Budget season has begun in Brussels as the European Commission this week proposed its draft plan for 2024’s finances. As things stand, the bloc’s coffers will be provided with €189.3bn to fund its various policies and programmes.
Where research and development is concerned, the Commission has allocated €13.6bn for R&D, with €12.8bn of that due to fuel the flagship Horizon Europe scheme. It marks a €400m increase on 2023 but a couple of caveats undermine that rise in fortunes.
Firstly, inflation means that any real-world increase is severely reduced with some in the European Parliament, which will propose its own financing plan, saying it is actually a cut masquerading as an increase.
Secondly, interest rate hikes mean that the EU will have to allocate more cash for repayments on its €800bn pandemic recovery debt. Initial obligations were forecast at just under €2bn and have now increased to around €4bn.
This is new ground for the Commission, which...