Discussions regarding the European Union’s next multiannual financial framework for the period 2028–2034 are entering a decisive phase. Among the issues being closely monitored by those involved in research and innovation are the future ‘Horizon Europe’ programme (10th Framework Programme – FP10), which will succeed the current programme, and the new European Competitiveness Fund, which is expected to support the Union’s industrial, technological and strategic priorities. This new fund aims to better link European scientific capabilities, strategic technological priorities and the single market, so that Europe can more effectively transform its research capabilities into economic leadership.
A partial general policy adopted in the spring
In June 2026, the Council adopted a partial general approach on the future regulation governing Horizon Europe and the European Competitiveness Fund, which will serve as the basis for negotiations with the European Parliament and the Commission. This enables Member States to agree on the programme’s key principles (objectives, structure, priorities, types of actions) whilst leaving aside those elements still subject to budgetary negotiations, in particular the financial amounts.
A budgetary situation that is becoming clearer
The common negotiating basis presented by the Cypriot Presidency of the Council represents an important step: it provides Member States with a figure to work with as they continue discussions on the future European budget. The challenge is to strike a balance between European ambition, budgetary sustainability and the ability to fund major shared priorities. In this context, Horizon Europe and the European Competitiveness Fund appear to be two key instruments for strengthening Europe’s position in global competition.
Discussions are currently taking place within the Council regarding the budget allocation for research and innovation programmes. The European Commission’s initial proposal of €175 billion has been scaled back by the Cypriot Presidency (by 4 per cent) for Horizon Europe, the European Competitiveness Fund and the Erasmus+ programme. The European Parliament is pushing for a much more ambitious budget of €200 billion but is facing opposition from the major net contributors (Germany, the Netherlands, Austria, Sweden, Finland and Denmark), who are calling for an overall reduction in the European budget.
An architectural framework inspired by the Draghi and Letta reports
This new framework builds on the Draghi and Letta reports, which have significantly shaped the European Commission’s thinking. The Draghi report provided a clear analysis of Europe’s lag in productivity, innovation and investment in strategic technologies. The Letta report, for its part, called for the deepening of the single market, in particular by making research, innovation and education a genuine ‘fifth freedom’. These two contributions have inspired the Commission’s approach to preparing the future FP10 and the European Competitiveness Fund: to better link scientific excellence, the internal market, strategic investment and industrial deployment.
A stronger link between scientific excellence and competitiveness
The Council has confirmed a partial position on Horizon Europe 2028–2034, reaffirming the framework programme’s central role in supporting scientific excellence, collaborative innovation and responses to major societal challenges. The future Horizon Europe programme should, however, adopt a more integrated approach, aligned with the Union’s competitiveness priorities. The aim is to facilitate the transition from research to demonstration, industrialisation and market launch. Discussions are, however, still ongoing regarding the independence of Horizon Europe, to ensure that it is not subordinate to the European Competitiveness Fund, so that fundamental research does not depend on industrial policy.
Decisions still to be made
However, several issues remain at the heart of the negotiations. The governance of the programme and the link between Horizon Europe and the European Competitiveness Fund, the balance between fundamental research and strategic priorities, the role of European partnerships and dual-use applications will be the subject of in-depth discussions between the Council, the European Parliament and the Commission. For the research and innovation communities, one of the key challenges will be to uphold the core principles of Horizon Europe: excellence, openness, cooperation and impact.
What are the challenges facing those involved in research and innovation?
Stakeholders in the ecosystem will need to monitor these negotiations closely. A Horizon Europe programme that is more closely linked to the European Competitiveness Fund could open up new avenues towards industrial deployment and European value chains. Care must, however, be taken to ensure that this focus does not diminish the role of fundamental research, collaborative research and projects driven by scientific and societal needs.
What are the next steps?
With Ireland holding the Presidency of the Council of the European Union until the end of 2026, discussions are expected to enter a more political phase, particularly with new budget proposals due in the autumn. The vote on the Ehler report in the Committee on Industry, Research and Energy (ITRE), followed by its adoption in the European Parliament’s plenary session, is expected in the autumn, paving the way for trilogues with the Council and the Commission. The Lithuanian Presidency is then expected to continue negotiations in the first half of 2027, with the aim of finalising the remaining points by mid-2027, so that the first calls for proposals can be launched in early 2028.
At Euronovia, we are closely monitoring the progress of these negotiations to help European research and innovation stakeholders anticipate future funding programmes, identify emerging opportunities and prepare their positioning strategies. To stay informed about the next steps regarding FP10, the future European Competitiveness Fund and the next Multiannual Financial Framework (MFF), follow Euronovia on LinkedIn!