Richard North, 08/03/2005  

For all the posturing on EU defence and despite all the complaining, it still seems as if EU ambitions in the defence and security field could founder from want of that all-important commodity – money. Or maybe not.

Reported today in DefenseNews is a sorry (for some) tale that Europe's defence industry is bracing for cuts to proposed EU defence research funding, which was to reach €1 billion annually by 2007.

It seems that the budget battles with EU member states may force the EU commission to halve its research plans in the next seven-year budget, according to senior EU and defence industry officials in Brussels. The commission may also combine security research funding with space research, which would further reduce the scope of defence projects.

"It’s not looking good," a European defense company executive said. "All the signals of recent weeks point south for the idea."

The commission endorsed the idea of using EU funds for security research a year ago, accepting a commission-sponsored report that proposed annual allocations of €1 billion in 2007, rising to 1.4 billion in 2012 — roughly matching the research effort of the US Department of Homeland Security.

Key areas for exploration include: networked communications, intelligence analysis software, space-based surveillance, and technology to monitor and protect critical infrastructure for airports, communications and energy.

Political support in the EU for security-related research remains high, particularly after the March 2004 terrorist bombings in Madrid, but with Germany, Holland and the UK refusing to agree to larger contributions, the commission his having to cut many budget categories, including security research.

A policy adviser to Gunter Verheugen, the commissioner for Enterprise and Industry, whose department will oversee security research, predicts that security-related project funding will be cut to €400 or 500 million. "But it's still a moving target at this point," he says, as commissioners jockey to preserve their spending priorities.

The situation will become clearer on 6 April, when the commission unveils its draft outline to fund the EU multi-annual research budget for 2007-11 or maybe before then. It can be no surprise that, with political interest so high in the security and defence field, that the commission chose this area to warn of cuts.

This is a well-established pre-budget tactic, as cutting high profile projects is bound to bring squawks of protest and thus increase pressure on the member states to agree a larger budget settlement. Either way, if the EU is going to fulfil its ambitions, member states are going to have to put our money where its mouth is.

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