Funding for the UK’s future association to Horizon Europe is “fairly secure” but must be discussed again ahead of this year’s spending review, meaning the government cannot guarantee to every researcher that their projects will be “funded indefinitely”, according to the business secretary.
Kwasi Kwarteng was speaking during an appearance before the House of Lords’ Science and Technology Committee in a hearing on government research and development funding.
The hearing came after a last-minute settlement was reached between the Department for Business, Energy and Industrial Strategy (BEIS) and the Treasury on the likely £1 billion cost of associating to the EU’s Horizon Europe research programme, and after cuts to Official Development Assistance (ODA) funding hit research projects.
Mr Kwarteng, secretary of state for BEIS, said that “in terms of Horizon funding, I think it’s fairly secure. That’s part of my job to try and secure that funding. We’ve already had some success, because there was a contention that…BEIS would absorb the entirety of the Horizon subscription, costs of association, in its own budget. We managed to avoid that. We’ve had very cooperative, collaborative conversations with the Treasury on this.
“As you will know, we will have to do the same thing ahead of the spending review this year.”
Asked about the breakdown of funding for Horizon association agreed this year, Mr Kwarteng said there would be £400 million in “redirected money” from the existing BEIS budget, an “extra £250 million in the pot”, with the remaining £350 million “as I understand it, part of the government’s contribution – and it’s going to be accounted for in the BEIS budget”.
On that £350 million, he said the government “had made provisions as to what would happen if we didn’t associate…and we’ve got resources and that plugs the gap”.
Mr Kwarteng said the context of the spending review this year “will be very different” from last year’s as it will come with Horizon association already agreed. Last year’s spending review took place before association was agreed.
Asked by Labour peer Lord Mitchell what assurances he could give to researchers on Horizon funding beyond the first year “so they can continue their projects”, Mr Kwarteng replied that “the assurance I’m giving is that the R&D budget is increasing”, with the government’s pledge for that to reach 2.4 per cent of gross domestic product by 2027 a “cast iron” one.
He continued: “What I can’t do is essentially anticipate the spending review of 2021 or write the budget for 2021-22 or 2022-23…What I can’t do in this committee is give a guarantee to every researcher in this country that their particular projects will be funded indefinitely.”
Meanwhile, the decision to cut ODA spending across government from 0.7 per cent of GDP to 0.5 per cent of GDP, combined with a big fall in GDP in the wake of the pandemic, had led to a 35 per cent cut which has had “disproportionate effect on particular research projects”, Mr Kwarteng said.
The impact of ODA cuts in research was “regrettable”, but if the government returns to a 0.7 per cent of GDP spending figure in future, and when GDP recovers, “I think we can get back to a much healthier position”, he added.
On medical research charities, whose income from charitable donations has been hit badly in the pandemic, Mr Kwarteng said that while he could not promise the government would fill the whole gap, “what I am saying is we will try to mitigate some of that”.
Mr Kwarteng also said the government’s innovation strategy was scheduled for publication in June. It will succeed the industrial strategy, recently abandoned by the government, which was “too broad and it wasn’t focused enough”, he added.
