience of the previous calls. |
| 12.Error rate/high control costs |  Have high error rate/high control controls from the previous programme been addressed under this programme?   How?   Is that adequate?    First audit results for Horizon 2020 suggest that the error rates will be lower than those from FP7:  ·FP7 - 5% on a representative basis and 3% residual error rate  ·Horizon 2020 – 3% on a representative basis and 2.5% on a residual basis, but if all things remain equal the residual error rate will fall over time.    Further simplification of rules in Horizon Europe, and especially a wider use of Simplified Cost Options, will allow for a further fall in the error rate. However, in a system based on the reimbursement of eligible costs, it is uncertain whether the error rates can be brought below 2%.    One way to sharply reduce the error rate would be the wider use of lump sum funding, which is already used in Horizon 2020 for the SME programme stage 1 programme. The legislation allows for this. The work programme 2018 includes pilots of lump sum funding in some cooperation grants. In the next Framework Programme, an increased use will be made of lump-sum project funding against fulfilment of activities – building on the experience from the lump-sum pilot in Horizon 2020    The emphasis foreseen in Horizon Europe on cross reliance on audits & assessments between EU programmes (e.g. with ERDF and CF) is expected to reduce the audit burden on beneficiaries, thus the cost of control for the Commission. |
| 13.Re-conduction of previous basic act |  Is it necessary to propose an entirely new basic act, or could it be sufficient to propose an amendment of an existing act?    A new basic act is required because of the scope of changes between Horizon 2020 and Horizon Europe for simplification and rationalisation. Moreover, the legal texts of the Framework Programme and of the Rules for Participation (currently separate) will be merged into a single text. |

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:   [(44)](#footnoteref45)

    High Level Group Own Resources report, 
    <http://ec.europa.eu/budget/mff/hlgor/library/reports-communication/hlgor-report_20170104.pdf>
:   [(45)](#footnoteref46)

    Elsevier, based on Field Weighted Citation Index.
:   [(46)](#footnoteref47)

    The European Research Council is recognised as a global brand synonymous with research excellence, with substantial structuring effects in the Member States. Four ERC grantees have been awarded the Fields Medal after being funded by the ERC. The ERC, MSCA and FET, together with collaborative research themes, have supported at least 17 Nobel Prize winners prior or after the award of their prize and Horizon 2020 beneficiaries have also contributed to major scientific discoveries including the Higgs Boson at CERN, the detection of gravitational waves and the discovery of a planetary system composed of seven Earth-like worlds (exo-planets) located relatively close to Earth in 2017.
:   [(47)](#footnoteref48)

    Study on assessing the contribution of the Framework Programmes to the development of human research capacity: 
    <http://ec.europa.eu/research/evaluations/pdf/archive/other_reports_studies_and_documents/fp_hrc_study_final_report.pdf>
:   [(48)](#footnoteref49)

    PPMI study (2017), Assessment of the Union Added Value and the Economic Impact of the EU Framework Programmes (FP7, Horizon 2020).
:   [(49)](#footnoteref50)

    http://www.oecd.org/sti/Science-brief-scoreboard.pdf, “Outflows tend to be associated with higher rated publications than their staying or returning counterparts. Assuming one could raise the performance of “stayers” to the level of their internationally mobile researchers […] this would help countries catch up with leading research nations.”
:   [(50)](#footnoteref51)

    PPMI study (2017), Assessment of the Union Added Value and the Economic Impact of the EU Framework Programmes (FP7, Horizon 2020). Based on survey data.
:   [(51)](#footnoteref52)

    Elsevier based on Field Weighted Citation Index.
:   [(52)](#footnoteref53)

    Average growth rate of 24.4% in EU funded teams compared with 12.6% in the control group.
:   [(53)](#footnoteref54)

    PPMI study (2017), Assessment of the Union Added Value and the Economic Impact of the EU Framework Programmes (FP7, Horizon 2020). Based on survey data.
:   [(54)](#footnoteref55)

    Several of these projects have allowed collaboration with policy makers, such as the European Medicines Agency and their results have had an effect on antibiotic stewardship policies and infection control policies
:   [(55)](#footnoteref56)

    Beneficiary teams increased their R&D budgets by 22.4%. The corresponding value for the non-FP teams was -2.2%. PPMI study (2017), Assessment of the Union Added Value and the Economic Impact of the EU Framework Programmes (FP7, Horizon 2020). Based on survey data.
:   [(56)](#footnoteref57)

    Data provided by the Thematic Units responsible for the seven Joint Undertakings.
:   [(57)](#footnoteref58)

    Annual monitoring reports of Factories of the Future, SPIRE and Energy-efficient Buildings.
:   [(58)](#footnoteref59)

    PPMI study (2017), Assessment of the Union Added Value and the Economic Impact of the EU Framework Programmes (FP7, Horizon 2020). Based on survey data.
:   [(59)](#footnoteref60)

    Di Comite F. and Kancs D., Macro-Economic Models for R&D and Innovation Policies (2015), IPTS Working Papers on Corporate R&D and Innovation – No 03/2015.
:   [(60)](#footnoteref61)

    Seureco (2018), Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme.
:   [(61)](#footnoteref62)

    Ibidem.
:   [(62)](#footnoteref63)

    Lab. ERASME / Ecole Centrale Paris (now SEURECO), Federal Planning Bureau of Belgium, E3M3 lab. / ICCS /NTUA and Chambre d’Industrie et de Commerce de Paris.
:   [(63)](#footnoteref64)

    Brécard, D., Fougeyrollas, A., Le Mouël, P., Lemiale, L. and P. Zagamé (2006), “Macro-economic consequences of European Research Policy: Prospects of the NEMESIS model in the year 2030”, Research Policy n°35(7), pp. 910-924. Doi: 10.1016/j.respol.2006.03.001.
:   [(64)](#footnoteref65)

    Chevallier, C., Fougeyrollas, A., Le Mouël, P., and P. Zagamé (2006), “A time to sow, a time to reap for the European Countries: A macro-econometric glance at the RTD National Action Plans”, Revue de l’OFCE, 2006/5 (n°97 bis), pp. 235-257. Doi: 10.3917/reof.073.0235
:   [(65)](#footnoteref66)

    Delanghe, H. and U. Muldur (2007), “Ex-ante impact assessment of research programmes: The experience of the European Union's 7th Framework Programme”, Science and Public Policy, n°34(3), pp. 169-183, doi: 10.3152/030234207X218125.
:   [(66)](#footnoteref67)

    European Commission (2012), “The Grand Challenge – The design and societal impact of Horizon 2020”, Directorate-General for Research and Innovation. Doi: 10.2777/85874.
:   [(67)](#footnoteref68)

    PPMI (2017), “Assessment of the Union Added Value and the Economic Impact of the EU Framework Programmes (FP7, Horizon 2020)”, 2017. https://frama.link/o6oBPRZU.
:   [(68)](#footnoteref69)

    The obsolescence of the innovation comes from the depreciation rate used in the knowledge stock formulation. These depreciation rates are of 15% for R&D, 35% for ICT and 36% for the Other Intangibles.
:   [(69)](#footnoteref70)

    Amount of additional R&I expenditures leveraged by the initial R&I investment.
:   [(70)](#footnoteref71)

    PPMI (2017), Assessment of the Union Added Value and the Economic Impact of the EU Framework Programmes (FP7, Horizon 2020), Final report, European Commission report.
:   [(71)](#footnoteref72)

    Seureco (2018), Support for assessment of socio-economic and environmental impacts (SEEI) of European R&I programme.
:   [(72)](#footnoteref73)

    Ibidem.
:   [(73)](#footnoteref74)

    Ibidem.
:   [(74)](#footnoteref75)

    Ibidem.
:   [(75)](#footnoteref76)

    Figures in constant prices. This corresponds to about EUR 720bn over 25 years, and EUR 550bn over 20 years.
:   [(76)](#footnoteref77)

    See Ratto, M., Roeger, W., & in't Veld, J. (2009). QUEST III: An estimated open-economy DSGE model of the euro area with fiscal and monetary policy. Economic Modelling, 26(1), 222-233.
:   [(77)](#footnoteref78)

    See Varga, J., Roeger W. and in 't Veld, J. (2014), “Growth effects of structural reforms in Southern Europe: the case of Greece, Italy, Spain and Portugal” Empirica, vol. 41, issue 2, 323-363., Varga, J. and in 't Veld, J. (2011). “A model-based analysis of the impact of Cohesion Policy expenditure 2000-06: Simulations with the QUEST III endogenous R&D model.” Economic Modelling, 28 (1-2), 647-663. and 
    <https://ec.europa.eu/info/business-economy-euro/economic-and-fiscal-policy-coordination/economic-research/macroeconomic-models_en>
     for other publications using the QUEST model.
:   [(78)](#footnoteref79)

    The micro-founded general equilibrium approach is also the basis for other macroeconomic models developed by the Commission such as the QUEST model developed by the Directorate-General for Economic and Financial Affairs (DG ECFIN).
:   [(79)](#footnoteref80)

    Kancs, D. and Siliverstovs, B. (2016), R&D and non-linear productivity growth, Research Policy, 45, 634-646.
:   [(80)](#footnoteref81)

    Christensen, M., Assessing the regional socio-economic impact of the European R&I programme, forthcoming.
:   [(81)](#footnoteref82)

    Di Comite F. and Kancs D. (2015), Macro-Economic Models for R&D and Innovation Policies, IPTS Working

    Papers on Corporate R&D and Innovation – No 03/2015.
:   [(82)](#footnoteref83)

    Indicators on publications are collected under Horizon 2020, for instance the number of peer reviewed publications and top 1% or 10% citations but with different coverage across programme parts.
:   [(83)](#footnoteref84)

    The indicators will be tracked also for co-authored publications across types of organisations, disciplines, sectors, countries (including associated and third countries).
:   [(84)](#footnoteref85)

     Data on individual researchers and innovators is collected only under some programme parts under Horizon 2020 (ERC, MSCA). It is proposed to extend the coverage to the whole Programme and to look at the overall effects of the FP on individuals based on the collection of unique identifiers for each beneficiary at project’s start. This shall allow for a more solid and automated analysis of the contribution of the Programme to the strengthening of human capital without further data requests to beneficiaries.
:   [(85)](#footnoteref86)

    By type of activities: training, mentoring/coaching, mobility, access to infrastructures
:   [(86)](#footnoteref87)

    Two indicators were specified as a cross-cutting issue under Horizon 2020 for open access publications and open access to data.
:   [(87)](#footnoteref88)

    Missions are a new element under the Framework Programme, which did not exist under Horizon 2020 and will be not be specified at the stage of the legal proposal. The interim evaluation of Horizon 2020 pinpointed to the lack of data to track the societal impact of the Programme beyond publications and patents in fields related to societal challenges. It is proposed to assess the progress towards the achievement of the targets set in each mission.
:   [(88)](#footnoteref89)

    Data on responsible research and innovation was collected under Horizon 2020 at the level of the activities within projects. It is proposed to go beyond this indicator to assess the effects of the co-creation on the development of citizen engagement mechanisms in beneficiary entities (such as citizen fora, participatory research, co-creation facilities, etc.) to then assess the extent this affects the uptake and outreach of the scientific results (e.g. changing behaviours) and innovative solutions from the programme.
:   [(89)](#footnoteref90)

    An innovation is a new or improved product or practice (policy, process or procedure) of an institutional unit, or a combination thereof, that differs significantly from the unit’s previous products and practices and has been brought into practical use by the unit or made available to others.
:   [(90)](#footnoteref91)

    Horizon 2020 includes an indicator on the growth and job creation in participating SMEs but no data is collected. It is proposed to extent this indicator to the whole programme and to collect information on the types of jobs created or maintained based on the collection of unique identifiers of companies. This shall allow for a more solid and automated analysis of the contribution of the Programme to the creation of more and better jobs without further data requests to beneficiaries.
:   [(91)](#footnoteref92)

    Types of innovation: by level of novelty of the innovation (e.g. based on the Oslo Manual definition), by objective of the innovation (incl. social innovation) and by source of innovation (i.e. technological (Key Enabling Technologies, other) /non-technological)
:   [(92)](#footnoteref93)

    Patents, trademarks, standards. The indicators will be tracked also for co-authored IPR across types of organisations, disciplines, sectors, countries (including associated and third countries).
:   [(93)](#footnoteref94)

    Data on innovative products, process or methods developed in FP projects is collected under Horizon 2020 but the effects on company creation, growth and market shares are not monitored.
:   [(94)](#footnoteref95)

    Types of jobs: by level of qualification (low, medium, high (based on ISCED 1997 levels) and contract duration (short, long term).
:   [(95)](#footnoteref96)

    Direct jobs: jobs within beneficiaries entities. Indirect jobs: Jobs in non-FP beneficiary entities (e.g. suppliers).
:   [(96)](#footnoteref97)

    Public and private funding leveraged under Horizon 2020 is computed on different ways depending on the types of action. It is proposed to use an overall indicator of the direct and indirect public and private investment leveraged including venture investment, loans and other co-financing, to be able to assess the overall contribution of the Programme to the achievement of the 3% target for R&D investments.
:   [(97)](#footnoteref98)

    Including venture investment, loans and other co-financing.
:   [(98)](#footnoteref99)

    e.g. Research performer; Technology development; Testing / validation; Demonstration (proof of viability); Scale-up; Private buyer of solutions to be developed; Public procurer of innovative solutions; Finance provider; Provision of the technology basis; Provision of the technology infrastructure; Representative of civil society interests/needs; Co-definition of a research / market need; Training, dissemination activities).
:   [(99)](#footnoteref100)

    In-Depth Staff Working Document on Horizon 2020 Interim Evaluation, SWD(2017) 221 final, p.171.
:   [(100)](#footnoteref101)

    'LAB-FAB-APP: Investing in the European future we want' - Report of the High Level Group on Maximising the Impact of EU R&I Programmes, July 2017, p26.
:   [(101)](#footnoteref102)

    Synergies between Framework Programmes for Research and Innovation and European Structural and Investment Funds – Contributing to the Interim Evaluation of Horizon 2020, September 2017, p6.
:   [(102)](#footnoteref103)

    European Parliament Report on the assessment of Horizon 2020 implementation in view of its interim evaluation and the Framework Programme 9 proposal June 2017, p.15.
:   [(103)](#footnoteref104)

    Council Conclusions "From the Interim Evaluation of Horizon 2020 towards the Ninth Framework Programme", December 2017, p.11.
:   [(104)](#footnoteref105)

    European Strategic Forum on Research Infrastructures.
:   [(105)](#footnoteref106)

    For example through a dedicated budget under CAP, programmed to be implemented under the Framework Programme
:   [(106)](#footnoteref107)

    With specific regard to vulnerable groups including refugees micro-enterprises and young adults.
:   [(107)](#footnoteref108)

    See p.43-44 of the Connecting Europe Facility Mid-Term Evaluation Staff Working Document (SWD 2018 44 final) for details on the coherence and complementarity with Horizon 2020. For example: "With its deep research and development shape, Horizon 2020 can be seen as an instrument for providing financial support to studies, assessments and preliminary tests and pilot projects, which can be then tested and deployed in the framework of CEF".
:   [(108)](#footnoteref109)

    Notably including the EDF, DCI; ENI; PI; EIDHR; IcSP; INSC and the CIR. Financial instrument include the European Fund for Sustainable Development (EFSD) and the European Investment Bank’s (EIB) external lending mandate (ELM)
:   [(109)](#footnoteref110)

    See 
    <https://sustainabledevelopment.un.org/post2015/transformingourworld>
:   [(110)](#footnoteref111)

    See 
    <http://unfccc.int/paris_agreement/items/9485.php>
:   [(111)](#footnoteref112)

    See 
    <https://www.africa-eu-partnership.org/en>
:   [(112)](#footnoteref113)

    The Issue Paper on 'Widening Participation' states: "An important example of synergies between ESIF and Horizon 2020 is the ELI - Extreme Light Infrastructure (distributed) project, located in Czech Republic, Hungary and Romania, that is supported by these countries under their ESIF resources complementing the European Strategy Forum on Research Infrastructures (ESFRI)". Many examples of ESIF-R&I Framework synergies are also profiled in the "EU Funds Working Together for Jobs and Growth" publication listed above, while practical ways to improve Horizon 2020-ESIF synergies are outlined in the "Contributing to the Interim Evaluation Final Report" publication listed above.
:   [(113)](#footnoteref114)

    OECD, Entrepreneurship at a glance 2017, fig. 4.4. The percentage of firms that do not grow at all or by less than 5 % was over 45 % in Europe compared to 37 % in the US (Bravo-Biosca, 2011, A look at business growth and contraction in Europe). The tiny proportion of start-ups that do grow provide a disproportionate share of the new jobs (Marcin Szczepanski, 2017, Helping European SMEs to grow, LAB-FAB-APP, 
    <http://ec.europa.eu/research/evaluations/pdf/archive/other_reports_studies_and_documents/hlg_2017_report.pdf>
     July 2017.
:   [(114)](#footnoteref115)

    “Deep tech” refers to companies founded on a scientific discovery or meaningful engineering innovation. Arthur D. Little, 2016, Systemizing Breakthrough Innovation.
:   [(115)](#footnoteref116)

    Arthur D. Little (2016), Systemizing Breakthrough Innovation.
:   [(116)](#footnoteref117)

    The Economist: From clout to rout: June 30, 2016, 
    <https://www.economist.com/news/business/21701480-why-european-companies-have-become-fading-force-global-business-clout-rout>
     .
:   [(117)](#footnoteref118)

    Equity Funding in the EU, Deloitte (July, 2016).
:   [(118)](#footnoteref119)

    Improving Access to Finance for Beneficiaries of the SME Instrument, InnovFin Advisory (EIB), 2018.
:   [(119)](#footnoteref120)

     
    [Improving access to finance for young innovative enterprises with growth potential: evidence of impact on firms' outputs](https://encrypted.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&uact=8&ved=0ahUKEwj0s7Lvz-bZAhUBuRQKHdoeCNQQFggwMAE&url=http%3A%2F%2Fpublications.jrc.ec.europa.eu%2Frepository%2Fbitstream%2FJRC109163%2Fjrc109163_equity_final_(2).pdf&usg=AOvVaw0w-b0haatrPpGonVHwYqHc)
     [(JRC, 2017).]( (JRC, 2017).)
:   [(120)](#footnoteref121)

    From Funding Gaps to Thin Markets: UK Government Support for early-stage venture capital. Research report TM/28 (Nesta, 2009).
:   [(121)](#footnoteref122)

    Acemoglu, D., U. Akcigit, N. Bloom, and W. Kerr (2013). Innovation, Reallocation and Growth, National Bureau of Economic Research, NBER Working Paper 18993.
:   [(122)](#footnoteref123)

    PwC/CB Insights, Money Tree Report Q4 2017, p. 93. Esp. funding rounds of companies above $100 million is 5 times higher in the US and Asia than in Europe (p. 92).
:   [(123)](#footnoteref124)

    The EIB Investment Report 2017-2018 states that 'Young SMEs with radical innovative projects are the most credit-restrained category of firms' (p. 339, 
    [www.eib.org/attachments/efs/economic\_investment\_report\_2017\_en.pdf](http://www.eib.org/attachments/efs/economic_investment_report_2017_en.pdf)
    .) Also in 
    <http://bruegel.org/2015/05/are-european-yollies-more-hampered-by-financial-barriers-than-their-us-counterparts/>
     and Cincera, M., J. Ravet, R. Veugelers (2016), The Sensitivity of R&D Investments to Cash Flows: Comparing Young and Old EU and US Leading Innovators, Economics of Innovation and New Technology, 25(3), 304-20.
:   [(124)](#footnoteref125)

    Flash Eurobarometer 2014 “The role of public support in the commercialisation of innovations”.
:   [(125)](#footnoteref126)

    33% of around 1,000 investments made by European VCs are into companies based in countries outside of the VC’s domestic market. Source: Atomico, The State of European Tech 2017, p. 25.
:   [(126)](#footnoteref127)

    <https://www.project-syndicate.org/commentary/europe-startups-tech-success-by-william-echikson-2017-04>
     .
:   [(127)](#footnoteref128)

     
    <https://techcrunch.com/2017/06/07/venture-investing-in-the-us-and-europe-are-totally-different-industries/85>
     .
:   [(128)](#footnoteref129)

     
    [Financing SMEs and Entrepreneurs (2018 OECD Scoreboard, p. 23)](http://www.oecd.org/cfe/smes/financing-smes-and-entrepreneurs-23065265.htm)
    <.>
:   [(129)](#footnoteref130)

     
    [Meeting of the OECD Council at Ministerial Level Paris](https://www.oecd.org/mcm/documents/C-MIN-2017-13-EN.pdf)
    , 7-8 June 2017 (p. 16).
:   [(130)](#footnoteref131)

     
    [Improving access to finance for young innovative enterprises with growth potential: evidence of impact on firms' outputs](http://publications.jrc.ec.europa.eu/repository/bitstream/JRC109163/jrc109163_equity_final_(2).pdf)
    , JRC, 2017 (p. 5).
:   [(131)](#footnoteref132)

     
    [Access-to-finance conditions for Key Enabling Technologies (KETs) companies](http://www.eib.org/infocentre/publications/all/access-to-finance-conditions-for-kets-companies.htm)
    , EIB, 2016 (p. 4).
:   [(132)](#footnoteref133)

     
    [Shortage of Risk Capital for Europe’s High Growth Businesses AFME](https://www.afme.eu/globalassets/downloads/publications/afme-highgrowth-2017.pdf)
    , March 17 (p. 4).
:   [(133)](#footnoteref134)

     
    [The Shortage of Risk Capital for Europe’s High Growth Businesses AFME (March 2017](https://www.afme.eu/globalassets/downloads/publications/afme-highgrowth-2017.pdf)
    , p. 6).
:   [(134)](#footnoteref135)

     Citizens of EU-OECD countries score lower on their attitude to entrepreneurship and preference for self-employment than those in the US and China, e.g. the index for attitude towards entrepreneurship in 21 EU countries is 46 (males) and 31 (females), compared to 70 resp. 57 in the US, 62 resp. 54 in China and 57 resp. 35 in Korea (figures 2013): 
    <http://stats.oecd.org/index.aspx?queryid=70778>
    <.>
:   [(135)](#footnoteref136)

     
    [Financing SMEs and Entrepreneurs (2018 OECD Scoreboard, page 39)](http://www.oecd.org/cfe/smes/financing-smes-and-entrepreneurs-23065265.htm)
    <.>
:   [(136)](#footnoteref137)

    Flash Eurobarometer 433, Innobarometer 2016 – EU business innovation trends.
:   [(137)](#footnoteref138)

    Europe is host to only 19% of these companies, of which 61% are 'youngsters': founded after 1970. In Asia, the share of these youngsters is 68% and in the US even 83%. JRC-IPTS-R&D Scoreboard of the 2500 largest R&D spenders globally (2015); data from 2013. Quoted in Veugelers, 2016, Ecosystems for young digital innovators, paper prepared for the JTT special issue at the occasion of the EIED conference, Paris (2016).
:   [(138)](#footnoteref139)

    COM/2016/0733 final - Europe's next leaders: the Start-up and Scale-up Initiative.
:   [(139)](#footnoteref140)

    Global Startup Ecosystem Report, 
    <https://startupgenome.com/report2017/>
    .
:   [(140)](#footnoteref141)

    Europe's next leaders, 2017. Also in Afme, The Shortage of Risk Capital for Europe's High Growth Businesses, March 2017, p. 20, and in EIF: The European venture capital landscape, 2016, par. 3.1.1 .
:   [(141)](#footnoteref142)

    Better regulations for innovation-driven investment at EU level, Commission Staff Working Document 2016: 
    <http://ec.europa.eu/research/innovation-union/pdf/innovrefit_staff_working_document.pdf>
    . The importance of regulation for innovations is also mentioned in Atomico, The State of European Tech, 2017, p. 110 
    <https://2017.stateofeuropeantech.com/>
    .
:   [(142)](#footnoteref143)

    A.T. Kearny (2014), p. 15: Rebooting Europe's High-tech industry
:   [(143)](#footnoteref144)

    One US report states that 14 percent of European scale-ups have a “dual model”: moved headquarters abroad since the initial phases of its lifecycle. Such companies would raise 30% more capital than scale-ups that follow a domestic funding path. The most popular destination is Silicon Valley: 
    <http://mindthebridge.com/european-dual-companies/>
    .
:   [(144)](#footnoteref145)

    Cooperation within the innovation projects shall not be a requirement as they are close to the market and companies often prefer to walk that 'final mile' alone.
:   [(145)](#footnoteref146)

    According to companies participating in the business acceleration services of the SME Instrument, the exposure to a European network is crucial for building real business contacts with potential partners, clients and investors. Report: 'Is the SME-Instrument delivering growth and market creation? Analysis of first finalized Phase 2 projects, part 2 in-depth case studies, EASME Dec. 2017.
:   [(146)](#footnoteref147)

    The Group's mandate was to provide advice on how to maximise the impact of the EU's investment in research and innovation based on stakeholder feedback and the findings of the interim evaluation. The recommendations are published in the report LAB-FAB-APP, Investing in the European future we want, Lamy Group Report (2017).
:   [(147)](#footnoteref148)

    <https://ec.europa.eu/info/news/high-level-group-innovators-offer-key-recommendations-european-innovation-council-2018-jan-24_en>
:   [(148)](#footnoteref149)

    Commissioner Moedas met twice with representatives of national innovation agencies to discuss their experiences with promoting market-creating innovation, e.g. through providing coaching, loans and venture capital, lessons for the EU and ways in which EU could add additional value to their existing activities. Three workshops with experts from innovation agencies provided additional insights.
:   [(149)](#footnoteref150)

    In 2016 the Commission ran a call for ideas with a wider innovation community which gathered 1022 replies to the online questionnaire and 183 supporting documents. Overview of responses can be accessed here: 
    <https://ec.europa.eu/research/eic/pdf/eic_call_for_ideas-overview.pdf>
:   [(150)](#footnoteref151)

    These could include topics such as Artificial Intelligence, Quantum computing, Biocontrol or Second generation digital twins, or any other identified in close cooperation with Member States’ networked programmes.
:   [(151)](#footnoteref152)

     
    <https://www.darpa.mil/>
     .
:   [(152)](#footnoteref153)

    Funding - Awareness - Scale - Talent (FAST): Europe is back: Accelerating Breakthrough Innovation, Full set of recommendations from the Independent High-Level Group of Innovators on establishing a European Innovation Council, January 2018.
:   [(153)](#footnoteref154)

    Source: Joint Institute of Innovation Policy, see 'References' section.
:   [(154)](#footnoteref155)

    See section 3.4 of the Commission Communication on the Interim Evaluation, January 2018 (COM(2018) 2 final), and the recommendation of the ex-post evaluation of FP7 on: “bringing science closer to citizens” (COM(2016) 5 final).
:   [(155)](#footnoteref156)

    "The process of engagement needs to make the best use of networked technologies, reach a wide number of citizens across the European Union, and show clearly that people in every part of the Union have an opportunity to participate in setting priorities, and opportunities to become further involved in the future". Citizen Participation in FP9: A model for mission and work programme engagement. Democratic Society, February 2018, p.18. .
:   [(156)](#footnoteref157)

    Over 20 Focus Areas were introduced in Horizon 2020, and the interim evaluation found that "their multiplication resulted in some confusion" (p.149, In-Depth Staff Working Document on Horizon 2020 Interim Evaluation, SWD(2017) 220 final).
:   [(157)](#footnoteref158)

    Democratic Society (2018), p.17.
:   [(158)](#footnoteref159)

    "Missions require to set up specific governance structures with full-time professionals and to keep close contacts with all stakeholders. A balanced system of separation of powers between steering, strategic and financial decision-making and the day-to-day management is a must to establish from the outset" MOP2 study.
:   [(159)](#footnoteref160)

    https://ec.europa.eu/research/innovation-deals/index.cfm
:   [(160)](#footnoteref161)

    Mazzucato M. (2017), Mission-Oriented Innovation Policy: Challenges and Opportunities, Working Paper IIPP WP 2017-01.
:   [(161)](#footnoteref162)

    Nelson, Richard R. “The Moon and the Ghetto Revisited.” Science and Public Policy 38, no. 9 (2011): 681–90.
:   [(162)](#footnoteref163)

    Weber, K. Matthias, and Harald Rohracher. “Legitimizing Research, Technology and Innovation Policies for Transformative Change: Combining Insights from Innovation Systems and Multi-Level Perspective in a Comprehensive ‘Failures’ Framework.” Research Policy 41, no. 6 (2012): 1037–47.
:   [(163)](#footnoteref164)

    Mazzucato, Mariana. “From Market Fixing to Market-Creating: A New Framework for Innovation Policy.” Industry and Innovation 23, no. 2 (2016): 140–56.
:   [(164)](#footnoteref165)

    Foray, Dominique, David C. Mowery, and Richard R. Nelson. “Public R&D and Social Challenges: What Lessons from Mission R&D Programs?” Research Policy 41, no. 10 (2012): 1697–1702.
:   [(165)](#footnoteref166)

    A survey conducted for the Joint Institute for Innovation Policy-coordinated survey recorded 80% of respondents agreeing that cross-disciplinary and cross-sectoral calls for projects and proposals in the future is an appropriate tool for mission orientation.
:   [(166)](#footnoteref167)

    Weber, K. Matthias, and Harald Rohracher. “Legitimizing Research, Technology and Innovation Policies for Transformative Change: Combining Insights from Innovation Systems and Multi-Level Perspective in a Comprehensive ‘Failures’ Framework.” Research Policy 41, no. 6 (2012): 1037–47. See also the Joint Institute for Innovation Policy study for a profiling of different missions and their various drivers (including also geopolitical and technological challenges).
:   [(167)](#footnoteref168)

    This is the view of the ESIR expert group. In other words, contrary to the approach of previous EU Framework Programmes, setting up visible targets from the outset so that the future programme provides a reliable long-term framework incentivising private firms to invest in R&I reaping new markets. Public R&I investments have a higher economic impact if they are directed to specific missions, with targets set by policy in close interaction with both public and private actors.
:   [(168)](#footnoteref169)

    Foray, Dominique, David C. Mowery, and Richard R. Nelson. “Public R&D and Social Challenges: What Lessons from Mission R&D Programs?” Research Policy 41, no. 10 (2012): 1697–1702.
:   [(169)](#footnoteref170)

    https://ec.europa.eu/research/environment/index.cfm?pg=belmont
:   [(170)](#footnoteref171)

    http://mission-innovation.net/
:   [(171)](#footnoteref172)

    Science, Research and Innovation performance of the EU (2016); World Intellectual Property Indicators, WIPO (2015).
:   [(172)](#footnoteref173)

    Within the Programme, peer-reviewed publications with at least one associated or third country have a higher impact than other ones: European Commission (2017), Interim Evaluation of Horizon 2020, SWD(2017) 220, book, p. 115.
:   [(173)](#footnoteref174)

    A. Swan, 2015. 
    [Open Access policy effectiveness: A briefing paper for research institutions](https://zenodo.org/record/54748)
    , PASTEUR4OA project policy resources, DOI: 10.5281/zenodo.54748 (Open Access Policy Alignment STrategies for European Union Research (611742)).
:   [(174)](#footnoteref175)

    Not included here are the European Innovation Partnerships (EIPs) as they do not entail EU support for direct R&D activities.
:   [(175)](#footnoteref176)

    https://publications.europa.eu/en/publication-detail/-/publication/cc76ff75-6bff-11e3-9afb-01aa75ed71a1/language-en
:   [(176)](#footnoteref177)

    As the EIT/KICs are set-up along clear mechanisms specified in the EIT regulation, they are not included here.
:   [(177)](#footnoteref178)

    http://ec.europa.eu/growth/industry/innovation/facts-figures/scoreboards\_en
:   [(178)](#footnoteref179)

    European Commission (2017), ERA progress report 2017: The European Research Area: Time for implementation and monitoring progress, COM(2017) 35
:   [(179)](#footnoteref180)

    Commission analysis of September 2011, at the request of the Polish Presidency, see 
    <http://register.consilium.europa.eu/doc/srv?l=EN&f=ST%2014728%202011%20INIT>
     . Similar findings have been confirmed by other studies, analysis and public discussions, for instance STOA Report 'how to overcome the innovation gap' (Jan 2018) and the FP7 MIRRIS project 
    <http://www.mirris.eu/>
    .
:   [(180)](#footnoteref181)

    High Level Expert Group on the Ex-post evaluation of FP7 (2015) https://ec.europa.eu/research/evaluations/pdf/fp7\_final\_evaluation\_expert\_group\_report.pdf.
:   [(181)](#footnoteref182)

    European Parliament - STOA-Project “How to overcome the innovation gap in Europe: Structural shortcomings in the EU-13 and recommendations for a better performance in Horizon 2020”- February 2018
:   [(182)](#footnoteref183)

    In its Communication "A stronger and renewed strategic partnership with the EU's outermost regions" (COM(2017) 623 final) the Commission recognizes that participation of most of the outermost regions in the EU research programmes is still insufficient and could be significantly increased. To this end and in the context of Article 349 of the TFUE, which recognises the EU Outermost Regions specific social and economic situation, it is recommended the full eligibility of Outermost Regions for the Sharing Excellence actions.
:   [(183)](#footnoteref184)

    Based on the RHOMOLO model. European Commission, DG JRC.
:   [(184)](#footnoteref185)

    Horizon 2020 Regulation, Article 4.
:   [(185)](#footnoteref186)

    FP7 (
    <http://publications.jrc.ec.europa.eu/repository/handle/JRC96870>
    ),

    FP6 (
    [https://ec.europa.eu/research/evaluations/pdf/jrc.pdf#view=fit&pagemode=none](https://ec.europa.eu/research/evaluations/pdf/jrc.pdf)
    )
:   [(186)](#footnoteref187)

    Available at: 
    <http://data.europa.eu/doi/10.2760/459053>
:   [(187)](#footnoteref188)

    Responsible Research and Innovation is defined as an approach whereby societal actors (researchers, citizens, policy makers, business, third sector organisations, etc.) work together during the whole research and innovation process in order to better align both the process and its outcomes with the values, needs and expectations of society.
:   [(188)](#footnoteref189)

      For example, the EIT Raw Materials is based in Berlin and has Innovation Hubs in Belgium, France, Finland, Italy, Poland and Sweden and counts 116 formal Partners and another 125 participants as affiliated entities (linked third parties).
:   [(189)](#footnoteref190)

    The EIT Regional Innovation Scheme (EIT RIS) is the EIT Community’s outreach scheme. The scheme enables the transfer of good practices and know-how from the EIT’s unique approach to boosting innovation. The EIT Regional Innovation Scheme was introduced in order to share good practices and experience emerging from EIT Community activities and to widen participation in these activities across Europe.
:   [(190)](#footnoteref191)

     reduced from EUR 2.7 billion following the set-up of the European Fund for Strategic Investments (EFSI).
:   [(191)](#footnoteref192)

    COM(2017) 673 final.
:   [(192)](#footnoteref193)

    LAB-FAB-APP, Investing in the European future we want, Lamy High Level Group Report (2017)
:   [(193)](#footnoteref194)

    COMMISSION STAFF WORKING DOCUMENT on the Interim evaluation of the European Institute of Innovation and Technology (EIT) {SWD(2017) 352 final}
:   [(194)](#footnoteref195)

    The Future of EIT, Report by Commissioner Navracsics' High Level Group on the EIT, 2016
:   [(195)](#footnoteref196)

    <http://eua.be/Libraries/publications-homepage-list/eua-next-framework-programme-for-research-and-innovation-(fp9).pdf?sfvrsn=2>
    ;

    <https://www.leru.org/publications/excellent-education-in-research-rich-universities>
    ; …
:   [(196)](#footnoteref197)

    ‘We recognise the importance of the modernisation agenda and of stimulating the open science agenda, including in universities’. League of European Research Universities, Response to HLG Group report, July 2017
:   [(197)](#footnoteref198)

    The debate was in motion following the publication of the Renewed EU Agenda for Higher Education.
:   [(198)](#footnoteref199)

    The European Council debated the issue in December 2017 and called for the establishment of bottom-up networks of universities across the EU with the broad aim to strengthen research, innovation and education in Europe and to bring about more European integration through higher education.
:   [(199)](#footnoteref200)

    https://euraxess.ec.europa.eu/jobs/charter
:   [(200)](#footnoteref201)

    Ex-post evaluation of FP7, 2016.
:   [(201)](#footnoteref202)

     Fully centralised implementation: This model, used by EMRP and EMPIR, the successive public-public partnerships on metrology under FP7 and Horizon 2020, is the most integrated one. Here the whole programme, including the management of the grants, is implemented by the Dedicated Implementation Structure. Fully decentralised implementation: In this model (AAL2 and Eurostars2) the DIS is mainly organising the central evaluation and channels the EU co-funding to the national funding agencies that are managing individual national grant agreements for the funded projects.
:   [(202)](#footnoteref203)

    Under Horizon 2020, actions managed by non-Union funding bodies are not covered by the Participant Guarantee Fund (PGF). Since 2007, two Participant Guarantee Funds were created (EU and Euratom FP7) in order to protect the risk of non-recovery of sums due to the Union and to allow ongoing projects to continue in case of default of one of the beneficiaries in grants administrated by the Commission, executive agencies and the GSA (European Global Navigation Satellite Systems Agency). The positive experiences acquired during the first FP7 PGF justified its continuation in Horizon 2020 ..
:   [(203)](#footnoteref204)

    The Commission will adopt provisions for participation of beneficiaries of other Union programmes and the associated contributions to the Fund will take account of their risk profiles.
:   [(204)](#footnoteref205)

    "The first three years of Horizon 2020 have shown a significant reduction of the time elapsing between the closure of a call and the signature of the Grant Agreement (i.e. Time to Grant), from an average of 303 days in FP7 to an average of 192.2 days, which is a decrease of 36.6% (more than 110 days)". (p.55, In-Depth Staff Working Document on Horizon 2020 Interim Evaluation, SWD(2017) 220 final, May 2017)
:   [(205)](#footnoteref206)

    Art. 125 of the new EU Financial Regulation refers to "forms of Union contribution", however the more user-friendly "forms of grants" term is used in this section of the annex.
:   [(206)](#footnoteref207)

    Recital 13 of the Horizon 2020 Regulation. The flat-rate for indirect costs, the unit cost for the owners of SMEs and the unit cost based on average personnel costs also all mentioned in the core text of the Horizon 2020 Rules for Participation.
:   [(207)](#footnoteref208)

    The conditions for eligibility of these costs will be set out in the model grant agreement.
:   [(208)](#footnoteref209)

    These conditions (e.g. beneficiaries must be able to identify their actual eligible indirect costs, they must use of a fair key or driver to distribute these costs) will be further developed in the model grant agreement.
:   [(209)](#footnoteref210)

    Briefing Paper on ‘A contribution to simplification for research beyond Horizon 2020’, March 2018, available at: 
    <https://www.eca.europa.eu/Lists/ECADocuments/Briefing_paper_H2020/Briefing_paper_H2020_EN.pdf>
:   [(210)](#footnoteref211)

    In 2012-2016, the average European venture capital exit via Initial Public Offering (IPO) was nearly $ 70 million versus $ 220 million for the US: 
    <https://techcrunch.com/2017/06/07/venture-investing-in-the-us-and-europe-are-totally-different-industries/85>
:   [(211)](#footnoteref212)

    Regulation (EU) No 1290/2013
:   [(212)](#footnoteref213)

    'Horizon 2020: In Full Swing – Three Years On' brochure, January 2018 (p.46).
:   [(213)](#footnoteref214)

    COM(2012)497
:   [(214)](#footnoteref215)

    USA, China, India, Japan, South Korea, Brazil, Argentina, Chile, Russia, Australia, Algeria, Tunisia, Egypt, Jordan, Ukraine and South Africa.
:   [(215)](#footnoteref216)

    See 
    <http://ec.europa.eu/research/iscp/index.cfm?pg=countries>
     and 
    <http://ec.europa.eu/research/iscp/index.cfm?pg=regions>
:   [(216)](#footnoteref217)

    Source: CORDA, May 2018. Includes all Horizon 2020 actions, except those under ERC, MSCA, Access to risk finance, EIT, JRC, and topics using the SME Instrument .
:   [(217)](#footnoteref218)

    MSCA account for more than half of all third country participations in Horizon 2020 and around 80% of all US participations. Since 2014, almost 140 nationalities have received MSCA funding and around one in four MSCA fellows are researchers attracted to Europe from countries outside the EU Member States or the Horizon 2020 Associated Countries.

[Top](#document2)

![european flag](./../../../images/eclogo.jpg)EUROPEAN COMMISSION

Brussels,7.6.2018

SWD(2018) 307 final

COMMISSION STAFF WORKING DOCUMENT  
  
IMPACT ASSESSMENT

Accompanying the document

Proposals for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing Horizon Europe – the Framework Programme for Research and Innovation, laying down its rules for participation and dissemination  
  
DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on establishing the specific programme implementing Horizon Europe – the Framework Programme for Research and Innovation  
  
COUNCIL REGULATION establishing the Research and Training Programme of the European Atomic Energy Community for the period 2021-2025 complementing Horizon Europe – the Framework Programme for Research and Innovation

{COM(2018) 435 final}  
  
{COM(2018) 436 final}  
{COM(2018) 437 final}  
{SEC(2018) 291 final}  
  
{SWD(2018) 308 final}  
  
{SWD(2018) 309 final}

Annex: Impact assessment of the Euratom Research and Training Programme 2021-2025

Table of contents

1.Introduction: Political and legal context

1.1.Context

1.2.Scope of Impact Assessment

1.3.Lessons learned from previous programmes

1.4.Feedback from stakeholders

2.Challenges and objectives

2.1.Key features of the ongoing Euratom programme

2.1.1.
   What will be the Euratom Programme’s expected impacts under the next MFF (2021-2027) with an unchanged policy (the baseline)?
   

2.1.2.
   Main challenges and problems to be addressed by the Euratom Programme 2021-2025
   

2.2.Objectives of the Euratom Programmes for the next MFF

2.2.1.
   Main objective of the Euratom Programme
   

2.2.2.
   Revision of specific objectives and overview of other changes introduced in the future Euratom Programme
   

2.2.3.
   Success criteria for the Euratom programme 2021-2025
   

2.2.4.
   Implementation of specific objectives (should they be addressed at the level of the programme structure and priorities, and/or through the delivery mechanisms, or both?)
   

2.2.5.
   Expected impacts of the changes proposed by the future Euratom programme
   

3.Programme structure and priorities

3.1.Which actions should be broadly prioritised under Euratom Programme 2021-25 for achieving its specific objectives?

3.1.1.
   Fission research
   

3.1.2.
   Fusion research
   

3.2.Subsidiarity (EU added value/necessity for EU action) and proportionality dimensions of the Euratom programme

4.Delivery mechanisms

4.1.Main mechanisms to deliver funding under Euratom programme 2021-25

5.How will performance be monitored and evaluated?

5.1.Lessons learned from monitoring and evaluation of Euratom Research and Training Programme 2014-2018

5.2.Future monitoring and evaluation arrangements

5.3.Impact indicators

Annexes

  

Glossary

|  |  |
| --- | --- |
| Term or acronym | Meaning or definition |
| ALLIANCE | Research platform to coordinate and promote European research on radioecology ( <http://www.er-alliance.org/> ) |
| Applicant | Legal entity submitting an application for a call for proposals |
| Application | The act of a legal entity becoming involved in a proposal. A single applicant may submit applications for one or more proposals |
| Associated country | Non-EU country that is party to an association agreement with the Euratom research and training programme. It participates in the programme under the same conditions as EU Member States. Two countries are associated to Euratom programme: Switzerland (since 1979) and Ukraine (since 2016) |
| CBRN | Chemical, biological, radiological and nuclear |
| CSA | Coordination and Support Action |
| DEMO  DEMO CDA  DEMO EDA | Demonstration power plant that will generate fusion electricity  Conceptual design activity for DEMO  Engineering design activity for DEMO |
| DONES | DEMO-oriented neutron source |
| Deuterium, tritium | In nature, hydrogen comes in three forms, called isotopes. Deuterium (heavy hydrogen) is twice and tritium (super heavy hydrogen) is three times heavier than common hydrogen.  First-generation fusion power plants burn the hydrogen isotopes deuterium and tritium as fuel |
| DG RTD | European Commission’s Directorate-General for Research and Innovation |
| Divertor | Part of a tokamak where the power exhaust takes place |
| EAV | European added value |
| ECVET | The European Credit system for Vocational Education and Training |
| EESC | European Economic and Social Committee |
| EFDA | European Fusion Development Agreement |
| EFSI | European Fund for Strategic Investments |
| EJP | European Joint Programme |
| ENEN | European Nuclear Education Network |
| ENSREG | European Nuclear Safety Regulators Group |
| ERC | European Research Council |
| ESIF | European Structural Investment Funds |
| ESFRI | European Strategy Forum on Research Infrastructures |
| ESNII | European Sustainable Nuclear Industrial Initiative |
| EUROfusion | The EUROfusion consortium, launched in 2014, carries out research funded jointly by Euratom and the Member States. EUROfusion implements fusion research in line with the European roadmap to fusion electricity |
| F4E | Joint undertaking for the ITER research facility and the development of fusion energy in Barcelona, Spain |
| FIIF | Fusion Industry Innovation Forum |
| FLCM | Full lifecycle cost management |
| FP | Horizon Europe Framework Programme for Research and Innovation |
| Fusion energy | Energy released by the fusion process, a process that merges together or ’fuses’ the cores of atoms and that powers the sun and stars in our solar system |
| Generation- II/-III | Current generations of nuclear power plants |
| High-power deuterium-tritium (D-T) campaign | A type of fusion experiment in which the highest amount of fusion energy is released and the best fusion performance obtained |
| High-quality Proposal | A proposal that scores above set evaluation threshold, making it eligible for funding |
| HLW | High-level (radioactive) waste |
| IA | Impact assessment; innovation action |
| JRC | Joint Research Centre, a Directorate-General of the European Commission |
| KPI | Key performance indicator for measuring the performance and impacts of the Euratom programme |
| Magnetic confinement fusion | A fusion technology in which an extremely hot hydrogen gas, a plasma, is held together or ‘confined’ with strong magnets |
| MELODI | Multidisciplinary European Low Dose Initiative ( <http://www.melodi-online.eu/> ) |
| MFF | Multiannual Financial Framework |
| MSCA | Marie Skłodowska-Curie Action |
| NDAP | Nuclear decommissioning assistance programme |
| Newcomer | A participant in the Euratom programme who was not involved in Euratom FP7 Project |
| NMS | New EU Member States (since 2004) |
| NPP | Nuclear power plant |
| Participant | Any legal entity carrying out an action activity or part of an action under the 2014-2018 Euratom programme |
| Participation | A legal entity’s involvement of in a project. A single participant may be involved in multiple projects |
| Plasma | Plasma is a state of matter alongside solid, liquid and gas. Our sun and stars are made of plasma. Plasma is produced in fusion experiments |
| Power (energy) exhaust | A technology to control the power (energy) outflow of a fusion plasma |
| Project | Successful proposals for which a grant agreement is concluded |
| R&I | Research and Innovation |
| RIA | Research and Innovation Action |
| SME | Small or medium-sized enterprise |
| SRA | Strategic research agenda |
| STC | Scientific and Technical Committee |
| Success rate | The number of proposals that are retained for funding over the number of eligible proposals |
| TFEU | Treaty on the Functioning of the European Union |
| Third country | A country that is not a Member State of the EU. For the purposes of this document, the term ‘third country’ does not include associated countries (see above) |
| Time to grant | The time that elapses between the closing date for the call and the signing of the grant agreement, which marks the official start of the project |
| Tokamak | A torus-shaped device which uses a strong magnetic field to confine a plasm. The main device used by fusion researchers for fusion experiments |
| TRL | Technology Readiness Level. These levels measure the maturity level of particular technologies. The measurement system provides a common understanding of technology status and covers the entire innovation chain: TRL 1 – basic principles observed; TRL 2 – technology concept formulated; TRL 3 – experimental proof of concept provided; TRL 4 – technology validated in lab; TRL 5 – technology validated in relevant environment; TRL 6 – technology demonstrated in relevant environment; TRL 7 – system prototype demonstrated in operational environment; TRL 8 – system complete and qualified; TRL 9 – actual system proven in operational environment |

  

1.Introduction: Political and legal context

This impact assessment accompanies the Commission’s proposal for the Euratom research and training programme for 2021-2025 (Euratom programme). In turn, the programme complements the Horizon Europe Framework Programme for Research and Innovation (FP) in the area of nuclear research and training.

On 2 May 2018, the European Commission adopted its proposals for a new Multiannual Financial Framework (MFF) for 2021-2027. Under 
[these proposals](https://ec.europa.eu/commission/priorities/democratic-change/future-europe/eu-budget-future_en)
, the Euratom programmes will have a budget of EUR 2400 million over this period
[1](#footnote2)
. This impact assessment report reflects the decisions of the MFF proposals and focuses on the changes and policy choices, which are specific to this instrument.

The Euratom programme is one of the spending programmes that will implement the Commission’s vision for the period beyond 2020. Bearing in mind the lessons learned and progress achieved so far, the impact assessment will look at whether the existing programme should continue with its present form or undergo changes to its scope and structure.

1.1.Context

Research and innovation (R&I) programmes are crucial for implementing the Commission’s vision as set out in the proposal for the next MFF. The Commission’s reflection paper on the EU’s finances
[2](#footnote3)
 and the its Communication on the future MFF
[3](#footnote4)
 both highlight the significant role and added value of research programmes supported from the EU budget. R&I programmes are key in improving people’s well-being, creating growth and jobs and finding solutions to a range of challenges.

Nuclear and radiation technologies continue to play an important role in the lives of all Europeans, in that they influence energy and climate change policies, security of supply, energy research and the use of radiation and radionuclides in non-power (medical, industrial, etc.) applications. The secure and safe use of these technologies remains paramount. R&I programmes play a key role in maintaining and using the highest standards of safety, security, waste management and non-proliferation and in retaining Europe’s leadership in the nuclear domain so as not to increase energy and technology dependence — this being one aim of the Energy Union
[4](#footnote5)
.

The Euratom programme is an EU-funded thematic research and training programme operating in scientific and technical areas covered by the Euratom Treaty
[5](#footnote6)
. The Council adopts the programme by unanimous agreement based on Article 7 of the Euratom Treaty.

The funded research focuses on nuclear safety, safeguards and security, radioactive waste management, radiation protection and fusion energy. The promotion of nuclear research remains a key provision of the Euratom Treaty (Article 4), which derogates from the general provisions for research under the Treaty on the Functioning of the European Union (TFUE).

As a result, EU R&I programmes (currently Horizon 2020) do not fund topics covered by the Euratom Treaty; only the Euratom programme supports research at European level in this field. Until today, nuclear researchers were not eligible for funding from bottom-up EU programmes such as the European Research Council (ERC) or Marie Skłodowska-Curie Actions (MSCAs).

The current Euratom programme will end on 31 December 2018
[6](#footnote7)
. On 1 December 2017 the Commission submitted to the Council a proposal
[7](#footnote8)
 to extend this programme until 2020 to bring it into line with the current seven-year MFF, running from 2014 to 2020.

Other MFF-related proposals are closely linked to the Euratom programme and more should be done to exploit the synergies between them (see Table 1).

|  |  |
| --- | --- |
| Table 1 — Synergies with other MFF-related proposals | |
| Proposed programmes for the new MFF | Links to Euratom programme 2021-2025 |
| Horizon Europe Framework Programme for Research and Innovation | The Euratom programme complements the Horizon Europe Framework Programme’s research activities and shares the same rules for participation. The main features of the delivery mechanism for the Euratom programme (calls, funding model) will also be shared with the Framework Programme. Implementing the specific objectives of the future Euratom programme will require cross-cutting actions with the Framework Programme to tackle today’s societal challenges. There will be access for nuclear researchers to horizontal programmes, such as MSCAs (which will support the Euratom programme’s education and training goals). |
| Union Funds under shared management | The future Union Funds under shared management (in particular the ERDF, ESF+ and EAFRD) will provide a large share of the EU funds for R&I. Holders of Seal of Excellence awards from directly managed Union programme should be eligible for this funding. |
| ITER | ITER will be a key research infrastructure for the Euratom programme’s implementation of the European roadmap to fusion electricity, starting in 2025. The Euratom research programme (implemented by DG RTD) will be carried out in full complementarity and coordination with the activities of DG ENER (responsible for ITER) in support to the construction of ITER and preparation of operation and Broader Approach activities. |
| Nuclear Decommissioning Assistance Programmes (NDAP) and JRC decommissioning | The NDAP and JRC programmes should provide feedback from decommissioning activities as input for future research in this field. The Euratom programme will fund research activities supporting the development and evaluation of technologies for the decommissioning and environmental remediation of nuclear facilities. The programme will also support the sharing of best practices and knowledge on decommissioning. |

1.2.Scope of impact assessment

This impact assessment focuses on the outcome of the Euratom programme’s interim evaluation and stakeholder consultation. This will help determine any changes needed in the programme’s scope, aims and delivery method, taking into account cross-cutting objectives under the new MFF (flexibility, focus on performance, coherence and synergies, simplification). It also meets the requirements of the Financial Regulation as regards preparing an ex-ante evaluation for the proposed Council Regulation establishing the Euratom Research and Training Programme 2021-2025.

However, it does not cover the rules for participation. As is currently the case with Horizon 2020 and the Euratom programme, these will be shared with the Horizon Europe Framework Programme for Research and Innovation (see the IA for the Horizon Europe). Neither does it cover ITER
[8](#footnote9)
, which is an essential element of the European fusion roadmap
[9](#footnote10)
. The impact assessment concerning the financing and the activities of the Fusion for Energy Joint Undertaking (F4E) – the EU’s implementing agency for the ITER construction and Broader Approach activities, among others – is provided in a separate document.

The impact assessment for the Horizon Europe Framework Programme provides details of the related structural and policy issues affecting European R&I in general. Many of these issues are equally relevant for the Euratom programme, though the particular features of the nuclear research sector should be borne in mind. These include the need for large and expensive research infrastructures and high levels of public funding in some key areas (e.g. fission and fusion research or advanced materials).

The programme centres specifically on: safety at existing (fission) nuclear power plants; the lower proportion of SMEs in some areas because of the cost of research and related infrastructures; significant involvement from national public bodies/agencies; a sharper focus on education and training; and, last but not least, the fundamental importance of international cooperation. Where the impact assessment for the Horizon Europe is considered inadequate or inapplicable for the specific case of Euratom research, the issues are addressed in this document.

1.3.Lessons learned from previous programmes

Evaluations of successive Euratom programmes have shown how European support is vital for nuclear research to continuously enhance the safety and security of nuclear technologies.

The key findings from the interim evaluation of the 2014-2018 Euratom programme are set out below
[10](#footnote11)
.

a)Continue supporting nuclear research focused on nuclear safety, safeguards, security, waste management, radiation protection and development of fusion

The interim evaluation concluded that the Euratom programme is highly relevant across all activities, including nuclear safety, security and safeguards, radioactive waste management, radiation protection and fusion energy. Actions at European level in nuclear research continue to be instrumental in maintaining and using the highest standards of safety, security, waste management and non-proliferation, and in retaining Europe’s leadership in the nuclear domain
[11](#footnote12)
.

b)Further improve, together with beneficiaries, the organisation and management of the European Joint Programmes in the nuclear field.

The interim evaluation of the Euratom programme 2014-2018 found that the introduction of the European Joint Programme (EJP) Cofund action had been a success. The EJP instrument is designed to support coordinated national R&I programmes. It aims at attracting and pooling a critical mass of national resources for the Euratom programme’s objectives and at achieving significant economies of scale by gathering related Euratom resources around a joint effort.

The independent group of experts running the evaluation made specific recommendations to improve the organisation and management of the EJPs in the nuclear field. These recommendations, while not questioning the basic structure or approach, require further refinements and changes to the EJP for it to remain effective going into the next programming period (2021-2025 and beyond). For more details on these recommendations and how the Commission’s services addressed them, see section 4.1 (delivery methods for the funding under the future programme).

c)Continue and reinforce the Euratom education and training actions for developing competencies in the nuclear field which underpin all aspects of nuclear safety, security and radiation protection

The interim evaluation underlined the importance of developing comprehensive action for maintaining and developing nuclear skills in Europe, while also finding synergies with the Framework Programme’s actions supporting education and training.

Maintaining competencies in safety, radiation protection and safeguards in nuclear regulatory authorities and the nuclear industry will be one of the critical challenges to effective regulation of nuclear power, nuclear science and ionising radiation technology applications in the coming decades. The challenge arises from the age profile of staff in the regulatory bodies — natural wastage (mostly due to retirement) over the next decades could see the present nuclear safety knowledge base disappear — and from a decline in the numbers of nuclear science and engineering students.

In this context, the interim evaluation concluded that some specific changes should be implemented to give the Euratom programme greater impact in this area. The Euratom indirect actions in education and training should have more specific and measurable objectives. On the other hand, the Joint Research Centre (JRC) should enhance access to its research infrastructures and reinforce its education and training activities — in particular, hands-on practical training and work experience. The independent expert group proposed that students and researchers in the nuclear field should be eligible to take part in MSCAs, which provide mobility grants, and foster career development. In fusion research, the EUROfusion consortium should put more emphasis on training nuclear engineers and technologists for the next phase — the design of a demonstration fusion power plant.

d)Further exploit synergies between Euratom programme and other thematic areas of the Framework Programme to address cross-cutting aspects such as the medical applications of radiation, climate change, security and emergency preparedness and the contribution of nuclear science

The interim evaluation concluded that the Commission should aim at developing joint research actions on the radiation protection aspects of medical practices, as well as innovative nuclear medicines. Euratom should not develop such research alone, but do so jointly with the health part of the Horizon Europe. The Commission should also seek other synergies between nuclear and non-nuclear activities and nuclear science applications such as security of energy supply, public involvement in decision-making, security of supply of medical radioisotopes and nuclear sciences applications in support of the sustainable development goals.

e)Further exploit synergies between direct and indirect actions of the Euratom programme

The interim evaluation recommended that the Commission should implement coherent programming of the direct and indirect actions of the Euratom programme, with well-defined governance and decision-making processes. This will help achieve maximum synergy between the indirect and direct actions, and enable the programme to operate with maximum efficiency and the most effective results possible. One scenario could be that JRC might cease to participate in Euratom calls for proposals if a mechanism on the role and participation of JRC in the indirect actions funded by Euratom is established. Instead, when proposing research topics a process should be established to allow the JRC to contribute with its direct actions to the projects with its competences and expertise including an open access to its research infrastructures to all interested consortia.

1.4.Feedback from stakeholders

To gather information on the programme’s performance and on the research challenges to be addressed in the future, in 2017 and 2018 the Commission held two consultations, a roundtable on decommissioning, and a workshop with stakeholders to explore their specific needs. It also received an opinion from the Euratom Scientific and Technical Committee (STC)
[12](#footnote13)
.

The input given was consistent with the findings from the Euratom programme’s interim evaluation and provides additional insights into issues of importance to nuclear research in Europe. The Commission used this important feedback in drafting this impact assessment and the proposal for the Euratom programme, in particular on the scope and delivery mechanism.

The 2018 consultation, to which the Commission received 353 responses, was addressed specifically to research stakeholders such as technology platforms, nuclear regulators, public research bodies, universities and technical support organisations. The main purpose of the consultation was to seek stakeholders’ views on the issues that the Euratom programme 2021-2025 should address, the programme’s support for access to infrastructures, education and training, and the integration of direct and indirect actions.

The 2017 consultation
[13](#footnote14)
 was an open public consultation to evaluate the Euratom programme from 2014 to2018 and prepare for its extension to 2019 and 2020. The Commission received 323 responses from individuals, research stakeholders and public authorities.

Table 2 provides an overview of the key messages from both consultations. For an overview of all replies from the 2018 consultation, including all position papers, see Annex 2.

|  |  |
| --- | --- |
| Table 2 — Key messages from 2017 and 2018 consultations | |
| Scope of programme | -The programme should continue to cover current research areas (nuclear safety, security, radioactive waste management, radiation protection, fusion energy) but funding should be more focused to maximise impacts.  -Research on ionising radiation and nuclear science (medical applications) should be supported by joint initiatives funded by Euratom and other programmes (for example, the health part of the Horizon Europe) or by research programmes other than Euratom.  -The Euratom programme should play a larger role in decommissioning, although stakeholders consider that Programme should be focused mainly on specific issues in decommissioning, such as skills development and exchange of best practices. |
| Instruments to be used | The future programme should continue to use current instruments to support research (research and innovation actions, innovation actions, coordination and support actions, European Joint Programmes). |
| European added value | European added value has come in the form of: funding for research, access to knowledge and/or nuclear facilities not available or difficult to acquire at national level, skills development, the establishment of research networks, and acquiring a critical mass of resources. |
| Access to R&I infrastructures | The Euratom programme should support access to relevant research infrastructures in Europe, including the JRC infrastructures. |
| Role of direct actions of the Euratom programme (carried out by the Joint Research Centre) | -The JRC should provide independent scientific advice in Europe and support for EU policies.  -It should carry out research complementing national initiatives and develop a knowledge management centre for Euratom research.  -Preferably, it should not compete in Euratom calls for proposals, but instead provide in-kind contribution in research to Euratom indirect actions. It should also play a coordinating role in knowledge management for the research results obtained. |
| Support for education, training, mobility | The programme should shift more resources towards addressing basic needs in education and training and mobility. Researchers would benefit from individual support when it comes to fellowships for PhD and postdoc researchers. The programme should support networking and exchanges among researchers and access to infrastructures, including the Commission’s research infrastructures. |
| Fusion energy research | The creation of EUROfusion is an improvement (according to more than two-thirds of stakeholders). Researchers should enjoy greater mobility. |

In February 2018 the Commission organised a workshop for research stakeholders and representatives of Member States on the following theme: ‘Euratom Nuclear Fission Research and Training — What are the new specific needs?’ Table 3 below gives the key messages from the workshop
[14](#footnote15)
.

  

|  |  |
| --- | --- |
| Table 3 — Key messages from 2018 workshop | |
| Research infrastructures in nuclear field | Euratom support for accessing research infrastructures, including the JRC, should be developed taking into account the different needs of stakeholders (open access for academia, commercial access for industry) and the range of access conditions (type of infrastructure, duration of access, size of team, technical support needs, etc.). Funding researchers’ travelling, lodging and living costs should be also considered. Mapping research infrastructures and prioritising them for Euratom support should follow once open access is guaranteed. |
| Nuclear education and training at EU level | Education and training in nuclear issues is closely linked to research infrastructures in this field. The issues are of a complexity that requires hands-on training to pass on know-how efficiently. As both the infrastructures and the workforce are ageing, it is important to maintain the European capabilities necessary for anticipating future nuclear safety challenges in operating the current nuclear fleet. At the same time, it is important to make nuclear education more attractive to a younger generation by laying the foundations for research into forward-looking technologies, and also to be open to countries where major development is ongoing. One of the key challenges is trans-European knowledge-sharing and transfer across different fields and generations. |
| Nuclear science and ionising radiation technology applications | Nuclear science and ionising radiation technology applications, which go beyond the classical power sector, are increasingly important for medical, industrial and space applications, for instance. Nuclear medicine depends on the development of new pharmaceuticals and the transition from research to clinical practice, security of supply of radioisotopes and is governed by radiation protection and pharmaceutical legislation. The EU is a leader in this field and there is strong societal interest to further develop it. For this reason, maintaining European nuclear infrastructures and knowledge is critical for the development and sustainability of these applications, and the regulatory framework and research funding should be properly coordinated in the EU. |
| Innovation in nuclear research | In nuclear safety, it is vital to maintain know-how about the existing nuclear fleet and anticipate future nuclear safety challenges needs to be ensured. A bridge between research activities in the medical and non-medical sectors will be beneficial for both. The early involvement of the regulators is needed to facilitate the deployment of innovative technologies. |

The 2017 opinion from the STC, the advisory committee appointed by the Council, on future Euratom research and training programmes included the following remarks (excerpt):

-the urgent need for a coordinated and coherent approach to infrastructure investment. This will ensure that the EU gives value for money; that it provides for appropriate leverage both between and within the ‘direct actions’ and ‘indirect actions’ components of the Euratom research and training programme; and that it delivers enduring capacity and capability in facilities that underpin nuclear technology and that are vital for Member States in all related fields, including those essential for medicine and radiation protection, security and safeguards;

-The need for Europe to continue maintaining skills and knowledge in advanced nuclear systems to be able to fulfil its potential and occupy its rightful position in the evolving international initiatives in this field ensuring the highest standards of safety, security, waste management and non-proliferation are achieved and maintained globally;

-the need to continue the R&D efforts on waste management and geological disposal in the existing reactor fleet;

-the significant cross-cutting benefits that can be realised between fission and fusion energy research programmes as the latter evolves from one focused on basic plasma physics to one focused more on technology and nuclear-related aspects;

-the need to pursue efforts on radiation protection research where the focus remains on low-dose risk, which has important implications for EU citizens in view of the growing exposure from medical diagnostic and therapeutic practices, and in which research actions should therefore be co-funded by the Horizon 2020 health programme. This would free up limited Euratom funding for nuclear technology priorities, such as the efficient production of radioisotopes for medical purposes and biological research;

-the need for the European programmes to include R&D in dismantling and decommissioning activities, so as to maintain the capacity and capability to undertake them in the future. The report recognises that there is presently no Euratom funding for this type of research;

-the paramount importance of guaranteeing an adequate supply of experts and trained workers — in view of the increasing demand across all disciplines, coupled with the ageing and imminent retirement of a generation of experts — and the role that the Euratom programme, as a research and training programme, can and should play in ensuring that supply.

2.CHALLENGES AND OBJECTIVES 

2.1.Key features of the ongoing Euratom programme

Key features of the current Euratom research and training programme 2014-2018 are:

·A five-year cycle (2014-2018) with a budget of EUR 1.6 billion. The Council may extend the programme for two years to match the seven-year duration of the Horizon 2020 Framework Programme and MFF.

·Support for nuclear research in Europe, with a focus on safety, waste management and radiation protection, as well as nuclear security and safeguards.

·Allocation of research funding through an EU-wide competition based on excellence as the guiding principle and main evaluation and selection criterion
[15](#footnote16)
.

·Central management of the programme by the Commission.

The Euratom research and training programmes have been implemented by the Commission since 1959. The 2014-2018 programme provides funding for nuclear research in nuclear fission and fusion. Fission research covers nuclear safety, security, safeguards, waste management and radiation protection. Fusion research deals with the development of fusion energy. The Council Regulation establishing the current programme sets out the broad lines of action and the budget envelope. The Euratom work programmes for direct and indirect actions define the detailed priorities, budget and instruments to be used, usually on a biennial basis.

The Commission implements the programme through direct and indirect actions. The ‘direct actions’ concern research carried out by the Commission through its JRC and are focused only on fission research (nuclear safety, safeguards and security, radioactive waste management and radiation protection, including support for the relevant EU policies). The ‘indirect actions’ concern research carried out by trans-European project consortia of private and public research groups. They address not only the safety of nuclear systems, waste management and radiation protection, but also the feasibility of fusion as a power source. Consequently, the indirect actions of the Euratom programme concern both nuclear fission and fusion.

Table 4 illustrates the different types of instruments used by the programme and the budget allocated to them.

|  |  |  |  |
| --- | --- | --- | --- |
| Table 4 — Types of funding instruments in the Euratom Programme and % of budget allocated | | | |
| Category of funding instrument | Sub-categories | Purpose of instrument | % of total budget |
| Grants | EJP | European Joint Programme Cofund actions designed to support coordinated national research and innovation programmes  (31% of total Euratom budget) | 48 % |
|  | RIA | Research and innovation actions to fund research projects tackling clearly defined challenges, which can lead to the development of new knowledge or a new technology  (17% of total Euratom budget) |  |
|  | IA | Innovation actions focused on closer-to-the-market activities (prototyping, testing, demonstrating) |  |
|  | CSA | Coordination and support actions to fund the coordination and networking of research and innovation projects and programmes |  |
| Direct JRC actions | | Funding for research carried out by the Joint Research Centre of the European Commission | 35 % |
| Contracts based on Article 10 of the Euratom Treaty | | Contracts between the Commission and research infrastructure operators, providing researchers with access to the infrastructures | 16 % |
| Loan-based financial instruments | InnovFin | Loans to support fission R&I projects for the construction or refurbishing of research infrastructures | 1 % |
| Prizes | Recognition Prizes | Financial prize following a contest in order to recognise past achievements and encourage future activities | <1% |

Source: European Commission

The bulk of the budget (almost half in all) is used for different types of grants, including EJP Cofund actions, collaborative research and innovation actions, coordination and support actions and innovation actions. Direct research actions implemented by the JRC
[16](#footnote17)
 form the second most important category. The third is made up of contracts supporting the use of research infrastructures in fusion research (based on Article 10 of the Euratom Treaty). Other types of actions include recognition prizes and financial instruments.

As for research priorities, 55 % of the programme’s budget is allocated to fission research
[17](#footnote18)
, in particular nuclear safety, security and safeguards (see Table 5). This research is implemented through all instruments available to the programme, except Article 10 contracts. The programme’s second priority, accounting for 45 % of the total budget, is fusion research, implemented mainly via EJP Cofund and an Article 10 contract.

|  |  |  |  |
| --- | --- | --- | --- |
| Table 5 — Fields of research funded, instruments used and budget allocated under  Euratom research and training programme 2014-2018 | | | |
| Field | Average annual budget | Funding instruments used | Annual average budgets per subfield of research  (in millions of euros and in %) |
| Nuclear fission\* | 175 (55%) | Direct actions,  EJP, RIA, IA, CSA, InnovFin |  |
| Fusion energy | 145 (45%) | EJP, Article 10 contracts, prizes |  |
| Total | 320 (100%) |  |  |

\_\* Combined data for direct and indirect actions. Source: European Commission

The key feature of the programme is the way detailed priorities and assigned budgets are established through work programmes in close consultation with Member States and research stakeholders.

The Euratom direct actions consist of research activities managed and carried out by the JRC on its different nuclear sites. The work programme for direct actions is a biennial rolling programme revised every year. After a planning phase performed by the JRC, the work programme is sent via inter-service consultation for comments from other Commission departments, and to the JRC Board of Governors (composed of representatives from Member States and associated countries) for their opinion. Once their feedback has been received and processed, the programme is formally adopted in a Commission implementing decision
[18](#footnote19)
, including the key orientations for the JRC work programme
[19](#footnote20)
.

The work programme for indirect actions defines details of the corresponding open calls for proposals. After the Programme Committee (consisting of Member State representatives) has given its view, the Commission formally adopts the Euratom work programmes. Applicants from industry, academia, national nuclear research centres and other stakeholders submit proposals in response to calls; these are then evaluated by panels of independent experts. The list of proposals to be funded has to be approved by the Programme Committee.

Research in fusion energy is implemented by a named beneficiary, the EUROfusion consortium. This consortium, whose members are nominated by the Member States and associated third countries, has a mandate to implement the European fusion roadmap through the EJP with a rolling annual work plan.

2.1.1.What will be the Euratom programme’s expected impacts under the next MFF (2021-2027) with an unchanged policy (baseline scenario)?

The continuation of the ongoing programme is expected to promote scientific excellence in nuclear research in Europe, generate new knowledge in the nuclear field and maintain nuclear skills for nuclear safety, safeguards, security, waste management and radiation protection. The future programme with the present objectives (unmodified from its predecessor) will keep delivering impacts in the key areas (see Table 6). Although the specific objectives will remain unchanged, the detailed research priorities may shift in line with evolving needs and be reflected in the biennial work programmes adopted for direct and indirect actions.

|  |  |
| --- | --- |
| Table 6 — Expected impacts of the Euratom programme 2021-25   with unchanged policy (baseline) | |
| Field | Expected impacts |
| Nuclear safety | Reinforcement of nuclear safety thanks to the research support for the development of:  -accident management strategies mitigating accidents’ consequences  -updated knowledge on fuel properties under normal and accidental conditions and on the ageing and safe long-term operation of nuclear power plants (NPPs).  -updated tools and models for safety assessments on operating NPPs, pre-normative materials qualification  -safety and risk assessment of different innovative concepts of NPPs and minimisation of long-lived waste  Research results will help Member States implement the 2014 Nuclear Safety Directive |
| Nuclear security | Improved nuclear security due to:  -better knowledge of how to mitigate the risks associated with radioactive materials outside regulatory control  -better detection and identification (forensics), closer cooperation and greater exchange of knowledge  -optimised response to security threats through training activities and transfer of knowledge |
| Nuclear safeguards | Euratom and international safeguards systems rendered more effective by:  -enhancing the measurement capacity for nuclear materials  -testing and developing integrated solutions, techniques and models for safeguards  -developing further concepts and analysis of open source and trade information |
| Nuclear standards | -Pre-normative research on nuclear structural materials, resulting in codes and standards, novel test techniques and advanced inspection procedures  -Development of nuclear reference materials, standards and measurements for benchmarks to control environmental radioactivity measurements and to check conformity assessments |
| Radioactive waste management | Safer management and disposal of radioactive waste thanks to:  -better knowledge of the safe start of operations of geological disposal facilities for high-level radioactive waste/spent nuclear fuel  -research support to help Member States make progress with their national programmes for waste management in line with requirements of Directive 2011/70/Euratom  -mitigation of the risks associated with the management of high-level radioactive waste by developing models for safe disposal and improved design and technologies in support of the facilities  -safe management of innovative spent fuels and waste (small modular reactors, accident-tolerant fuels)  -improved standards and technology for the characterisation, management and disposal of other radioactive waste categories |
| Radiation protection | Higher health protection for individuals subject to occupational, medical and public exposure to ionising radiation, thanks to:  -better knowledge of the long-term effects of low doses of radiation  -a higher level of emergency preparedness  -more effective monitoring of radioactivity in food and on the environment, and more standardised measurement methods  -better knowledge of the effects of the exposure to ionising radiation used for medical diagnosis and treatment and how to reduce it  Research results will help Member States implement the Basic Safety Standards Directive |
| Fusion energy | -A significantly expanded knowledge base of ITER-relevant fusion science will increase ITER’s chances of achieving its goals of proving the feasibility of fusion for power generation.  -Developments in fusion technology will allow for the start of the conceptual design phase for a demonstration fusion power plant  -The development of high-tech solutions in the field of fusion technology will, with an appropriate technology transfer programme, generate spin-offs that benefit industry, the economy and society in areas beyond fusion applications |
| Education and training | -Preservation of knowledge and improved transfer between generations and across national programmes in nuclear fission  -Training scientists and engineers will secure the human resources needed to run ITER and design future fusion power plants  -Knowledge management activities will guarantee that experience from the ITER project will be retained and fed into work to design and construct a demonstration fusion power plant |
| infrastructures | Support for the availability and accessibility of relevant fission and fusion research facilities will bring all specific objectives of the programme closer. Examples of specific impacts:  -the scientific/technical basis for power handling components of a fusion power plant  -prototyping of technology for a fusion materials testing facility will provide the information needed to start the construction of such a facility  -Sharing facilities will put them to full use, step up collaboration and allow for hands-on training |
| Support for policy | -Nuclear and ionising policy formulation based on sound scientific advice  -Harmonisation of safety assessment methods, standards and tools and sharing of best practice for better implementation of directives in nuclear safety, spent fuel and radioactive waste management  -Monitoring of and support for policy implementation  -Trustworthy evaluation of policy effectiveness and impact |

Negative impacts of the baseline scenario will be as follows:

-Limited (sub-optimal) impacts in education and training (no introduction of MSCAs) would result in a shortage of skilled and experienced staff in the nuclear and radiation field. At the international level, the EU might lose its position as world leader in nuclear and radiation technologies and might not be able to play an active role in spreading its high nuclear safety standards and safety culture. There would be insufficient expertise to operate fission technologies and a lack of specialised skills and knowledge transfer in both industry and science.

-Limited development of knowledge management would lead to loss of knowledge needed for the safe operation of existing reactors, for the management of spent fuel and radioactive waste (including repositories) and for the highest level of safeguards and security, and could lead to a defective transfer of knowledge.

-Limited networking, infrastructure-sharing and open access programmes would result in sub-optimal exploitation of existing and new infrastructures. The lack of new investment and key research infrastructures in fission would be a major hindrance. Hence the genuine need to pool resources at all levels (both private and public and at EU, national and regional levels) to overcome such obstacles.

-Limited emphasis is given in the baseline scenario to nuclear science and ionising radiation technology applications. The radiation protection aspects of the effects of ionising radiation used for medical diagnosis and treatment on patients are included. However, the safe use of nuclear science and ionising radiation technology applications for medical, industrial, space and research applications is an important area which is not sufficiently covered in the baseline scenario. This could mean higher risks of population exposure to ionising radiation in medical treatments, or of environmental exposure to natural or man-made forms of radiation.

-Unless the most is made of the synergies between direct and indirect actions in the Euratom programme and between the Euratom programme and other thematic areas of the Horizon Europe, future research programmes programmes will not maximise their impact in areas such as nuclear safety, waste management, radiation protection, medical applications of radiation, research infrastructures, etc.

-The success of ITER implies maintaining the level of support that is currently provided from the coordinated operation of the various infrastructures in the programme. In addition to this, a forward-thinking programme must make available new research infrastructures of relevance to ITER and DEMO
[20](#footnote21)
. These might include a high magnetic field superconducting tokamak and a fusion neutron-relevant materials testing facility. If the necessary resources for such facilities and the accompanying research, training and education actions (including access to MSCAs) are not forthcoming, the successful operation of ITER and the design of DEMO will be significantly damaged, bringing delays to the programme and associated increases in costs.

-No clear direction on decommissioning research may lead to delays in implementing decommissioning strategies and modern techniques, and may give rise to shortcomings in sharing best practice and knowledge on decommissioning.

2.1.2.Main challenges and problems to be addressed by the Euratom programme 2021-2025

The future Euratom research and training programme should address the following research challenges:

a)Nuclear safety

The safety of nuclear energy production in the EU — and the safety of other nuclear installations such as spent fuel storages and fuel enrichment and reprocessing plants — are the primary responsibility of NPP operators supervised by independent national regulators. An EU-wide approach to nuclear safety is important, since a nuclear accident could badly affect countries across Europe and beyond. Following the Fukushima-Daiichi accident in 2011, Council Directive 2009/71/Euratom establishing a Community framework for the nuclear safety of nuclear installations was revised. The 2014 Directive
[21](#footnote22)
 introduces a high-level, EU-wide safety objective to prevent accidents and avoid radioactive releases outside a nuclear installation. For plants already in operation, this objective should lead to the implementation of practical safety improvements. For future plants, significant safety enhancements are planned, based on the scientific and technological state of play. The Directive highlights the need for Member States to use research results in its implementation and creates a system of peer reviews.

The research priorities in nuclear safety are continuously evolving (see Figure 1) in line with the state of the art, as witnessed from the feedback from ongoing Euratom projects, updated strategic research agendas (SRAs) from technology platforms such as SNE-TP (NUGENIA), and feedback from implementation of the 2014 Safety Directive. In this regard, the results of the topical peer review on ageing management of nuclear power plants organised by European Nuclear Safety Regulators Group (ENSREG), expected in 2018, will serve as important input for the research agenda. Other leading stakeholders providing inputs are ETSON and WENRA (see Figure 1 below). On this basis, the Commission can ensure that the work programmes containing future calls for proposals funded by the Euratom programme are up-to-date and address current needs, including safety assessments for any innovative concepts.

  

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
| Figure 1 — Overview of inputs for establishing research priorities in nuclear safety | | | | |
|  |  |  |  |  |
| Nuclear Safety Directive |  |  |  | Strategic research agenda of SNE-TP |
|  |  |  |  |  |
| Outcome of topical peer reviews carried out by  European Nuclear Safety Regulators Group (ENSREG) |  | Research priorities on nuclear safety to be funded by Euratom programme |  | European Technical Safety Organisations Network (ETSON) |
|  |  |  |  |  |
|  |  | Ongoing and completed Euratom projects |  | Western European Nuclear Regulators Association (WENRA) |

An example of detailed feedback on current research priorities is given in Table 7 below.

|  |  |
| --- | --- |
| Table 7 — Stakeholder feedback on current research priorities in nuclear safety  Input from European Technical Safety Organisations Network | |
| -Safety assessment methods (safety margins methodology, deterministic and probabilistic approaches)  -Multi-physics multi-scale safety approach  -Ageing of materials for a long-term operational perspective  -Fuel behaviour (loss of coolant accident, RIA or reactivity insertion accident, criticality)  -Human and organisational factors in safety management  -Instrumentation and control (I&C) systems | -Internal and external loads and malicious acts (integrity of equipment and structures, fire propagation, etc.)  -Severe accidents phenomenology and management  -Emergency preparedness and management  -Extreme natural and unintended man-made hazards  -Preventing and controlling abnormal operation and failures  -Defence in depth — prevention of (severe) accidents through decay heat removal from the reactor core and the spent fuel pool (SFP), and secondly the protection of the containment integrity.  -Controlling severe conditions, including prevention of accident progression and mitigation of severe accident consequences |
| Source: ETSON views on R&D priorities for implementation of the 2014 Euratom Directive on safety of nuclear installations, Kerntechnik 81(2016), Position paper of the technical safety Organisations: Research needs in nuclear safety for GEN 2 and GEN 3 NPPs, October 2011 | |

b)Radiation protection and ionising radiation applications

A growing number of different applications of ionising radiation requires protection of the people and the environment from unnecessary exposure to radiation. Ionising radiation technologies are used every day in Europe in a number of fields such as health, industry and research, providing large benefits to European citizens and European economy
[22](#footnote23)
. Research plays key role, providing for better understanding of harmful effects of radiation from natural and artificial sources, and expanding beneficial applications of radiation technologies.

Naturally occurring radioactive isotopes of uranium, thorium, potassium and carbon constitute Europeans’ main source of exposure to radiation. Almost equally important are X-rays, used in medical diagnostics or therapy, whose contribution is increasing as medical procedures continue to rise (see Figure 2).

   Source: ASN, 2010 

Low dose research

At the European level, efforts have been under way since 2007 to establish and bring together European platforms for radiation protection research in the five key areas of low dose risks, dosimetry, emergency and preparedness, radioecology and medical applications. The platforms concerned are MELODI, EURADOS, NERIS, ALLIANCE and, more recently, EURAMED. Following the establishment in 2015 of the European Joint Programme in radiation research (CONCERT), all of these platforms have entered into close cooperation, including the development of SRAs, listing the general and specific research priorities within their disciplines
[23](#footnote24)
.

These SRAs indicate that a key priority for radiation protection research is to improve health risk estimates for cases of exposure matching the dose limits for occupational exposure and the reference levels for the exposure of the population in emergency situations.

In addition, new challenges have emerged recently with the adoption of the Basic Safety Standards Directive that regulates practices involving ionising radiation in fields such as industry and medicine
[24](#footnote25)
.

Recent tests carried out by the JRC in Member State laboratories highlighted major gaps in monitoring radioactivity in drinking water and in air. These should be addressed through support for measurement laboratories. For there to be comparable data between Member State laboratories, further work will be needed on primary standards, reference materials and measurement methods.

The main uncertainties in radiation health risk evaluation are in the magnitude of cancer risk at low and protracted doses below 100 mSv, the magnitude of non-cancer effects below 500 mSv and the variation in disease risk between individuals in the population. Therefore, the key research questions are: the dose and dose-rate relationship for cancer; non-cancer effects; and individual radiation sensitivity (see Figure 3).

|  |
| --- |
| Figure 3 — Key research questions for low dose research |
|  |
| Source: MELODI |

Research at low dose rates or low doses presents significant challenges in the investigation of both radiation-related health effects and underlying biological mechanisms because the magnitude of health risk and biological effects is expected to be low. A multidisciplinary approach is therefore essential.

Medical applications of radiation

The health domain is by far the most important domain in Europe, where ionising radiation is used in terms of the number of people affected and from an economic perspective (employment, market and its growth rate). Radiation technologies are used in the health sector, both for diagnostics (imaging) and treatment (therapy). There are about 100 different nuclear imaging procedures available today and over 10 000 hospitals worldwide use radioisotopes; the vast majority of the medical procedures (about 90 %) are for diagnosis
[25](#footnote26)
.

Recent increases in medical imaging, particularly with respect to computed tomography (CT) and other high-dose procedures, have led to a significant increase in individual patient doses and in the collective dose for the population as a whole. Regular assessments of the magnitude and distribution of this large and increasing source of population exposure are therefore crucial. The overall per capita effective dose for all medical imaging (X-rays and nuclear medicine procedures) is about 1.12 mSv. The contribution to the total population dose of different procedures is as follows: CT (57 %), plain radiography (17 %), fluoroscopy (12 %), interventional radiology (9 %), and nuclear medicine (5 %)
[26](#footnote27)
.

Development of imaging technologies has to be followed, in order to ensure the fast deployment of dose limitation devices. The clinical applications of imaging techniques using ionising radiation are very wide. On the other hand, the therapeutic clinical applications of ionising radiation are essentially focused on cancer treatment. Such therapies use high-energy particles or waves, such as X-rays, gamma rays, electron beams or protons, to destroy or damage cancer cells.

In view of the above developments, research challenges for the next 5-10 years must focus on:

-promoting the deployment of dose reduction functionalities in CT and supporting research on evolutionary CT technologies to reduce the dose to patients during CT;

-developing new radioisotopes (other than Mo-99/Tc-99m) for cancer treatment;

-monitoring better the doses received by patients from medical applications; and

-reducing the high variability in radiation doses between hospitals.

Other applications of radiation

Beyond their extensive use in medicine, ionising radiation (IR) technologies are present in a large variety of applications in industry, applied research, agriculture, environment or security, and their beneficial use could be further extended by research, in particular in dose reduction and provision of adequate standards and skilled personnel. The growth potential of new innovative industrial applications based on these IR tools is very large. For instance, nanoparticles (NPs) and nanostructures manufactured with IR tools may be used in a number of areas. Recent advances in particle accelerator technology could be beneficial for many energy and environmental applications, such as treating drinking water, waste water, and sludge, removing pollutants from stack gases, treating medical waste, conducting environmental remediation of hydrocarbon contaminated soil and conversion of fossil fuels. They may also have synergetic effects in other strategic domains (magnetic separation and superconducting technologies) like increasing the capacity of wind generators, enhancing the magnetic separation of material streams, and increasing the efficiency of electrical power transmission
[27](#footnote28)
.

  

c)Waste management

Directive 2011/70/Euratom establishing a Community framework for the responsible and safe management of spent fuel and radioactive waste reaffirms that, ultimately, Member States are responsible for managing the spent fuel and radioactive waste they generate. This includes establishing national policies and implementing them under national programmes. The Directive lays down requirements concerning research as an integral part of their respective national programmes.

The key scientific and technical challenge in radioactive waste management remains the implementation of the disposal options for spent fuel and high-level radioactive waste over a very long time-scale (from hundreds to thousands of years). Research should reduce uncertainties in the safety assessment and demonstration of disposal, and provide analytical tools and methods to deepen understanding of ongoing processes and mechanisms at disposal sites. One important issue around geological disposal is about ensuring appropriate knowledge management and transfer between generations who will be responsible for managing disposal sites.

Research should also address issues concerning the management and disposal of other types of waste and streams, including legacy and pre-conditioned waste, waste from experimental and fuel cycle developments and waste from reactor dismantling, for which no appropriate management and disposal solutions are available. The traditional concepts for research on waste management are also subject to evolution. Waste resulting from accident-tolerant nuclear fuels, developed following the Fukushima accident, and from innovative future reactors present new challenges for disposal which need to be determined and assessed.

d)Decommissioning of nuclear installations

The decommissioning of nuclear power plants will become an increasingly important activity for the European nuclear industry in the coming years, due to the ageing fleet. However, experience in this field is rather limited
[28](#footnote29)
. Ninety power reactors in the EU have been shut down, but only three had been completely decommissioned (all in Germany). The international view does not offer much broader experience: although today 166 reactors are in permanent shutdown mode worldwide, only 13 have been completely decommissioned: in addition to the aforementioned three in Europe, all of the others are in the United States. By 2025, it is estimated
[29](#footnote30)
 that over a third of the EU’s currently operational reactors will be at the end of their lifecycle and in need of shutdown. This equates to 40 additional reactor shutdowns and a total fleet of 130 reactors across the EU undergoing or awaiting decommissioning.

Though various dismantling techniques are already industrially mature, there are still specific challenges regarding achieving high safety levels for dismantling operations. Public research has a potential role to play in supporting safe decommissioning and in reducing the environmental impact of decommissioning.

The EU must be better prepared for the emerging decommissioning market, and for safe dismantling and management of resulting radioactive waste. This requires the development of standardised practices, innovative technologies for waste and site characterisation, and the use of safeguards in nuclear decommissioning. In turn, all of these rely on scientific and technical support. A roadmap for decommissioning research, resulting from a project to be launched under the Euratom work programme for 2018, will provide guidance to stakeholders and the Commission on the steps needed during the next 10-15 years for the development of knowledge on decommissioning and its safety, economic and environmental aspects. It should support future coordination of R&I efforts, which currently tends to be sporadic and overlapping.

e)Nuclear security and safeguards

The main purpose of nuclear safeguards is to assure that nuclear materials are only used for their declared civil use and are not diverted for non-peaceful applications. The detection and the identification of illegally transported or stored nuclear material constitute a major line of defence against illicit trafficking.

According to Chapter 7 of the Euratom Treaty, the European Commission must fulfil its safeguarding obligations, in particular safeguarding existing radioactive materials in the EU and the obligations relating to the non-proliferation of nuclear weapons.

The role of research is to develop and improve analytical techniques and methodologies for safeguarding nuclear materials and to provide operational support to safeguarding authorities
[30](#footnote31)
. Different innovative concepts for safeguards and non-proliferation such as the analysis of nuclear energy systems (safeguards by design, proliferation resistance evaluation, etc.), along with various sources of information, will need to be explored to deal with non-proliferation and security issues in the coming years.

Further research is needed to support nuclear security technologies, above all detection and nuclear forensics, to respond to a nuclear security event and provide substantial training in the field. To prevent the worldwide proliferation of weapons of mass destruction and other sub-national threats, scientific support for the harmonised implementation of trade controls must also be provided.

f)Maintaining nuclear competences and knowledge management

Using of nuclear technologies in all areas of application as well as nuclear safety and security require a highly specialised workforce and preservation of the present knowledge base. Regardless of whether or not new nuclear power plants are built in EU Member States, for several decades there will be an ongoing requirement in the regulatory bodies and the industry to recruit qualified staff. Not only the nuclear power sector, but also those industrial and medical applications making use of ionising radiations, together with fusion energy research, will require highly educated staff with very specific knowledge, skills and competences. The rapid advances in, and growing use of, radiation-based medical imaging are also giving rise to particular concerns regarding the education and training of medical professionals.

The overall workforce situation in the EU (and worldwide) is at risk as highlighted by several reports and studies
[31](#footnote32)
. The challenge arises partly from the age profile of staff in nuclear fields (staff in the 45-65 age bracket account for more than half of the workforce). Because of retirements over the next decade or so — and partly because of a decline in the numbers of students graduating from courses in nuclear science and engineering and filling the vacancies left by retirees — much of the current nuclear knowledge base could be lost
[32](#footnote33)
. This decline is possibly caused by the perceived lack of professional career prospects. It is also becoming increasingly difficult to interest graduates from technical and other studies in taking up a job in the nuclear sector. Moreover, the European sector is rather unattractive for foreign talent, to the development of professional opportunities in nuclear field in other regions.

Knowledge management and knowledge transfer between generations and Member States is essential for maintaining the EU’s high safety standards in all nuclear activities.

g)Fusion energy

EU decarbonisation efforts are currently supported through the development of renewables, improvements in energy efficiency, and use of nuclear fission. In this context, all existing energy sources have their disadvantages and limitations. Use of nuclear fission requires continuous safety improvements, development of radioactive waste disposal and reduction of risks related to nuclear proliferation.

On a longer timescale, fusion energy is a possible new complementary option for low carbon electricity production, which could help address climate change and a growing energy demand. Fusion would be a continuous energy source that does not face the same safety risks, limited waste and proliferation issues as fission, and does not require disproportionate land use. To prepare Europe for fusion deployment, the research and technology development must first demonstrate the scientific and technical feasibility of fusion energy, and then demonstrate its commercial and economic viability. If found to be a viable new energy source, it could contribute significantly to the well-being of future generations. The main impacts of fusion energy deployment could be:

­Improvement of environmental performance of EU energy sector

­Contribution to the mitigation of climate change and to EU energy security

­Improvement of the EU innovation and competitiveness.

Fusion research is a long-term endeavour due to the need to master hot plasmas in large facilities and to develop materials able to withstand very high temperatures and extreme conditions. For this reason, potential deployment of fusion power plants and their contribution to the decarbonisation of the energy mix in Europe cannot be realistically foreseen until the latter part of the century. Fusion could come on line later in the century, as electric power needs are predicted to double between 2050 and 2100. These are all arguments for continuous efforts to demonstrate fusion’s feasibility at industrial level, taking into account that all different energy sources will play a key role in completing a coherent energy-mix for future societal development.

Organisation of fusion research

[33](#footnote34)
[34](#footnote35)
Fusion science and technology has now reached the next stage of development thanks to the successful exploitation of research facilities and progress in the construction of ITER, a research facility under construction in south of France with the aim of demonstrating the scientific and technological feasibility of fusion on Earth as a sustainable energy source. The European Joint Programme (EJP) for fusion research supported by the current 2014-2018 Euratom Programme, which provides 55% of the total funding, plays a crucial role in this process. It is implemented by the EUROfusion consortium, consisting of all national fusion labs and institutes in Europe (under the 2014-18 programme the Commission has a separate contract for the operation of the JET facility which is exploited by EUROfusion). This comprehensive and goal-oriented project covers all aspects needed to realise fusion energy. It includes joint research, use of shared facilities, mobility of researchers, industrial involvement, education and training, international cooperation, etc. The activities of the EUROfusion consortium are focussed on the implementation of the fusion roadmap to fusion electricity, which was approved in 2012 by all European labs as the long-term guiding strategy. After an adoption of the new ITER baseline in 2016, EUROfusion proceeded in 2017 with an update of the roadmap to ensure that it reflects the latest state of play in fusion R&D and that it provides a strategic guidance for the organisation and execution of fusion R&D in Europe.

The establishment of the EUROfusion consortium in 2014 was a key step in this major reorganisation of the fusion research in Europe. The EJP allows considerable flexibility within the consortium to organise and implement research and related activities. The consortium has the complete freedom to allocate the Euratom funding to the beneficiaries according to its own internal procedures. Compared to the fusion research before 2014, the involvement of the Commission’s services is focussed on the broad strategy to achieve fusion as laid out in the roadmap by ensuring that EUROfusion delivers as planned. The Commission pays for the implementation of the roadmap in annual instalments based on the achievement of specified goals in the annual work plans. This should be continued in the next 2021-2025 Euratom progamme to all aspects of the fusion research including the funding and use of all relevant infrastructures.

The fusion roadmap provides a list of 8 R&D missions addressing the main scientific and technical challenges for the realisation of fusion energy. Of these 8 missions, 4 of them require the use of highly specialised research infrastructures in addition to ITER (see table below).

|  |  |  |
| --- | --- | --- |
| Main fusion scientific and technical challenges (research missions) | What is needed to achieve mission? | Infrastructures (existing and future devices which fulfil requirements of the missions) |
| Mission 1 - Plasma regimes of operation: demonstrate plasma scenarios (i.e. ability to manage hot plasma without disruptions) that increase the success margin of ITER and satisfy the requirements of demonstration power plant | Mission 1 will be achieved in ITER. Before start of ITER exploitation, the research programme needs to investigate operating scenarios for ITER and optimise control measures on the basis of similar fuel mix (deuterium and tritium) and with the same combination of plasma facing materials as planned for ITER. | JET [35](#footnote36)  JT-60SA (available from 202X, in Japan)  Different Medium-sized tokamaks (available now) |
| Mission 2 - Heat-exhaust systems: demonstrate a system that can handle the large power leaving ITER and DEMO plasmas. | ITER will test if the existing heat–exhaust system (divertor) will provide a sufficient performance needed for fusion power plant. To address possible risks of lower than expected performance there is a need to develop alternative concepts that require specific infrastructures. | Divertor Testing Facility (planned in Italy by 2023-25) |
| Mission 3 - Neutron tolerant materials: develop materials that withstand the large 14MeV neutron flux for long periods while retaining adequate physical properties. | Currently available plasma facing materials for ITER were developed on the basis of fission neutron irradiation campaigns, not covering fully the temperature and other operational conditions of fusion power plant. A powerful fusion material neutron source with a fusion-like neutron spectrum is mandatory for the validation and qualification of materials for the demonstration power plant, in particular for licensing and regulatory authorities. | IFMIF-DONES (planned in Spain by 2023-2025) |
| Mission 8 - Stellarator: bring the stellarator concept to maturity to determine the feasibility of a stellarator  based power plant. | Further investigation is needed to check if stellarator concept is able to deliver and control high performance plasma. | W-7X stellator (operating since 2016) |

Source: Fusion roadmap

In addition to the missions described in the table above, all research activities are underpinned by the need for a strong numerical modelling. It is therefore important to ensure that the fusion programme embraces developments in computation, especially towards exascale computing
[36](#footnote37)
. This will not only require investment in High Performance Computing hardware, but also a significant evolution in the implementation of numerical models to ensure they work efficiently with exascale computer architectures. The challenge is to adapt the current practises and provide much closer integration of researchers and programming specialists. Furthermore, much greater emphasis on validation of numerical modelling will be required for numerical models to play a role in DEMO development.

The fusion roadmap specifies in detail what input is needed from different research facilities in order to address all missions. In addition, the roadmap lists decisions concerning the use of fusion research facilities according to their impacts on the implementation of the roadmap, especially until ITER comes into operation
[37](#footnote38)
. These decisions are as follows:

-The decision on a possible exploitation of JET after 2020

-The decision on the test facility for alternative tokamak exhaust configurations;

-The decision on the future exploitation of the JT-60SA in Japan;

-The decision on the Early Neutron Source (IFMIF-DONES).

The nature of the involvement of the EUROfusion consortium in each of the above facilities/projects after 2020 should be decided by the consortium on the basis of the scientific and technical knowledge available in order to ensure a successful implementation of the roadmap and the rate of construction of the different facilities where necessary. The role of the Commission services is to provide strategic oversight and ensure that the grant for EUROfusion is used effectively and that EUROfusion reaches subsequent roadmap’s milestones.

Challenges for fusion research

During the 2021-2027 MFF fusion research will face two major research challenges:

-extending the physics/technology basis of ITER relevant fusion science to ensure that future ITER operation will be effective and efficient;

-completing a conceptual design of a demonstration fusion reactor (a DEMO) that generates electricity, and starting transitioning into an engineering design phase of DEMO. 

For future ITER operation to be successful and efficient, it is crucial that the science base is well understood. In particular, the scenarios for operation of ITER should be tested to ensure they are robust and will have a good performance. Potential problems must also be identified and as much as possible addressed before ITER exploitation starts, because it will be much costlier to resolve issues on ITER itself. This will require a broad experimental programme on existing fusion devices, especially those with the greatest ITER relevance, and complemented by an extensive analysis and simulation programme. A potential problem in this respect could be access to devices that in terms of size and components composition are highly ITER relevant.

In order to achieve the goal of completing a pre-conceptual DEMO design and starting the transition to an engineering design phase in the next MFF, the focus of the fusion programme must gradually shift from physics to technology. Consequently, a continuation and even acceleration of the reorientation of the programme towards fusion technology that started during the 2014-18 Euratom programme is necessary. However, changing the composition of researchers in the fusion programme cannot happen overnight, and it will take a sustained effort to redress the balance between physicists and engineers. Furthermore, as the DEMO design becomes increasingly advanced, it will be necessary to involve industry much more than is currently the case. In addition, it is also important to ensure that the engagement of industry participation is at a sufficient level already early on in the next MFF. If not, there is a clear risk that the knowledge of fusion technology now residing within industry due to the ITER construction will be lost before it becomes indispensable for DEMO. Consequently, appropriate mechanisms for greater industry involvement must be put in place for the next MFF.

2.2.Objectives of the Euratom programme for the next MFF

The Euratom programme is established via a Council Regulation setting out the overall objective, overall budget and specific objectives. For each specific objective the Regulation merely outlines the research and training measures eligible for support. The Euratom work programmes for direct and indirect actions, to be adopted by the Commission after consultation with Member States, define the more detailed priorities, budget and instruments to be used. This approach will mean that the programme can be implemented with the flexibility that the new MFF is seeking across the board.

2.2.1.Main objective of the Euratom programme

The programme’s overall objective remains unchanged and is based on the compromise reached unanimously in Council in 2011 following the Fukushima nuclear accident and confirmed recently by the Council’s political agreement on the regulation concerning extension of the 2014-18 programme for 2019-2020. It seeks to ‘pursue nuclear research and training activities to support continuous improvement of nuclear safety, security and radiation protection, and potentially contribute to the long-term decarbonisation of the energy system in a safe, efficient and secure way’. It is implemented through a number of specific objectives setting out detailed research and training activities to be funded by the programme.

2.2.2.Revision of specific objectives and overview of other changes introduced in the future Euratom programme

The programme’s overall scope will remain unchanged, with a focus on:

-
   nuclear safety and security,

-
   radiation protection,

-
   radioactive waste management, and

-
   fusion energy.

To address issues raised by the interim evaluation and by stakeholders, the Commission intends to introduce a number of modifications. The modifications proposed concern the structure of specific objectives, their content, and some implementing provisions (for example on EJPs). It is also important to remember that the Euratom programme complements the Framework Programme for Research and Innovation, sharing with it the horizontal provisions and rules for participation. As a result, modifications introduced to these provisions and rules will be also applicable to the Euratom programme 2021-25.

An overview of all modifications proposed is provided in Table 8.

  

|  |  |  |  |
| --- | --- | --- | --- |
| Table 8 — Modifications from evaluations and stakeholders to address issues | | | |
|  |  |  | |
| Issues |  | Modifications to Euratom programme | |
| Continuation of nuclear research focused on nuclear safety, safeguards, security, radioactive waste management, radiation protection and development of fusion energy |  | Modification of specific objectives | Introduction of a single list of specific objectives for direct and indirect actions    Reduction in the number of specific objectives    Revision of specific objectives for decommissioning and nuclear science and ionising radiation technologies    A revised specific objective for developing expertise and excellence |
| More research on nuclear science and ionising radiation technologies |  |  |  |
| Research to provide solutions for decommissioning of nuclear installations |  |  |  |
| Exploit synergies between direct and indirect actions of the Euratom programme |  |  |  |
| Reinforce education and training actions for developing competencies in nuclear field |  |  |  |
|  |  | Opening ‘Marie Skłodowska-Curie Actions’ up to nuclear researchers | |
| Cross-cutting actions of Euratom programme and Framework Programme for Research and Innov. |  | Legal provisions facilitating cross-cutting actions in the Euratom programme and Framework Programme for Research and Innovation | |
| Support access to and more effective use of research infrastructures for nuclear research |  | Development of legal and administrative mechanisms for the optimal use of Commission research infrastructure through open access    Development of initiatives for networking and sharing of research infrastructures in Europe and for supporting access | |
| Knowledge management activities |  | Reinforced role of the JRC for the management of knowledge produced in the nuclear field. | |
| Improve organisation and management of the European Joint Programmes in nuclear research |  | Amendment of implementing provisions for EJPs | |

Detailed description of changes proposed:

-Structure of specific objectives: a single set of specific objectives for direct and indirect actions is introduced in the basic act. This will allow the Commission, when preparing work programmes, to propose combining instruments such as the Commission’s research infrastructures and JRC’s knowledge base. This approach addresses one of the MFF’s cross-cutting objectives concerning synergies and simplification.

-Revision of specific objectives (see also Table 9):

oReduction in the number of specific objectives from 13 in the 2014-18 programme for both direct and indirect actions to four.

oIntroduction of a specific objective on supporting the policy of the Union on nuclear safety, safeguards and security.

oDefinition of the research support for decommissioning — the revised objective for radioactive waste management covers decommissioning. The scope of the eligible actions includes research activities supporting the development and evaluation of technologies for decommissioning and environmental remediation of nuclear facilities, and sharing best practices and knowledge on decommissioning (current programme contains only a short reference to decommissioning in the safety objective). The focus on decommissioning reflects the early decommissioning demand based on the public interest, the principle of environmental remediation, and the current and future high number of permanently shutdown nuclear reactors.

oRevision of the scope of research for radiation protection — it also aims to contribute to the safe use of the nuclear science and technology applications of ionising radiation, including the secure and safe supply and use of radioisotopes. Medical, industrial, space and research applications are some of the options. Any applications of nuclear science and ionising radiation should be performed based on the general principles of radiation protection as defined in the Basic Safety Standards Directive (2013/56/Euratom).

oSingle specific objective on fusion research to reflect the shift towards the design of future fusion power plants. The new objective for fusion research combines three specific objectives from the current 2014-2018 programme.

oSingle specific objective for all actions necessary for maintaining and further developing expertise and excellence in the EU. It includes education and training actions, support for mobility, access to research infrastructures, technology transfer and knowledge management and dissemination (current programme has separate objectives for these actions).

oSpecific objective on supporting the policy of the Union on nuclear safety, safeguards and security.

-Opening of ‘Marie Skłodowska-Curie Actions’ to nuclear researchers: new provisions proposed for Horizon Europe and Euratom will make nuclear students and researchers eligible for MSCAs. By using a well-established instrument for supporting education and training in Europe the new programme addresses one of the MFF’s cross-cutting objectives concerning synergies between funding instruments.

-Legal provisions facilitating cross-cutting actions in the Euratom programme and in the Horizon Europe Framework Programme: both basic acts will provide for cross-cutting actions, the details of which will be decided in the work programmes in consultation with Member States (see also section 4.1(a)).

-Amendment of implementing provisions for European Joint Programmes in fission and fusion research: improvements will address issues impairing mobility and funding for third parties (see also section 4.1(b)).

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
| Table 9 — Overview of changes in the Euratom programme’s specific objectives  from 2014-2020 to 2021-25 | | | | |
|  |  |  |  |  | |
| Specific objectives for 2014-2020 |  | Specific objectives for 2021-2025 |  | Explanation of changes | |
|  |  |  |  |  | |
| Supporting safe operation of nuclear systems |  | Improving the safe and secure use of nuclear energy and non-power applications of ionising radiation, including nuclear safety, security, safeguards, radiation protection, safe spent fuel, radioactive waste management and decommissioning.  (a) |  | Broader definition of nuclear safety. | |
|  |  | (b) |  |  | |
|  |  | (c) |  |  | |
| Contributing to the development of safe, longer-term solutions for the management of ultimate nuclear waste, including final geological disposal as well as partitioning and transmutation |  | (d) |  | Revised objective covers a broader scope of activities incl. management and transfer of knowledge and decommissioning (covering limited activities in well-defined areas). | |
|  |  | (e) |  |  | |
| Supporting radiation protection and development of medical applications of radiation, including, inter alia, the secure and safe supply and use of radioisotopes |  |  |  | Revised objective covers broader scope of research for nuclear science and ionising radiation technology applications | |
|  |  |  |  |  | |
|  |  |  |  |  | |
|  |  |  |  |  | |
|  |  |  |  |  | |
| Specific objectives for direct actions |  |  |  | Direct actions covered by single set of specific objectives | |
|  |  |  |  |  | |
| Supporting the development and sustainability of nuclear expertise and excellence in the Union |  | Maintaining and further developing expertise and excellence in the Union |  | A single specific objective for education and training covering all actions necessary for maintaining and further developing expertise and excellence in the EU. This includes education and training actions, support for mobility, access to research infrastructures, technology transfer and knowledge management and dissemination | |
| Promoting innovation and industry competitiveness |  |  |  |  | |
| Ensuring availability and use of research infrastructures of pan-European and international relevance |  |  |  |  | |
|  |  |  |  |  | |
| Moving towards demonstration of feasibility of fusion as a power source by exploiting existing and future fusion facilities |  | Fostering the development of fusion energy |  | Three 2014-2020 programme objectives merged into one, with a focus on future fusion power plants | |
| Laying the foundations for future fusion power plants by developing materials, technologies and conceptual design |  |  |  |  | |
| European fusion programme |  |  |  |  | |
|  |  |  |  |  | |
| Policy support provided by direct actions |  | Supporting the policy of the Union on nuclear safety, safeguards and security |  | Provision of policy support is maintained as a separate specific objective | |
|  |  | (f) |  |  | |
|  |  |  |  |  | |

  

-More effective use of research infrastructures, including European Commission’s research infrastructures: the Commission will launch initiatives facilitating mobility, networking and sharing of nuclear research infrastructures to improve education and training impacts and to optimise their use. The JRC could play an active role in enabling EU scientists interested in conducting nuclear safety research to use both its own facilities and those in the Member States, and combine these efforts with indirect actions, which allow for a consistent and sustainable approach.

-Reinforcement of the JRC's role in knowledge management related to nuclear science: Following its 2030 strategy and in order to cope with the specific needs in the nuclear field already described, (paragraph 2.1.2.g) JRC will analyse and communicate in a systematic manner, its own produced knowledge and also the one produced by other sources when appropriate.

-Other changes: in fusion research there will be minor changes to the structure and organisation of the programme. All those involved in fusion research are already embedded in the EUROfusion consortium, and the consortium is an integral part of the global European fusion community. Therefore, it will continue to be the main R&I stakeholder for the implementation of the fusion roadmap’s research plan. It is envisaged that this plan will be a continuation of the current programme. However, it will also include new infrastructures of EU relevance, preparations for ITER operation and the down selection of DEMO technologies for the start of detailed engineering design activities at the end of the programme. However, the Euratom programme 2021-25 should also be seen as a transition towards more industry-led activity and during this period the structure and organisation may further evolve as ITER construction comes to a conclusion and the Fusion for Energy joint undertaking takes more responsibility for the DEMO preparation, in line with its statutes
[38](#footnote39)
. It is therefore proposed to ring-fence resources for the industrial effort, which will be managed separately from the European joint programme, with the industrial services being provided as an in-kind contribution to the EUROfusion consortium.

2.2.3.Success criteria for the Euratom programme 2021-2025

The future programme’s impacts could be measured as follows:

-Use and application of research results from the Euratom -programme by end-users (nuclear regulators, NPP operators, nuclear industry, medical sector). Two yardsticks to measure this could be: (1) the participation of end-users in the projects (for the 2014/15 call the figure was 45-50 % of participants, according to an Ernst & Young study, and (2) a survey on the use of programme outcomes (scientific publications, references materials and measurements, etc.) by end-users.

-Launch of an experimental campaign by ITER supported by the Euratom programme.

-Launch of geological disposal repositories supported by the EJP in radioactive waste management.

-Percentage of EU students in the nuclear field (fission and fusion, all levels) supported by different programme measures (fellowships, PhD funding, mobility etc.).

2.2.4.Implementation of specific objectives

For fusion research, the specific objectives have to be addressed both via the programme structure and priorities, and via the delivery mechanisms

In terms of programme structure it is important for fusion research in Europe that the objectives are implemented through a joint programme to ensure that all the Member States (the smaller ones included) are involved in implementing the European fusion roadmap, with its ultimate aim of producing electricity from fusion energy. This also makes for more broad-based coordination across the fusion community in the European Union and associated countries, providing access to the available infrastructures and enabling researchers to move around. Additionally, it allows for dynamic international cooperation on fusion under the Commission’s strategic leadership of the.

The delivery mechanism for such research is equally important, as it has a leverage effect for the Member States. By contributing 55 % of the total costs Euratom allows the Member States to pool national resources in pursuit of the goals of the fusion roadmap and to become more involved in a Community joint effort. Also, considering that fusion is still in the research phase, it is important that the delivery mechanism is still a grant. The important role of public funding programmes in this endeavour is a reflection of its long-term objectives. Nonetheless, with the success of ITER and the demonstration of the viability of fusion energy at reactor scale, industry will become more involved. Therefore, it will be necessary to reflect on the possible use of other financial instruments — such as loans or equity — that can complement the support offered through grants.

For fission research, the same applies.

In terms of programme structure it is important for fission research in Europe that the objectives are implemented through research and innovation actions and joint programmes to ensure that all the Member States (the smaller ones included) are involved in consensus-building around the nuclear safety objectives in the relevant Directive. This key aspect of fission research should remain a priority in a programme structure defining milestones. This also makes for more broad-based coordination across the fission community in the European Union and associated countries, providing access to the available infrastructures and enabling researchers to move around. Additionally, it allows for dynamic international cooperation on fission under the Commission’s strategic leadership.

The delivery mechanism for such a programme is equally important, as it has a leverage effect for the Member States. By contributing to research in fission Euratom takes advantage of Member States’ experience in the field and helps build an EU safety doctrine aligned with the best Member State know-how. Also, with EU safety objectives being the highest in the world, their practical implementation using the best know-how is of paramount importance. 

The direct actions of the programme, implemented by JRC, include the provision of the scientific basis for Union policies related to nuclear safety, security and safeguards, in full alignment and complementarity with MS national research programme. In fields as nuclear safeguards, the Euratom programme provides technical and scientific support to the Euratom safeguards regime and in the nuclear security field an important part of the activities performed will support the Member States with trainings and exercises. There is also a strong international dimension in the JRC's implementation of the programme, for example with IAEAto take into consideration the global dimension of the nuclear safety, safeguards and security.

2.2.5.Expected impacts of the changes proposed by the future Euratom programme

Implementation of the Euratom programme 2021-25 with the proposed changes will continue delivering impacts in the main research fields as indicated for the baseline scenario (see Table 6). The modifications will bring additional impacts in specific fields as indicated in Table 10 Some changes concerning horizontal aspects of the programme such as education, training and infrastructures will further improve impacts in the main research fields.

|  |  |
| --- | --- |
| Table 10 — Expected impacts of the changes to the future programme | |
| Field | Expected impacts |
| Nuclear science and ionising radiation applications | -Support implementation of the 2018 EU strategy for nuclear science and radiation technology applications (under preparation by DG Energy)  -Support standardisation of health practices involving radiation (reduction of doses for patients and healthcare workforce, etc.)  -Introduce innovative applications of radiation in medical sector  -Support the development of centres of excellence in medical isotopes research  -Use Euratom programme’s actions in nuclear infrastructures to support EU efforts on the supply of medical isotopes (Mo-99, Tc-99)  -Further develop medical applications by resolving issues concerning radioactive waste in the medical sector  -Support the sector via Euratom-funded actions in education and training  -Deliver up-to-date data on the research sector in the field (staff, students, etc.) |
| Education and training                          Knowledge management | -Support PhD students working on subjects related to the fusion roadmap  -Increase the number of researchers and engineers receiving support from the 210 target for 2014-2020  -Support 10 MSCA fellows per year on fusion topics  -Evolve education and training support for the CDA/EDA of DEMO by targeting engineering needs especially as regards nuclear skills  -Guarantee sources of new talent with support for internships, mobility access to infrastructures, etc.  -Support all PhD students working on subjects related to the EJPs in radiation protection and waste management  -Deliver different forms of support (mobility, MSCAs, access to infrastructures) to most students of fission (BSc, PhD, Masters) in the nuclear field in the EU (estimate)    The JRC will further develop knowledge management tools in several fields related to nuclear safety, waste management, safeguards or nuclear security. These will include communities of practice, users networks, etc. |
| Decom-  missioning | Implement the decommissioning roadmap established by Euratom project funded under WP 2018  Provide programme support for sharing of best practices and new solutions applied to all decommissioning projects launched by EC since early 90s  Contribute towards safety improvements, time shortening and cost reduction of dismantling, decommissioning and environmental remediation activities |
| Fusion energy | Provide fusion power plant relevant high-power component technology  Provide facilities for fusion-relevant materials testing.  Ensure science-technology and gender balance in human resources  Increase industry involvement in research activities with the subsequent completion of the DEMO conceptual design  Engage in more productive international collaboration  Undertake a more proactive technology transfer programme with greater associated benefits |
| Research infrastructures | Implement strategy for networking of research reactors in EU  Open access to JRC infrastructures to improve the quality and impact of collaborative projects and training |
| Waste management | Improve management and transfer of knowledge and skills between generations and across national programmes over next 10-15 years |

3.Programme structure and priorities

3.1.Which actions should broadly be prioritised under Euratom programme 2021-25 to meet its specific objectives?

Based on experience from the 2014-2018 Euratom programme, the next research and training programme should maintain the overall priorities of the current programme in terms of support for fission and fusion research, as shown below (Table 11).

|  |  |  |  |
| --- | --- | --- | --- |
| Table 11 — Overall priorities of Euratom Programme 2021-25 | | | |
| Fission research  55 % of the programme | | | Fusion research  45 % of the programme |
| Nuclear safety, safeguards and security | Radioactive waste management | Radiation protection | Research for implementing fusion roadmap |

Such prioritisation is justified by the fact that nuclear research remains instrumental in maintaining the highest standards of safety, security, waste management and non-proliferation, one of the objectives of the Energy Union
[39](#footnote40)
. This is followed by the priority of retaining Europe’s leadership in the nuclear domain in order to reduce energy and technology dependence.

3.1.1.Fission research

In 2021-25 research for nuclear safety will remain a top priority, with particular emphasis on accident management, ageing and long-term operation strategies. Both the ageing of the European nuclear fleet and the additional safety requirements introduced by the Nuclear Safety Directive require increased efforts in developing an understanding of the degradation mechanisms of the safety-relevant components and the impact on safety overall. This would support a science-based assessment of the safety margins and allow for timely implementation of safety improvements. The predictive tools and assessment methods developed by the programme would benefit the periodic safety reviews of existing nuclear installations. They would also help the regulators in assessing new designs.

In line with the interim evaluation findings and stakeholder consultation, the programme will increase emphasis on education and training (E&T), knowledge management, access to infrastructures and nuclear science and radiation technology applications (see Table 12). Another aspect of the next programme that affects all fields is about guaranteeing innovation and ensuring that commercially interesting research results get to market.

|  |  |  |
| --- | --- | --- |
| Table 12 — Priorities of Euratom fission research\* in 2021-2025 | | |
| Priority | Field | Description of priorities |
| 1 | Nuclear safety | Research on safety to accompany the safe long-term operation of the ageing European nuclear fleet. Research supporting compatibility of current and future systems with the requirements of the amended Nuclear Safety Directive |
| 2 | Nuclear security and safeguards | Development of modern nuclear safeguards based on different types of information, trade analysis and multidisciplinary approach. Further development of nuclear detection and forensics and capacity building support |
| 3 | Nuclear standards | Provision of nuclear reference materials, standards and measurements to obtain appropriate and comparable scientific results in every nuclear field. Further development of codes and standards for nuclear safety |
| 4 | Radioactive waste management | Implementation of European Joint Programme in research for radioactive waste management in accordance with the SRA agreed by stakeholders and national authorities |
| 5 | Education, training, knowledge management | Support for: MSCA fellowships for PhD and postdoc researchers; Mobility for students and researchers; Hands-on training via E&T actions within Euratom projects; Implementation of ECVET, accreditation and certification in nuclear professions; Pan-European knowledge-sharing; Management of results of past Euratom projects; More attractive education on ionising radiation and its different applications |
| 6 | Research support for EU policies in nuclear field | Technical support for: monitoring the progress of implementation of the Euratom directives for waste management, nuclear safety and Basic Safety Standards; implementation of EU CBRN Action Plan (COM(2017) 610); nuclear safety outside EU borders through the implementation of the Instrument for Nuclear Safety Cooperation; EEAS on nuclear security and non-proliferation |
| 7 | Fission research infrastructures | Support for: availability and accessibility of key fission research infrastructures; mobility of researchers to access infrastructures; open access to JRC infrastructures |
| 8 | Radiation protection and ionising radiation applications | Implementation of European Joint Programme in radiation protection research integrating low dose biology, epidemiology, dosimetry, radiology, nuclear medicine, radioecology and preparedness to nuclear emergencies. Research for ionising radiation applications in medical field |
| 9 | Research for decommissioning of nuclear installations | Support for the development and evaluation of technologies for decommissioning and environmental remediation of nuclear facilities. Sharing best practices and knowledge on decommissioning |
| \*\_direct and indirect actions combined | | |

   

Should the Euratom funding during the Euratom programme 2021-25 fall below the 2014-2020 level in absolute terms, the key priority objectives would be affected. This would come at a time when nuclear regulators are frequently called on to assess the safety level of the European nuclear fleet, in the light of the new Nuclear Safety Directive, before long-term operation decisions are taken.

Maintaining the level of innovation for safety improvements will depend on the level of resources and stakeholder support, and on the increasing engagement of industry. With strong support above the critical mass — i.e. with resources equal to or greater than those provided in the 2014-18 programme — it is expected that key safety challenges for fission electricity can be appropriately anticipated. The stakeholder consultation points strongly to the need for an increased budget. The nuclear research community declares its readiness to increase its contribution in co-funding of collaborative research and innovation projects, convinced of the urgent need for a larger research portfolio at European level.

With regard to direct actions, the JRC will need to maintain its competences to comply with its mandate in nuclear safety, safeguards and security, and to support the implementation of EU policies in these areas. These competences are currently under high pressure due to staff and budget cuts under the current Programme. More than half of the JRC budget is dedicated to staff costs; therefore a reduction in the budget for direct actions below current levels will have an impact on the renewal of staff and, by extension, on the transfer of skills and knowledge. Secondly, the running costs of the JRC facilities will be also reduced, with the resulting impact on the competences and achievement of objectives.

The JRC currently deals with several aspects of nuclear safety, waste management, radiation protection, safeguards, nuclear security and nuclear standards, among other things. It is in the best interest of Europe to sustain a facility such as the JRC, where a large range of nuclear-related skills is present in-house; some of these competences will even need to be reinforced as there will be an increase in their demand.

3.1.2.Fusion research

The European Joint Programme in fusion research carried out by the named beneficiary, the EUROfusion consortium, should be continued in 2021-2025. The programme of activities should address the priorities set out in the European fusion roadmap. There are several elements in this roadmap, all of which need to be closely integrated, and are outlined below. A pictorial overview is given in Figure 4.

  

|  |
| --- |
| Figure 4 — Overview of the fusion roadmap and role of Euratom programme 2021-2025 |
|  |
| Source: EUROfusion, modified by European Commission |

Since its inception, the fusion roadmap has been the go-to document for aligning the research priorities of European laboratories and universities in the field of fusion research and development towards the ultimate goal of achieving electricity from fusion energy. Key facilities in the roadmap are: the international ITER tokamak, under construction in France, that will demonstrate the scientific feasibility of fusion as an energy source; a fusion neutron source facility for materials development and qualification (DONES); and a DEMO demonstration reactor, which will deliver hundreds of megawatts of electricity to the grid and operate with a closed fuel cycle.

This roadmap is currently being updated by the research stakeholders to take account of the revised ITER baseline
[40](#footnote41)
. However, the general strategy will remain unchanged. The adoption by the European fusion stakeholders of this first update is expected by mid-2018, following the STC review in February 2018. The objectives specified in this update will become the priorities of the Euratom programme 2021-25 as defined in Table 13. As the EUROfusion grant agreement will be the main action for implementing the fusion research activities, the programme must ensure that all the administrative and financial elements are in place to enable EUROfusion to continue in 2021-25 in an efficient and effective manner. In this respect, the conditions for involving industry in the work of EUROfusion are crucial. The participation of industry will be managed through a Commission’s Framework Contract providing efficient and effective access of European industry to the DEMO programme needs. Access to relevant infrastructures of both pan-European and international interest are an essential element of the programme and will be provided through operating contracts under Article 10 of the Euratom Treaty.

|  |  |  |
| --- | --- | --- |
| Table 13 — Priorities of Euratom fusion research in 2021-2025  (main priorities highlighted, not all fusion roadmap’s missions indicated) | | |
| Priority | Field | Description of priorities |
| 1 | Conceptual design of demonstration power plant | Preparation by 2025 of the conceptual design of a demonstration fusion power plant (DEMO, next step after ITER) with emphasis on involvement of European industry and use of its competencies. Closer collaboration with other international DEMO programmes (e.g. the Chinese CFETR) to address common issues identified in the European fusion roadmap. |
| 2 | Materials research | Intensification of materials testing programme using available facilities. Euratom programme will support preparations for the construction of a fusion materials testing facility (IFMIF-DONES), including design, licensing, site preparation, etc. |
| 3 | Heat exhaust | Conducting research (testing of different plasma and divertor configurations) aimed at finding technically achievable solutions for the heat exhaust in a fusion power plant with support for research infrastructures of EU relevance |
| 4 | Preparation for ITER exploitation | Comprehensive experimental programme in facilities of European and international relevance. Continued experimental physics and technology programmes meeting the needs of the ITER project |
| 6 | Stellarator research | Support for research aimed at demonstrating that the stellarator could be a possible option in addition to the tokamak for a future fusion power plant (improving understanding of stellarator physics) |
| 7 | Education and training | Enhance the education and training through further focusing on the human resources’ needs in 2021-2030 (support for Masters, PhD and postdoc programmes, use of MSCA for fostering excellence, further development of engineering skills) |

The EJP in fusion research will be carried out in full complementarity and coordination with the Euratom activities, in support to the construction of ITER and support the Broader Approach managed by DG Energy.

Fusion research relies on the use of large, expensive infrastructures and long-term commitments. A prime example is the construction and exploitation of the ITER facility which will have a lifespan of some 35 years. Should the Euratom funding during the Euratom programme 2021-25 fall below the 2014-2020 level in absolute terms, key priority objectives such as the materials development and risk mitigation experiments for ITER will not be accomplished, thus delaying important objectives and milestones in the overall implementation of the fusion roadmap.

Maintaining the level of ambition and innovation as well as the rate of progress in the implementation of the fusion roadmap will depend on the level of resources and stakeholder support, and on the increasing engagement of industry. With strong support above the critical mass — i.e. with resources equal to or greater than those provided in the 2014-2018 Euratom programme — it is expected that the first fusion electricity can be generated in Europe early in the second half of this century, thus ultimately leading to the introduction of commercial fusion power plants as part of a future sustainable energy mix.

Fusion presents a special opportunity to provide a long-term, robust supply of low-carbon electricity as part of a sustainable energy mix in Europe and worldwide. Fusion distinguishes itself from other low-carbon electricity sources in that it can be an intrinsically safe base-load electricity provider in regions and conditions where this is required, thus eliminating issues of availability of supply and location.

The fusion roadmap outlines the approach chosen by Europe to address the significant remaining scientific, engineering and industrial challenges, many of which have synergies with other science and technology fields. Europe has a leading position in the international fusion research community and has developed expertise in all relevant areas, so is well placed to implement the roadmap. Additionally, Europe is currently developing the necessary industrial expertise to be able to take full advantage of this leadership in terms of know-how, spin-offs and jobs if suitably sustained. Fusion is an international endeavour as exemplified by ITER, and Europe will continue to engage strongly with its international partners.

3.2.Subsidiarity (EU added value/necessity for EU action) and proportionality dimensions of the Euratom programme

The future Euratom programme will be based on Articles 4 and 7 of the Euratom Treaty. According to Article 4 the Commission is responsible for promoting and facilitating nuclear research in the Member States, and for complementing it by carrying out a Community research and training programme. Such programmes are adopted by the Council, acting unanimously on a proposal from the Commission (Article 7 of the Treaty). In addition, Article 8 of the Treaty establishes the Joint Research Centre for implementing research and other tasks, including introducing uniform nuclear terminology and a standard system of measurements.

This proposal is an initiative in an area of shared competence and, therefore, the necessity and EU added value tests of the subsidiarity principle apply.

The European added value of nuclear research is made explicit in the Euratom Treaty itself and the Commission has an obligation to put forward an R&D programme to complement those in Member States. The justification for Euratom intervention is based mainly on the need to ensure high and uniform levels of nuclear safety in Europe. Moreover, in chapter 3 on health and safety, the Treaty also establishes the obligation for Member States to establish provisions on basic safety standards and to monitor the level of radioactivity in the environment on their territory. Through the JRC, the Commission provides standards and technical means to ensure that Member States fulfil their obligations properly.

The Commission, in accordance with the chapter 7 of the Treaty, must fulfil its safeguarding obligations, in particular safeguarding the existing radioactive materials in the EU and the obligations assumed under the non-proliferation treaty. Under the Euratom research and training programme the JRC develops methods, standards and techniques and provides scientific and technical support to other Commission departments.

[41](#footnote42)
The feedback from research stakeholders and end-users of nuclear research such as nuclear regulators, NPP operators, industry and radiation protection authorities shows that the current programme respects the subsidiarity and proportionality principles (see Table 14). Given the similar features and scope, these findings can be extended to the future Euratom programme 2021-2025.

The Euratom programme’s intervention does not replace national R&I actions and does not go beyond what is required to achieve the objectives of the Union. Member States will continue investing in their national research programmes to address specific issues concerning nuclear safety and radiation protection.

|  |  |
| --- | --- |
| Table 14 — Stakeholders and end-users’ views on the EU added value   of the Euratom programme (2017 open public consultation)  (% of ‘agree’ and ‘tend to agree’ answers) | |
| Programme is improving knowledge-sharing and information dissemination | 89 % |
| Programme is mobilising a wider pool of high-level, multidisciplinary skills than is available at national level | 85 % |
| Euratom is undertaking programmes beyond the reach of individual Member States so that objectives that could not otherwise be achieved can be met | 82 % |
| Source: European Commission | |

The main messages from the 2017 public consultation are also confirmed by the results of the survey carried out by Ernst & Young
[42](#footnote43)
 to gauge in more detail the added value provided by Euratom research projects, compared to research conducted at national level or on the basis of bilateral international agreements. The respondents were presented with the opportunity to provide their opinion on several aspects of added value (see Figure 5). The main types of European added value underlined by the respondents are better sharing of knowledge and best practices across borders, the wider dissemination of results allowed by international dimension, greater cross-border collaboration and mobility, and the contribution to the structuring of research. However, the Euratom programme is not seen as exerting a strong influence on the financial aspects of the projects: only 34 % of the respondents agree that the European project provides significant economies of scale and a little under half feel that Euratom funding allows their organisation to secure additional national funding.

Figure 5 — Main types of EU added value of the Euratom programme identified by the respondents to the E&Y survey

![](./../../../resource.html?uri=comnat:SWD_2018_0307_FIN.ENG.xhtml.SWD_2018_0307_FIN_ENG_09004.jpg)

Source: Ernst & Young study

Some respondents also underlined other types of added value. The European programme brings some important nuclear research issues to the European Commission’s attention and enhances the creation of a common vision of research challenges across European organisations. European action is also considered as key in training the next generation of nuclear specialists, through cooperation between educational organisations and with nuclear companies.

This picture of the added value of the Euratom programme is similar to the overview of different aspects of the added value of EU-funded research explained in the Impact Assessment for the Horizon Europe Framework Programme for Research and Innovation. This is especially true as regards strengthening scientific excellence, creating a critical mass of resources to address challenges and building multidisciplinary transnational networks for more impact.

4.Delivery mechanisms

4.1.Main mechanisms to deliver funding under Euratom programme 2021-25

The Euratom programme complements the Horizon Europe Framework Programme’s nuclear research activities and shares the same rules for participation. For this reason, the main features of the delivery mechanism for the Euratom programme 2021-2025 will also be shared with the EU Framework Programme (see Box 1).

  

|  |  |
| --- | --- |
| Box 1 — Delivery mechanism shared with the Horizon Europe Framework Programme  for Research and Innovation | |
| -Strategic programming process  -Single set of rules for participation  -Calls for proposals  -Funding model | -Forms of grants  -Proposal evaluation and selection  -Project management  -Dissemination and exploitation |

For more details on these features and how they will help achieve the MFF’s cross-cutting objectives (simplification, flexibility, coherence, synergies and focus on performance), please refer to the impact assessment for the Horizon Europe Framework Programme.

Taking into account the specifics of the Euratom programme (such as the importance of EJPs, the role of industry and research infrastructures, and the minor role of SMEs), along with the findings of the 2014-2018 Euratom programme’s interim evaluation, some areas for improving delivery mechanisms must be carefully considered post-2020. This is true, in particular, for those areas that will have a strong impact on the cross-cutting objectives of the future MFF:

a)Cross-cutting actions with Horizon Europe Framework Programme

Implementation of some specific objectives of the future Euratom programme may require cross-cutting actions with the Horizon Europe Framework Programme. This may include:

-the specific objective of the Euratom programme 2021-2025 concerning applications of ionising radiation (see section 2.2), which requires cross-cutting actions with the Horizon Europe Framework Programme (health part). Such actions, for example in medical applications of radiation (e.g. brachytherapy
[43](#footnote44)
), may make it possible to address challenging medical and radiation protection aspects at the same time; and

-the specific objective on education and training, which requires cross-cutting actions with the MSCAs in order to make nuclear researchers eligible for MSCA fellowships.

Experience of Horizon 2020 shows that to launch and implement such actions effectively, the following conditions must be met:

-both the legal acts establishing the Euratom and EU research programmes should contain provisions facilitating the establishment of cross-cutting actions;

-these provisions should in particular address issues around the joint financing of such actions and appropriate decision-making involving different programme committees;

-similarly, legal provisions should facilitate the use of the FP’s instruments such as MSCAs with financial contribution from the Euratom programme.

b)Improvements in the use of European Joint Programmes (EJPs) by the Euratom Programme

Under the 2014-2018 Euratom programme, the Euratom funding for EJPs in fission and fusion research accounted for almost a third of the programme’s total budget. It is expected that EJPs established in these areas will continue to play a significant role under the future programme, under specific conditions (see Box 2).

|  |  |
| --- | --- |
| Box 2 — conditions for continuation of funding for EJPs in nuclear research | |
| -Alignment with priorities of the Euratom programme  -Positive evaluation by independent experts following an open call for proposals (fission) and a named beneficiary (fusion)  -Up-to-date joint strategic research agenda or research roadmap agreed by EJP members with research topics assigned priority on the basis of actual scientific and societal challenges  -Open access for all research teams on the basis of scientific excellence | -Implementation of the best practices for internal organisation of EJP consortium  -Involvement of all interested EU Member States or associated countries  -EJP duration of up to 5 years, with possible extension for another two years, if the Euratom programme 2021-2025 is extended  -Level of Euratom funding close to 50 % |

As the rules for participation will set only some general principles for the future partnerships, which include EJPs, it is important to ensure that implementing provisions such as Commission decisions on the model grant agreement and on the work programmes address some issues raised by the interim evaluation
[44](#footnote45)
 and by research stakeholders during the consultation.

The first recommendation referred to the inclusiveness of the European joint programme. The expert group pointed out that even if the level of excellence remains the key for applying for research funding, emerging contributors with the potential to provide new ideas and innovation, should be able to continue and be further encouraged to participate in the joint programme. During the 2014-18 implementation of the fusion programme, this was done via the option of involving different entities as linked third parties. However, this solution was not always adequate, especially for the involvement of industry, because of the requirement to demonstrate the existence of a past legal link with one of the beneficiaries. This requirement was not always fulfilled, resulting in an inability to involve certain industries in the programme as third parties. This weakness of the EJP as regards involving industry was also underlined by the Fusion Industry Innovation Forum (FIIF) and the EUROfusion consortium in their position papers submitted during the stakeholder consultation.

To address this problem it will be necessary to revise the conditions for linked third parties participating in the European Joint Programmes (in fission and fusion research). In particular, entities with no previous link to a beneficiary must be able to become third parties where research cooperation is deemed important. Furthermore, to boost industry involvement in the EU fusion programme, it is desirable to have the option of utilising framework contracts between industrial entities and beneficiaries to provide services to and/or framework partnerships with the consortium. In addition, experience shows that, in many cases, the current rules on depreciation of hardware in the grant agreement impede the procurement of components needed by the joint programme. The next Euratom programme might therefore consider reimbursing the cost of the equipment. Also, it would be beneficial for industry involvement to allow for pre-commercial procurement.

Another recommendation from the group of independent experts for the organisation of the European fusion joint programme, and particularly for the fusion EJP, was to review the system of unit costs. This system has been used for the mobility of researchers and secondment of staff, but has in practice been found not to be well adapted to the evolving needs of EUROfusion. The EUROfusion consortium also raised this point during the stakeholder consultation. A complicating factor in this context is the significant difference in salaries between researchers in the EU-12 Member States and the rest of the European Union. Furthermore, seconded staff with children face additional problems with costs for schools etc. To make it easier to second staff (from all the Member States) to vital functions within EUROfusion, and to improve mobility for researchers, it will be necessary to revise the current system of unit costs. This could be achieved in three ways: firstly, by introducing a ceiling on unit costs for short-term mobility; secondly, by updating the unit costs for education allowances for children so as not to discriminate against researchers with families; and thirdly by extending the use of unit costs for long-term secondments to third countries with which the Euratom fusion programme has specific international collaboration, for instance for European exploitation of the Japanese JT-60SA tokamak.

Concerning better project management within EUROfusion, the group of independent experts suggested firmer arrangements for EUROfusion project management and making the programme manager responsible for the development and implementation strategy. To follow up on this recommendation, it is proposed that the EJP under the Euratom programme 2021-25 should provide a training package on project management. Likewise, following the recommendation from the FIIF in its position paper, the introduction of a Full Lifecycle Cost management (FLCM) method for the estimation the costs of a DEMO could be envisaged.

As demonstrated in the above paragraphs, the operational experience and consultation with the main stakeholders in fusion research has highlighted many areas where improvements are desirable. Consequently, in preparing the implementing provisions for the future Euratom programme these will all be taken into account to ensure effective implementation of the EJPs.

c)Synergies with EU cohesion and structural funds

In 2011 the European Commission approved European Regional Development Fund (ERDF)
[45](#footnote46)
 support funding of EUR 5.5 million for the construction of a new research facility in Řež in the Czech Republic, which now hosts helium and supercritical water research loops. Early 2014, the Czech Republic obtained a further EUR 85 million in ERDF funding (bringing the total to EUR 100 million) for their SUStainable ENergy project (SUSEN). Building such a research infrastructure extends their energy research possibilities, the emphasis being on nuclear technologies at the Řež Research Centre and Pilsen University of West Bohemia. It also allows them to act as a relevant research partner within the Commission’s smart specialisation platforms for energy cooperation, involving the establishment of partnerships and cooperation with other European research centres. All Member States and regions should remain eligible for support from the ERDF, the European Social Fund and the Cohesion Fund to support them in building their research capacity.

  

d)Funding model

The rules for participation, shared with Horizon Europe Framework Programme, will maintain the single reimbursement rate (up to 100 % of eligible costs for Research and Innovation Actions and up to 70 % for Innovation Actions). It will be possible to reduce the funding rate for implementing specific actions, where duly justified in the Euratom work programmes, in particular for research topics involving industry. A flexible funding rate could apply to funding for third parties involved in the EJPs.

5.How will performance be monitored and evaluated?

5.1.Lessons learned from monitoring and evaluation of Euratom Research and Training Programme 2014-2018

In 2014-2018 the Euratom programme shared its monitoring and the evaluation system with the Horizon 2020 Framework Programme for Research and Innovation. As with the latter, the Euratom programme marked a shift in performance measurement, with a set of key performance indicators defined in its legal basis. While the future Euratom programme can usefully take up some of these indicators, the interim evaluation pointed to the need for a more integrated approach to assess the impacts of the whole programme, including direct and indirect actions. Learning from experience, the performance of the future programme will be subject to a single evaluation, monitoring the progress that programme as a whole has made towards its common specific objectives.

In line with changes proposed for the Horizon Europe, it is therefore proposed that performance indicators, to the extent possible, are developed for the entire programme, given the common objectives and interlinkages between the direct and indirect actions. Nevertheless, to define meaningful indicators, it is necessary to keep in mind the specific characteristics of both the direct and indirect actions of the programme and the different way of implementing them to meet the common objectives, and to consider the parts of the programme exclusively dealt with by direct actions.

The selected indicators should allow for a clear attribution of the effects observed to the Euratom programme. The performance framework will also distinguish between progress indicators in the short, medium and long term according to key impacts. With the aim of further simplifying and reducing the administrative burden for participants in indirect actions, better use will be made of existing indicators (e.g. indicators and data used by other EU or national programmes or other external databases), of additional information providers other than beneficiaries (such as project evaluators or reviewers) and of new ICT tools (e.g. standardised IT identifiers of researchers and companies). More automated data collection systems will also make for continued data collection after the project ends, without burdening beneficiaries. The performance framework will be simple and easy to communicate, with a limited number of indicators that a wider audience can understand, and better dissemination and reporting activities.

5.2.Future monitoring and evaluation arrangements

Prior to the 2021-25 Euratom programme’s launch, the baseline data for all performance indicators, mainly on the 2014-2020 programme, will be completed to allow for benchmarking and assessing progress over time.

The future monitoring and evaluation arrangements for the Euratom programme will be shared with the Horizon Europe Framework Programme for Research and Innovation. Implementation data will be available on a dedicated online portal. Every year, the Commission will publish a report analysing progress on key dimensions of the Framework Programme’s and Euratom programme’s implementation. Monitoring arrangements will be put in place to provide an analysis of the effects of the programme. This will include the use of unique identifiers for researchers and companies, allowing for the development of control groups. The monitoring system will be one of the key sources of information for evaluations of the future programme. The CORDA system implemented by the RTD Common Support Centre will continue to be the key repository of monitoring data, as under previous programmes.

Evaluations will provide a robust evidence-based judgment of the performance of the programme based on a wide set of quantitative and qualitative data sources and analytical methods. Evaluations will be based on the Commission’s internal evaluation capacities with the assistance of external contractors or experts. Results from the evaluations will be communicated formally to the other institutions and to the stakeholder community at large, to allow for a broad debate on the issues addressed.

In preparation for the launch of the future programme, an evaluation and monitoring strategy will be developed. This strategy will ensure appropriate and systematic evaluation coverage of the whole programme, with a detailed timetable for specific evaluation work.

-An interim evaluation will be performed no later than 2023 (3 years into the programme
[46](#footnote47)
), according to the evaluation criteria of relevance, coherence, efficiency, effectiveness and EU added value. This evaluation will rely on reports from an independent expert group and the contractors’ evaluation of the specific aspects of the programme. It will also provide a comprehensive overview of the state of implementation and report on the longer-term effects of 2014-2020 Euratom programme. The short-term recommendations for improvements from the interim evaluation will feed into implementation and management over the remaining years of the programme and into preparations for its extension to 2026-27
[47](#footnote48)
. The longer-term recommendations will serve as inputs for the debate on the future Euratom research and training programmes, and will contribute substantially to future ex-ante impact assessments.

-An ex-post evaluation will be carried out in 2029 (two years after the end of the programme) with the same evaluation criteria. It will rely on in-depth evaluations of each area of the programme (fusion energy, nuclear safety, waste management, radiation protection, nuclear security and safeguards), using the same criteria and common templates. It will be prepared starting in 2027 through the performance of a set of dedicated studies.

Networking across the Commission departments involved in the implementation of the Euratom programme, in particular DG Research, the Joint Research Centre and DG Energy is essential to ensure an efficient and coherent evaluation and monitoring. It is equally important to step up the efforts to connect with the programme’s research stakeholders and end-users. The Commission will ensure that appropriate feedback is gathered via surveys, seminars and workshops.

To ensure full transparency in relation to the programme’s performance, a dedicated evaluation and monitoring website for the future Euratom programme and Horizon Europe Framework Programme will present all relevant material and studies performed, following up on the website set up for current Euratom Programme and Horizon 2020.

5.3.Impact indicators 

Progress towards achieving the specific objectives of the Euratom programme will be measured using four impact categories using indicators shared with Framework Programme for Research and Innovation
[48](#footnote49)
.

a)Scientific impacts - the programme is expected to make progress as regards knowledge for reinforcing nuclear safety and security; safe applications of ionising radiation, spent fuel and radioactive waste management; radiation protection; and the development of fusion energy. Progress in this area will be measured by indicators concerning scientific publications, progress in the implementation of the fusion roadmap, development of expertise and skills, access to research infrastructures.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
| Programme’s objective | Short-term indicators  (outputs) | Medium-term indicators  (results) | | Longer-term |
| Improving the safe and secure use of nuclear energy and non-power applications of ionizing radiation, including nuclear safety, security, safeguards, radiation protection, safe spent fuel, radioactive waste management and decommissioning. | Publications –  number of Euratom peer-reviewed scientific publications | Citations -  Field-Weighted Citation Index of Euratom peer-reviewed scientific publications | | World-class science - Number and share of peer reviewed publications from Euratom programme that are core contribution to scientific fields |
|  | Shared knowledge -  Share of research outputs (open data/ publication/ software etc.) shared through open knowledge infrastructures | Knowledge diffusion - Share of open access research outputs actively used/cited | | New collaborations - Share of Euratom beneficiaries having developed new transdisciplinary/ trans-sectoral collaborations with users of their open Euratom R&I outputs |
| Fostering the development of fusion energy | Progress in the implementation of the fusion roadmap –  Percentage of the fusion roadmap’s milestones established for the period 20212025 reached by the Euratom programme | | | |
| Maintaining and further developing expertise and excellence in the Union | Skills -  Number of researchers having benefitted from upskilling activities of the Euratom programme (through training, mobility and access to infrastructures) | Careers -  Number and share of upskilled researchers with more influence in their R&I field | | Working conditions -   Number and share of upskilled researchers with improved working conditions |
|  | The number of researchers having access to research infrastructures through the programme support | | | |
|  | Reference materials delivered and reference measurements incorporated to a library | | Number of international standards modified | |

b)Societal impacts – the programme helps addressing EU policy priorities concerning nuclear safety and security, radiation protection and ionising radiation applications through research and innovation, as shown by the portfolios of projects generating outputs contributing to tackling challenges in these fields. Societal impact is also measured in terms of the developments in the field of nuclear security and safeguards.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
| Programme’s objective | Short-term indicators  (outputs) | | Medium-term indicators  (results) | | | Longer-term |
| Improving the safe and secure use of nuclear energy and non-power applications of ionizing radiation, including nuclear safety, security, safeguards, radiation protection, safe spent fuel, radioactive waste management and decommissioning | Outputs -  Number and share of outputs aimed at addressing specific EU policy priorities | Solutions -  Number and share of innovations and scientific results addressing specific EU policy priorities | | | Benefits -  Aggregated estimated effects from use of Euratom-funded results, on tackling specific EU policy priorities, including contribution to the policy and law-making cycle | |
|  | Number of services delivered in support of safeguards in EU | | | Number of technical systems provided and in use | | |
|  | Number of training sessions delivered to front-line officers | | | | | |

c)Innovation impacts - the programme is expected to deliver innovation impacts supporting delivery of its specific objectives. Progress in this area will be measured by indicators concerning intellectual property rights (IPR), innovative products, methods and processes and their use, along with job creation.

|  |  |  |  |
| --- | --- | --- | --- |
| Programme’s objective | Short-term indicators  (outputs) | Medium-term indicators  (results) | Longer-term |
| Maintaining and further developing expertise and excellence in the Union | Innovative outputs -  Number of innovative products, processes or methods from Euratom programme (by type of innovation) and Intellectual Property Rights (IPR) applications | Innovations -  Number of innovations from the Euratom programme (by type of innovation) including from awarded IPRs | Economic growth -  Creation, growth and market shares of companies having developed Euratom funded innovations |
|  | Supported employment -  Number of FTE jobs created and jobs maintained in beneficiary entities for the Euratom project (by type of job) | Sustained employment -  Increase of FTE jobs in beneficiary entities following Euratom project (by type of job) | Total employment - Number of direct and indirect jobs created or maintained due to diffusion of Euratom results (by type of job) |
|  | Amount of public and private investment mobilised with the initial Euratom investment | Amount of public and private investment mobilised to exploit or scale up Euratom results | EU progress towards 3 % GDP target due to Euratom programme |

d)Policy impact. The Euratom programme provides scientific evidence for policy-making. This in particular concerns scientific support for other Commission services, such as the support to Euratom safeguards, or to the implementation by Member States of nuclear and ionising radiation-related directives
[49](#footnote50)
.

|  |  |  |  |
| --- | --- | --- | --- |
| Programme’s objective | Short-term indicators  (outputs) | Medium-term indicators  (results) | Longer-term |
| Supporting Union policy on nuclear safety, safeguards and security | Policy-relevant findings -   Number of Euratom projects producing policy-relevant findings | Policy maker engagement   Number of Euratom outputs having a demonstrable impact on the EU policy | Policy uptake  Number and share of Euratom projects findings cited in policy/programmatic documents |

Targets will be defined for both indirect and direct actions to reflect the expected results for each part of the programme.

The indicators are complemented by a set of key management indicators to gauge implementation of the programme and monitor the related JRC performance (collaborative partnerships, support for international organisations and participation in JRC-managed networks).Key management and implementation data will be collected for:

·Number of proposals and applications submitted, EC contribution requested and total costs of submitted proposals (by source of funds)

·Number of proposals reaching the quality threshold

·Number of retained proposals

·Success rates of proposals

·EC contribution and total costs of retained proposals (by source of funds)

·Number of participations and single participants

·Number of collaborative projects where JRC participates

·Number of participants and countries in JRC networks

·Number of collaborations with international organisations (IAEA, OECD-NEA, standardisation, etc.)

This information shall be collected according to:

·Types of action

·Types of organisations, including Civil Society Organisations (with specific data for SMEs)

·Countries of applicants and participants (including from associated and third countries)

·Sectors

·Disciplines

Data shall also be monitored on the profiles of beneficiaries and evaluators:

·Gender balance (in projects, in EC advisory groups and evaluators)

·Role(s) in project

·Share of newcomers to the Programme

Data shall also be monitored on the implementation processes:

·Time-to-grant

·Time-to-pay

·Error rate

·Satisfaction rate

·Rate of risk taking

Data shall also be monitored on:

·The financial contribution that is climate-related

·The financial contribution that is sustainability-related

Data shall also be collected on:

·Dissemination of R&I results

·Exploitation of R&I results

·Exploitation and deployment of R&I results

  

Annex 1: Procedural information

1.Lead DG(s), Decide Planning/CWP references

Lead DG: Directorate-General for Research and Innovation (RTD)

Agenda planning number: PLAN/2017/671

2.Organisation and timing

An inter-service steering group (ISSG) on the Euratom research and training programme was set up in 2016. The ISSG is composed of representatives from four Commission Directorates-General (RTD, ENER, JRC, SG). In accordance with the Better Regulation Guidance, the ISSG was involved in drafting an interim evaluation of the Euratom programme 2014-18 and a proposal for the extension of this programme until 2020. Work on input for the impact assessment for the Euratom programme 2021-2025 began during the fourth quarter of 2017. The work was coordinated by the Strategy Unit (G.1) in the Energy Directorate of the Commission’s Directorate-General for Research and Innovation (DG RTD).

3.Consultation of the RSB

The Regulatory Scrutiny Board (RSB) received a draft impact assessment report in March 2018. The RSB’s opinion was adopted on 13 April 2018.

4.Evidence, sources and quality

The impact assessment is based on a wide range of sources. These include:

-internal Commission assessments;

-the input and results from the interim evaluation of the Euratom programme 2014-2018 (external expert group report)
[50](#footnote51)
 and from the Commission’s report (COM(2017) 697) and Staff Working Documents (SWD(2017) 426 and 427);

-the Ernst & Young study on fission and fusion research; and

-the ex-post evaluation of the Euratom 7th Framework Programme (FP7, 2007-2013)
[51](#footnote52)
.

Further evidence was provided by research stakeholders in the consultation carried out in January and February 2018 (for details see Annex 2). The impact assessment’s quality was ensured through a peer review of the report by units from DG RTD, JRC and DG ENER.

  

Annex 2: Stakeholder consultation

As part of the ex-ante impact assessment of the future Euratom Research and Training programme (2021-2025), a targeted consultation, primarily aimed at stakeholders in nuclear research, was carried out. The consultation consisted of three elements: a survey, a seminar and contributions in the form of position papers.

1.Stakeholder survey

An online questionnaire was open for replies from 22 January to 16 February 2018
[52](#footnote53)
. As targeted consultations are not published on the Commission’s page for open public consultations, use was made of the EU Survey tool. Euratom research stakeholders were invited to participate. While the nuclear research community was the primary target audience, the survey was public, with a link provided from the Euratom research webpage.

1.1.Respondents’ profile

In all, 366 people answered the questionnaire, which compares favourably with the total of 323 who participated in the consultation on the interim evaluation of the 2014-2018 programme. More than half (56.1 %) said they were answering ‘in a professional capacity or on behalf of an organisation’, the latter including universities (13.0 %), laboratories (12.5 %) and technical support organisations (7.4 %). The fields of interest
[53](#footnote54)
 and countries of residence of respondents are shown in tables 1 and 2 respectively.

 

1.2.Importance of the present programme

Respondents were asked to rank the programme’s actions in relation to their field of interest and their main reasons for taking part in Euratom projects. The results are shown in tables 3 and 4 below
[54](#footnote55)
.

|  |  |
| --- | --- |
| Table 3. Preferred Euratom programme actions for addressing field of interest | |
| Rank | Options |
| 1st | Provide grants for collaborative research projects |
| 2nd | Support education and training actions |
| 3rd | Support access to research infrastructures |
| 4th | Support networking and preparatory actions |
| 5th | Support mobility of researchers |
| 6th | Support frontier/basic research |
| 7th | Launch European joint programmes coordinating Member States’ research actions |
| 8th | Support dissemination and exploitation of research results |
| 9th | Support innovation (bringing new services and products to market) |

|  |  |
| --- | --- |
| Table 4. Main reasons for taking part in Euratom projects | |
| Rank | Options |
| 1st | Receiving funding for my/our research |
| 2nd | Establishment of research networks |
| 3rd | Access to knowledge and/or nuclear facilities not available or difficult to acquire alone at national level, development of competences |
| 4th | Enhancing critical mass of resources to address specific issues |
| 5th | Credibility of the results obtained in Euratom activities |
| 6th | Industrial competitiveness |

1.3.Directions for the future programme

Respondents were also asked what would happen if they were to receive no funding from the Euratom programme 2021-2025 (they were allowed to give more than one answer). The largest group (65.2 %) said that projects would only be partially implemented, followed by those who said that the project would be funded through national or private funding only (47.6 %) and that the projects would not be implemented at all (43.6 %). The response to other questions on the future direction of the programme can be found in tables 5 to 10 below.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
| Table 5. What should be the role of indirect actions of the Euratom programme? | Strongly agree | Tend to agree | Tend to disagree | Strongly disagree |
| Euratom funding should only focus on a limited number of research areas in order to maximise impacts | 25.95 % | 33.53 % | 31.20 % | 9.33 % |
| Euratom funding should continue to cover the research areas of the current programme | 44.61 % | 42.27 % | 9.91 % | 3.21 % |
| The programme should shift more resources towards addressing basic needs in education and training, mobility, access to infrastructures, knowledge management | 18.26 % | 36.52 % | 32.75 % | 12.46 % |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
| Table 6. What should be the role of the Euratom programme with regard to the access to fission research infrastructures? | Strongly agree | Tend to agree | Tend to disagree | Strongly disagree |
| The Euratom programme should support access to the relevant research infrastructures in Europe | 54.7 % | 38.4 % | 5.7 % | 1.3 % |
| The Euratom programme should support the networking and exchange of researchers between relevant research infrastructures in Europe | 38.6 % | 55.5 % | 5.0 % | 0.9 % |
| The Euratom programme should better facilitate access to the Commission’s research infrastructures | 30.0% | 54.5 % | 13.8 % | 1.7 % |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
| Table 7. What should be the role of the direct actions of the Euratom programme? | Strongly agree | Tend to agree | Tend to disagree | Strongly disagree |
| To provide independent scientific advice in Europe | 42.9 % | 41.3 % | 12.6 % | 3.2 % |
| To carry out research complementing national initiatives | 38.4 % | 48.3 % | 11.3 % | 2.0 % |
| To provide scientific and knowledge support to EU policies | 43.8 % | 49.7 % | 5.3 % | 1.2 % |
| To develop a knowledge management centre for Euratom research | 24.7 % | 48.4 % | 21.1 % | 5.8 % |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
| Table 8. How should JRC direct actions be integrated with indirect actions of the Euratom programme? | Strongly agree | Tend to agree | Tend to disagree | Strongly disagree |
| The JRC should continue participating in Euratom calls for fission proposals on a competitive basis and receive funding as would any other member of a consortium | 14.5 % | 26.8 % | 42.8 % | 16.0 % |
| The JRC should not take part on a competitive basis in Euratom calls for proposals but instead offer in-kind contributions to applicants | 24.6 % | 46.6 % | 21.3 % | 7.5 % |
| The JRC should play a coordinating role in knowledge management | 24.4 % | 55.9 % | 13.0 % | 6.7 % |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
| Table 9. What should be the role of the Euratom programme with regard to decommissioning of nuclear facilities? | Strongly agree | Tend to agree | Tend to disagree | Strongly disagree |
| Support for decommissioning research should play an important and similar role in the Euratom programme as research in safety, waste management and radiation protection | 31.5 % | 25.3 % | 24.0 % | 19.2 % |
| Euratom research on decommissioning should be limited to specific issues such as development of skills and exchange of best practices | 14.6 % | 37.7 % | 40.9 % | 6.8 % |
| Euratom research should support financially industry efforts on decommissioning | 7.1 % | 17.5 % | 26.6 % | 48.7 % |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
| Table 10. To what extent should the Euratom programme be involved in non-energy applications of nuclear science such as medical applications? | Strongly agree | Tend to agree | Tend to disagree | Strongly disagree |
| Research on nuclear science issues for non-energy applications (medical or others) should be supported by the Euratom programme | 22.0 % | 23.6 % | 32.1 % | 22.3 % |
| Research on nuclear science issues for non-energy applications (medical or others) should be supported by other R&D activities (e.g. health) | 36.5 % | 42.0 % | 17.3 % | 4.2 % |
| Research on nuclear science issues for non-energy applications (medical or others) should be supported jointly by the Euratom programme and other R&D activities | 28.8 % | 34.9 % | 17.9 % | 18.3 % |

1.4.Support for innovation

A large majority of respondents (79.9 %) felt that the Euratom programme should support breakthrough innovations in their field. They were then asked to rank-order proposals for how this could be done; the results are shown in Table 11 below.

|  |  |
| --- | --- |
| Table 11. How should the Euratom programme support innovation in your field? | |
| Rank | Options |
| 1st | Support early-stage, science and technology research by consortia exploring novel ideas for radically new future technologies that challenge current paradigms and venture into the unknown |
| 2nd | Support close-to-market projects of consortia of research and industry |
| 3rd | Support the development of European design codes and standards to facilitate deployment of innovation |
| 4th | Support prizes for breakthrough innovation |
| 5th | Support close-to-market and scale-up projects of a single SME or of a consortium of SMEs |
| 6th | Provide loans |

When asked how the Commission should support education and training in fission in the future programme, the options were ranked as shown in Table 12 below.

|  |  |
| --- | --- |
| Table 12. How should the Commission support education and training in fission in the future programme? | |
| Rank | Options |
| 1st | Providing access to research infrastructures |
| 2nd | Providing individual fellowships to postdoc researchers |
| 3rd | Providing individual fellowships to PhD researchers |
| 4th | Supporting short-term exchanges for staff/researchers |
| 5th | Supporting European training networks providing PhD education |
| 6th | Supporting European training networks providing graduate education |
| 7th | Launching specific E&T projects |
| 8th | Dedicating more than 5 % of its financial support for collaborative research projects to education and training actions |
| 9th | Supporting life-long learning in specialist fields by means of (refresher) courses |
| 10th | Supporting individual fellowships for training at the European Commission’s JRC premises |

1.5.Education and training in fusion

The Euratom programme supports education and training in fusion by co-financing PhD studies and EUROfusion grants for researchers and engineers. Respondents were asked to rank possible ways the Commission could support education and training in fusion research for the future Euratom programme.

The most popular reply was ‘Keep existing Euratom fusion E&T programmes’, followed by ‘Expand the existing Euratom fusion E&T programmes’ and ‘Keep existing Euratom fusion E&T programmes and enhance with Marie Skłodowska Curie fellowships’.

2.Stakeholder seminar

On 21 February 2018 the Commission organised a seminar for research stakeholders and representatives from Member States, on ‘Euratom Nuclear Fission Research and Training — What are the new specific needs?’. The following four topics of discussion were selected: ‘Infrastructure Open Access’, along with the closely linked ‘Nuclear Education and Training’, ’Non-Power Nuclear Science Applications’ and ’Innovation in Nuclear Research’.

The seminar highlighted the importance and awareness of available research infrastructures in the EU. In the nuclear safety domain, participants recalled the need for continued know-how on safety improvements of the existing nuclear fleet and anticipation of future nuclear safety challenges. On radiation protection the benefits of bridging research activities in the medical and non-medical sectors were highlighted. On innovation and radioisotope developments the need for a broader approach to neutron-induced transmutation was suggested.

The need for innovation was emphasised to increase safety and make efficiency and competitiveness gains. Euratom was invited to facilitate ‘acceptance’ of new tools, based on new and modern technologies, and to decrease maintenance time and the time taken to build new reactors. The early involvement of the regulator was mentioned, because in the nuclear field not only the TRL counts, but the LRL (Legislation Readiness Level) as well. New technologies (with huge innovation potential) need public support to cross the valley separating research and market. P&T addresses the needs of both industry and society and ADS technology presents a very high potential for innovation.

3.Position papers submitted by stakeholders

Key messages concerning fission research

-The common position of the majority of stakeholders addressed the need to support the implementation of the highest safety and radiation protection standards and the best safety practices in all parts of the nuclear operation lifecycle. Research on further nuclear safety improvements should remain a priority.

-Stakeholders highlighted the positive impact of Euratom programmes and the need for a substantial increase in future Euratom funding to amplify EU R&I impact, to maintain coherence with the ambitious Energy Union objectives, and to maintain EU leadership in nuclear fission in the future. Nuclear research should be included in the ‘Mission Innovation’ intergovernmental initiative.

-Stakeholders proposed a ranking of R&I priorities, assessing the recent outcomes of research projects and taking account of international projects to avoid effort overlaps. Stakeholders stressed the need for further integration in relevant areas of fission research and pointed to the integration and continuation of CONCERT as a way to address the challenges in radiation protection.

-High importance was given to pursuing EU infrastructure development and to support for R&I for advanced systems. Stakeholders also consider it important to promote innovation and give more resources to innovative technologies, in particular to progress in prototype development, demonstrators and innovative processes. The need for public investments was expressed by several stakeholders involved in R&I for future innovative reactor systems; Euratom was invited to continue dedicating resources to this area and support ‘acceptance’ of new tools based on modern technologies.

-Stakeholders also mentioned the importance of nuclear science and ionising radiation technology applications, mainly in the medical sector and for industrial, research and space applications.

-Fostering nuclear science as a basis for supporting standardisation is seen by several stakeholders as an important component of the new Euratom programme. Euratom support would also be beneficial in strengthening the leading role of the EU regarding implementation of nuclear regulation worldwide.

-Research on waste management should be continued through EJP instruments contributing to the development of safe, long-term solutions for the management of ultimate nuclear waste, including final geological disposal.

-Several stakeholders propose the establishment of separate R&D-funding for the decommissioning and environmental remediation of nuclear facilities as well as the development of a coherent strategic research agenda.

-All EU and European Investment Bank financial instruments should be available to the next Euratom programme. Extension of the ERIC scheme to nuclear research infrastructure should ensure the availability of research infrastructure at EU level.

-The fission research community should have access to funding for cross-cutting nuclear fission research projects via the European Research Council (ERC) programme, and to Marie Skłodowska-Curie fellowships for researchers working in nuclear energy. Possible synergies between Euratom and Horizon Europe have to be addressed.

-The next Euratom programme should also propose instruments offering support for proof of concept, technology transfer and spin-off companies.

-The development of international networks with industry involvement and public/private partnerships for the creation of an ‘open access network’ for better use of the available research reactors should also be 'supported.

-The knowledge management and development of competence in nuclear safety and radiation protection are important for the competitiveness of European industry. The Euratom programme should develop activities to promote pan-European knowledge-sharing, including the transfer of knowledge across different fields and generations.

-The European E&T landscape should be further integrated and consolidated. The Euratom programme should continue to support academic curricula and also go beyond traditional paths by combining initiatives in the nuclear and relevant medical and industrial sectors. The programme should also offer more focused and coordinated training and promote life-long learning for specialists by means of dedicated courses. Academia should be better linked/involved with industry and institutions engaged in cutting-edge research. Including E&T activities within collaborative research projects is beneficial and should be continued. Mobility should be further encouraged, within the EU but also with third countries.

-Certain stakeholders mentioned the need to address socially relevant issues with a high impact on Europeans.

-To take stakeholders views into account while preparing work programmes, the following recommendations were made:

·looking at SRAs;

·consulting platforms on a regular basis;

·consulting major operators and national programmes;

·drafting and sending out questionnaires; and

·giving researchers the chance to express their views on an equal footing with industry.

-Greater involvement on the part of all Member States is crucial to the success of the next programme.

-The co-funding rates should be flexible and administrative rules must be simplified.

-The EJP instrument should be improved, based on the lessons learned from CONCERT and could include more amenable procedures for third-party funding.

Key messages concerning fusion research

On fusion, five position papers were submitted in response to the stakeholder consultation (one from the EUROfusion consortium, one from the Fusion Industry Innovation Forum and three from researchers).

The EUROfusion paper concentrates on adjustments to the current implementation of EUROfusion under the EJP grant agreement.

It points out that with EUROfusion and the EJP in 2014-2018 Euratom programme, the coherence and integration of the programme itself, and its focus on delivering a DEMO design, received a significant boost. Furthermore, the conclusion of different reviews (mid-term review, the Ernst & Young management review and the interim evaluation of the Euratom programme in Horizon 2020) state that EUROfusion is fit for purpose.

While ITER remains the critical research device on the road to fusion energy, it is stressed that it is not the only research infrastructure needed. In particular, a fusion-relevant neutron source should be built for qualifying materials for DEMO in a timely fashion. Currently two Member States are interested in hosting the IFMIF-DONES facility and are in touch with the relevant authorities and the Commission.

The position paper lists four issues that affect the scientific/technical implementation of the fusion programme.

1.The main concern is that the funding for fusion in the next Euratom Programme needs to be consistent with the requirements of the fusion roadmap. If the ambitious goals set by the fusion roadmap are to be fulfilled, the funding for fusion research, outside ITER, needs to increase in FP9. On the other hand, it is worth exploring further if the research burden can be shared with international partners in some areas.

2.The second point, strongly linked to the first, merely states that it is crucial for the programme in FP9, especially ITER support, to keep the current fusion devices in the EU in operation, as well as having access to JT60-SA (under construction in Japan in the framework of the Broader Approach). There is no disagreement on the need for operation of a range of devices, but an FP9 review of facilities should be carried out at some point to ensure that the existing suite of facilities is still fit for purpose, any new ones are operating as required and there is no fragmentation of the experimental programme.

3.Education and training is crucial for the future vitality of the fusion programme, and the position paper suggests that this aspect could be improved further if Euratom had access to Marie Skłodowska-Curie Actions. The Commission is already exploring this possibility.

4.The importance of finding a way of keeping the UK in the fusion programme is stressed.

Points related to the grant agreement can be summarised as follows:

·Long-term secondment of staff to vital functions, especially the EUROfusion programme unit, is a significant issue. The differing conditions in the seconded staff’s home countries make the system very uneven, putting staff from the EU-12 Member States at a particular disadvantage. Furthermore, a particular problem presents itself for seconded staff with children, where school fees in many cases can make secondment economically unfeasible.

·Short-term missions supported by unit cost declarations are problematic in some Member States because of domestic rules.

·There is a need for much increased industry involvement in EUROfusion, but the current possibilities under the grant agreement are not well suited for this purpose.

·The rules on depreciation of hardware costs in the grant agreement are perceived to inhibit or complicate procurement of equipment for some of the beneficiaries. One should note that this is a wider issue than for the fusion programme alone.

·The accounting of costs for use of research infrastructures is said to be complex under the grant agreement.

Discussions between EUROfusion and the Commission on the above issues are ongoing, with a view to resolving most of them for FP9.

The position by Dr Fasoli of the Swiss Plasma Centre is a straightforward endorsement of the EUROfusion position paper.

The position of Dr Federici, EUROfusion department Head for Power Plant Physics and Technology, adds to point 1 above in stating that any slippage in the schedule of the roadmap, because of inadequate funding, risks leading to a loss of the expertise built up in the industry and in the fusion community in general in the time gap between ITER and a DEMO. Moreover, because most civilian facilities producing tritium will be retired in a few decades from now, he draws attention to the possibility of a tritium shortage if DEMO is constructed later than currently assumed (tritium is used as a fuel component in a fusion power plant).

The position of Dr Nolte is that there is currently an artificial separation between nuclear data for fission and fusion applications. He therefore suggests the nuclear data could be a subject for a cross-cutting initiative. This is a reasonable proposition and it should be studied further.

The position paper prepared by the Management Board of the Fusion Industry Innovation Forum (FIIF-MB) highlights the desired industrial contribution to the forthcoming DEMO conceptual design phase, which runs in parallel with the next Euratom Programme. Industrial participation is considered essential to successfully realise sustainable and operational fusion power plants as quickly as possible. The FIIF comments and recommendations are in line with the strategy described in the fusion roadmap and are also consistent with the views of the EUROfusion General Assembly.

The FIIF paper further highlights key technical and programmatic industrial activities for three core areas:

Core area 1: Systems engineering/project and programme support and development/technology evaluation, creation of the design platform;

Core area 2: Technology and materials joint development R&D projects;

Core area 3: Front-end engineering and design, including close ‘project management’ support.

Furthermore, a number of recommendations are made in order to facilitate industrial participation:

·A clear industry engagement and contracting strategy with attractive conditions is required. The current practice with the two-stage process for closing contracts between research units and industry is unworkable and the option of a longer-term Framework Contract (FWC) must be considered.

·To support well-defined packages of near-term industry tasks of suitable scope and continuity, there should be a phased long-term plan of increased investment in DEMO and industry involvement.

·Industry-recognised approaches for project execution, including management, risk and cost control in the programme should be adopted.

·Better involvement of industry as a driver to expand the technological direction of ‘fusion education’ should be facilitated.

·Industry should participate in the new bodies foreseen by the revised DEMO project governance.

:   [(1)](#footnoteref2)
     In line with Article 7 of Euratom Treaty the proposal covers 5 years (2021-25). Years 2026 and 2027 will be  covered by a separate proposal.
:   [(2)](#footnoteref3)
       
    <https://ec.europa.eu/commission/sites/beta-political/files/reflection-paper-eu-finances_en.pdf>
    <.>
:   [(3)](#footnoteref4)
     
       COM(2018) 98.
:   [(4)](#footnoteref5)
     
       See Energy Union Package, COM(2015) 80.
:   [(5)](#footnoteref6)
     
       Annex 1 to the Euratom Treaty.
:   [(6)](#footnoteref7)
     
       Pursuant to Article 7 of the Euratom Treaty, Euratom research and training programmes can be adopted for five years.
:   [(7)](#footnoteref8)
     
       COM(2017) 698.
:   [(8)](#footnoteref9)
     
       ITER, meaning ‘the way’ in Latin, is the fusion research facility under construction in southern France as part of a worldwide collaboration.
:   [(9)](#footnoteref10)
     
       Fusion electricity – a roadmap to the realisation of fusion energy (
    <https://www.euro-fusion.org/eurofusion/the-road-to-fusion-electricity/>
    )
:   [(10)](#footnoteref11)
     
       COM(2017) 697.
:   [(11)](#footnoteref12)
     
       See Energy Union Package, COM(2015) 80.
:   [(12)](#footnoteref13)
     
       STC opinion on future Euratom research and training programmes, February 2017.
:   [(13)](#footnoteref14)
     
       For details on the 2017 public consultation see SWD(2017) 427.
:   [(14)](#footnoteref15)
     
       Workshop held on 21 February 2018 in Brussels.
:   [(15)](#footnoteref16)
     
       Funding for indirect actions only. Funding for direct actions is decided in the basic act by the Council
:   [(16)](#footnoteref17)
     
       Research is carried about by JRC institutes in Geel (BE), Karlsruhe (DE), Ispra (IT) and Petten (NL)
:   [(17)](#footnoteref18)
     
       Direct and indirect actions together.
:   [(18)](#footnoteref19)

     
       C(2017) 1288 final, Commission Implementing Decision of 28 February 2017.
:   [(19)](#footnoteref20)

     
       C(2017) 1288 final, ANNEX 1: Key Orientations for the Multi-Annual JRC Work Programme 2017-2018.
:   [(20)](#footnoteref21)
     Demonstration power plant that will generate fusion electricity, the next step after ITER in the Fusion Roadmap
:   [(21)](#footnoteref22)
     
       Council Directive 2014/87/Euratom of 8 July 2014 amending Directive 2009/71/Euratom establishing a Community framework for the nuclear safety of nuclear installations, OJ L 219, 25.7.2014, p. 42–52
:   [(22)](#footnoteref23)

    European Study on Medical, Industrial and Research Applications of Nuclear and Radiation Technology, 2018
:   [(23)](#footnoteref24)
     
    <http://www.er-alliance.org/assets/files/attachments/ALLIANCE%20gap%20analysis_Feb%2020>
    .
:   [(24)](#footnoteref25)
     
       Council Directive (2013/59/Euratom) of 5 December 2013 laying down basic safety standards for protection against the dangers arising from exposure to ionising radiation, and repealing Directives 89/618/Euratom, 90/641/Euratom, 96/29/Euratom, 97/43/Euratom and 2003/122/Euratom.
:   [(25)](#footnoteref26)
     
       Report to the European Commission (SWD(2015) 179) on activities following on from the Council conclusions of 15 December 2009 on the security of supply of radioisotopes for medical use and the Council conclusions of 6 December 2010 and 7 December 2012 entitled ‘Towards the Secure Supply of Radioisotopes for Medical Use in the European Union’.
:   [(26)](#footnoteref27)
     
       RADIATION PROTECTION N° 180, Medical Radiation Exposure of the European Population, European Commission, 2015.
:   [(27)](#footnoteref28)
     European Study on Medical, Industrial and Research Applications of Nuclear and Radiation Technology, 2018
:   [(28)](#footnoteref29)
     
       PINC, SWD(2017) 237 final.
:   [(29)](#footnoteref30)
     
       https://ec.europa.eu/energy/en/topics/nuclear-energy/decommissioning-nuclear-facilities
:   [(30)](#footnoteref31)
     
       JRC research and development in nuclear safeguards, 
    <https://ec.europa.eu/jrc/sites/jrcsh/files/jrc-research-development-nuclear-safeguards.pdf>
    <.>
:   [(31)](#footnoteref32)
     
       
    <http://ehron.jrc.ec.europa.eu/>
    <.>
:   [(32)](#footnoteref33)
     
       Number of students in nuclear fields in EU (2012 EHRON data): ~500 Masters, ~650 Bachelors, ~800 PhD (~100 in fission and ~700 in fusion (2017 data)).
:   [(33)](#footnoteref34)
     
    <https://www.euro-fusion.org/eurofusion/the-road-to-fusion-electricity/>
:   [(34)](#footnoteref35)
     ITER baseline defines scope of the project with regard to performance capabilities, schedule and costs
:   [(35)](#footnoteref36)

    In line with the Commission proposal for extension of the Euratom programme until 2020, the current contract for JET operation will be extended until 2020 when the facility will be handed over to UK.
:   [(36)](#footnoteref37)
     Exascale computing refers to computing systems capable of at least one exaFLOPS, or a 1018 calculations per second
:   [(37)](#footnoteref38)
     See section 10 of the fusion roadmap
:   [(38)](#footnoteref39)
     
       See Article 1(2)(c) of the Council Decision of 27 March 2007 (2007/198/Euratom as amended by Council Decision 2015/224/Euratom) establishing the European Joint Undertaking for ITER and the Development of Fusion Energy and conferring advantages upon it: The tasks of f4E shall be as follows: […] to prepare and coordinate a programme of activities in preparation for the construction of a demonstration fusion reactor and related facilities. Article 3 of the f4E Statutes annexed to the above Council decision states that: In preparation for the construction of a demonstration fusion reactor and related facilities, including the IFMIF, the Joint Undertaking shall prepare and coordinate a programme of research, development and design activities other than ITER and Broader Approach Activities.
:   [(39)](#footnoteref40)
     
       See Energy Union Package, COM(2015)80.
:   [(40)](#footnoteref41)
     
       Commission Communication COM(2017) 319, EU contribution to a reformed ITER project.
:   [(41)](#footnoteref42)
     
       In all, 63 % respondents to the 2017 consultation said that they were ‘end-users’ of Euratom-funded research.
:   [(42)](#footnoteref43)
     
       A total of 589 replies were received from Euratom project coordinators or members of project consortia launched between 2007 and 2015. For more details see Ernst & Young study 2016.
:   [(43)](#footnoteref44)
     
       Treatment for cancer involving inserting radioactive implants directly into the tissue.
:   [(44)](#footnoteref45)
     
       Commission Staff Working Document SWD(2017) 427.
:   [(45)](#footnoteref46)
     
       For more on the ERDF, see 
    <http://ec.europa.eu/regional_policy/en/funding/erdf/>
    <.>
:   [(46)](#footnoteref47)
     
       In accordance with Article 7 of the Euratom Treaty, a Community research programme can be no longer than 5 years in length.
:   [(47)](#footnoteref48)
     
       An extension is necessary to match the duration of the MFF and Horizon Europe Framework Programme for Research and Innovation.
:   [(48)](#footnoteref49)
     
       Unless stated otherwise methodology and data collection will be shared with Horizon Europe Framework Programme for Research and Innovation.
:   [(49)](#footnoteref50)

     
       Council Directive 2014/87/Euratom of 8 July 2014 amending Directive 2009/71/Euratom establishing a Community framework for the nuclear safety of nuclear installations; Council Directive 2011/70/Euratom of 19 July 2011 establishing a Community framework for the responsible and safe management of spent fuel and radioactive waste; and Commission Regulation (Euratom) No 302/2005 of 8 February 2005 on the application of Euratom safeguards.
:   [(50)](#footnoteref51)
     
    <https://ec.europa.eu/research/evaluations/pdf/archive/other_reports_studies_and_documents/panel_report_on_indirect_actions_of_euratom_interim_evaluation_2014-2018.pdf>
    <.>
:   [(51)](#footnoteref52)
     
       Annex to COM(2016) 5 and report from independent experts,
       
      
    <https://ec.europa.eu/research/evaluations/pdf/archive/fp7-ex-post_evaluation/ki0115936enn.pdf>
    <.>
:   [(52)](#footnoteref53)
     
       Targeted consultations are not bound by the same minimum duration requirements as open public consultations. A period of four weeks was considered sufficient for this particular survey.
:   [(53)](#footnoteref54)
     
       Respondents were allowed to indicate more than one field.
:   [(54)](#footnoteref55)
     
       For questions requiring the rank-ordering of a series of options respondents were asked to mark their preferences starting with 1 (highest preference) and continue for as many preferences they liked (2, 3, 4, etc.). Respondents were also allowed to give a preference more than once. Replies were then scored using a Borda count with the formula t-p+1, where t is the number of options and p the preference given for that option.

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