Committee on Industry, Research and Energy Ordinary meeting
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ITRE European Parliament
Follow its sittingsSpeaker 2
I also propose a reformed governance for Pillar Two. The commission left unanswered how our reformed Pillar two would actually improve the quality of R and I it funds. We know from Heitel, the report from Draghi, and the work of Professor Aguillon that while public authorities should define priorities, detailed implementation should be left to the self-governance of the field. Furthermore, agility does not mean budget flexibility to shift money between political priorities, as the commission proposes. Agility means ensuring calls and projects are at the frontier of science and technology.
This means calls need to be developed and launched quickly, and that projects need to be able to change direction when needed. That is why I propose an expert-led governance for Pillar two, allowing us to set political priorities, put sectors in the lead, offer predictability while maintaining agility, and focus on topics with real European added value. Dear colleagues, this is a defining moment for the Framework program and for Europe. In a world shaped by great power technology rivalry, a European continent at war, and an unprecedented pace of technology change, only uncompromising excellence will secure Europe's competitiveness, security, and prosperity. Good is no longer good enough.
Commissioner Sarajevo's proposal opened the door to reform. This draft report sets out how to walk through it, and I look forward working with you and to with all of you, as I did already before, with the commission and the council and with the stakeholders community to build an ambitious, agile, truly world leading horizon in Europe. It's really time to act. It's not a generic development of something. We need to be faster, better, quicker, but we also need to be predictable for all stakeholders.
Thank you very much.
Stéphane Séjourné
Thank you, Mr. Boudka. And now the floor is for Ms. Lina Galvez, for two minutes.
Speaker 3
Thank you, chair. First of all, I want to acknowledge the constructive work done with the rapporteur. Thank you very much. And, also to insist that we agree on a fundamental principle, which is that FPTEM must be the engine of Europe's future, and a coherent link with the European competitive net fund will give a needed boost for our competitiveness in these very difficult times, because I agree as well, it is time to act. For that, we welcome the clear separation of programming between Horizon Europe and the European Competitiveness Fund.
And it is vital that collaborative R and I remain governed by its own dedicated committee to protect its unique intervention logic. Regarding the budget, we will resist any attempt to reallocate R and I funds to non-research priorities. We will insist on maintaining the level of ambition needed to implement a program that is truly fit for the future. We also support the strengthening of the ERC, EIC and Marie Slodowska Curie options without any directionality, as their autonomy is the pillar of our scientific excellence. That means that excellence has not to be linked to the reality of those who produce it.
For that, we need to improve working conditions, provide sustainable careers, especially for early career researchers, and decrease the gender gap. We cannot talk about competitiveness while our best talent faces chronic precariousness, and while we still lose so much female talent. Our political priorities, we also focus on strengthening social and gender conditionality. Gender equality and the do not significant harm principle are European values that ensure our knowledge and innovation is ethical and inclusive. We want to highlight that Horizon must remain a civilian program.
We need to clearly distinguish dual-use from defense. Any defense-related projects with military applications must be funded through dedicated instruments like ECF, not at the expense of civil research. And finally, we must bridge the gap. We need to reinforce the role of R and I in promoting regional competitiveness and territorial cohesion. We will include stronger links with the regional innovation ecosystems and SMEs.
In conclusion, we won a program that helps our competitiveness, well-being, social justice, and transparency. We look forward to the negotiations, and thank you very much once more to the rapporteur.
Thanks. I will speak in French.
Speaker 6
First of all, thank you very much, particularly for the work that you've done. And we can see that the text is clearly moving forward on the most important points. And we've had these exchanges, which have allowed us to see things more clearly. We've done some work on clarification, sorry. Could you speak a little bit more slowly?
You've done the clarification work that the commission hadn't done on the APA on governance, on comitology, and on the work that's been done between the commission and the council in its execution. On research, we very much appreciate the reinforcement of the European research independence and the link between collaborative research and the European funds of competitiveness, which is made clearer. The efforts for simplification should also be underlined. Participants of the program should be able to benefit from an easier administrative burden and simplified access to financing. I do, however, have a question on the new instrument that you're introducing.
Speaker 5
What do you mean by the Fast Track to Excellence provision, Fast Track to Innovation provision, and the European Demonstrator Scheme? We would like you to take some time to speak with the shadow reporters so that you can explain to us exactly what your vision is for this. And Mr. Ehler, after these compliments, let me move on now to a reservation that we have on the threatened researchers' notion, because we think that it's not a very specific reference of the text. We know that European universities have been weakened.
And so we think that we need to make sure that the words that we use are legally specific, and that everybody understands exactly what we're talking about.
Anna Zalewska
me start by saying thank you to the rapporteur. Commission proposals are not always clear, not always understandable. If we want to talk about spending large sums of money, and we want to have strict criteria and determined criteria, and we want to see clear results. And if we want that to guarantee stability among all those working in the field of innovation, then this is something we really need. So I agree with the repertoire that we have a lot of work to do, but I think we have to be more demanding of the commission.
The repertoire, together with us, mentions this fact from the very beginning. I have the impression that the commission wants us to do everything all by ourselves, and the commission will only say if it's okay or not okay, they will maybe accept or not accept our work, which should not be the case. It should be the other way around. When it comes to the ECR, we can agree with most of the report, especially when it comes to the funding, increasing to €20,000,000,000, and establishing the budgetary goal for a wider participation. We welcome the approach to simplification, especially the more flexible lump sums.
That's a key thing, especially for smaller entities. I think the rapporteur will not be surprised to hear that there are things we think should be amended. We will table our amendments. So there are some divergences. The first thing is about the conditionality of the funds and the wider participation.
We disagree that this funding should not be available after 2030. It should not be a link between this and national input contribution into science. We think this provision should be deleted. We especially in the context of geopolitical tensions and this expenditure on defense, this is not a good idea in this context. So we need to highlight that member states should fully participate in the programming of defense and technology and dual use.
We cannot accept a model in which executive agencies take key operational competencies on behalf of member states and capital. So I think we have a good starting point, and we are happy to cooperate, but we will not stop asking the commission to start working harder.
Speaker 9
Yes. Thank you very much, madam chair. And, dear members, I warmly welcome the draft report presented today by colleague Christian Ehler. It has addressed the concerns raised by stakeholders with considerable care, and has struck the right balance between competing interests. I'm confident it will serve as a solid foundation as work towards the adoption of the final report.
Ivars Ijabs
Allow me to highlight what I consider the most significant question before us, and this is the relationship between Horizon Europe and the European Competitiveness Fund. The European Union has long stood at the forefront of global research, in no small part thanks to the previous framework programs. When we speak of European competitiveness, we must be clear that this can't mean subordinating one financial instrument to another. The commission is right that the aligned policy and the aligned synergies between the two programs are essential, but this alignment is achievable through other means. Shared policy windows with distinct work programs and separate cometology structures will allow our researchers to deliver groundbreaking technologies while remaining fully in step with our industrial and scaling ambitions.
In that sense, I'm also pleased that our report has chosen to retain the commission's proposal on the widening instrument, which has already been mentioned. Whatever controversy surrounds it, I firmly believe that the commission has found the right balance, and this will be a right way to go and the sound basis for the negotiations ahead. I equally welcome the proposed shift towards more expert-driven governance through decided councils. While questions of conflict of interest among the experts involved will need to be addressed carefully, without any doubt, placing those at the frontier of knowledge at the center of governance is, in my view, essential. Finally, and this should not be understated, I strongly support the provisions for button-up initiatives.
We must trust our researchers' capacity to anticipate future trends. This is not a risk to be managed. It is a strategic choice to remain at the global forefront. Our amendments will concentrate on forward priorities. We, where we believe the report can be further strengthened, research security, international cooperation, simplification, and horizontal instruments.
Thank you very much for reporting to her, and thank you for your attention.
Stéphane Séjourné
Thank you, Karek. Now it's the turn of the Greens, and BR for the Greens, Mr. Ville Niinistö.
Speaker 10
Dear chair, dear colleagues, I would like to start by thanking Doctor Ehler for this ambitious draft. It contains important telecom improvements that we strongly support, so this is a move to the right direction. So it's a good start for our work in the parliament. In particular, we strongly support the significant increase budget. It's important that we commit ourselves to that as parliament as a whole.
There is a clear commitment to excellence. There is a stronger autonomy of the framework program in relationship with the ECF. There is improved predictability and quality in the rules of the program, and there is also strengthened autonomy of the ERC. However, also, there are some elements that raise question marks, so I will take up a few of those, which we will then consider in the process of further negotiations. First, on governance.
The proposed expert-led implementation, as my colleague from Brinue said as well, has a risk also for creating a closed system. We strongly support the autonomy where it belongs, in frontier research and, in general, in research or scientific autonomy in general. But extending self-governance to Pillar two, which is closely linked to industrial and economic interest, is a more complex matter, and we have to make sure that calls are effectively designed in a way that they do not weaken the excellence of the program itself by actually institutionalizing gatekeeping and vested interest. So we have to be careful of what we mean by expert-led implementation. Second, on dual use and defense research, there is a more distinct approach here that the funding for defense should come from the ECF, but we maintain the position that Horizon Europe as a whole should preserve its civilian nature across all components, including the EIC.
And we think that it's important to fund defense, but that should be done fully and transparently through ECF and not through the specific program. And then also, we find it problematic to downgrade the EU missions and include new instruments. Researchers at risk is something we support, but there's also a number of other instruments here that are creating fragmentation and complexity. In the future process, we will table amendments to make sure that the program fully addresses key societal challenges, particularly climate and environment, to strengthen interdisciplinarity and ecosystem approach and include the role of social sciences and humanities. We look forward to constructive and good cooperation to make sure that FP10 remains a truly European program, open, excellent, and aligned with our long-term public interest, and also to raise the level of European research globally.
Thank you very much.
Stéphane Séjourné
Thank you, Kalek. Now for KHTI, three Kaleks has asked the floor. So the first is Christophe Clanjou. The floor is yours for one minute.
Christophe Clergeau
Thank you, chair. So first, I would like to thank Christian Ella for his report and to underline the importance of having a specific approach of Horizon Europe distinct from ECF and simultaneously building these pathways from research to innovation from the whole program. When we are talking about pathways, we also need to take into account some very important transversal issues. Personally, I am keen on health and ocean issues. So I will try to propose some elements in the ECF.
Stéphane Séjourné
There's a problem with your microphone. So it seems to be open, but it doesn't work. So if you can change it. I give you one more time. Is a photo on the left, I suppose.
Christophe Clergeau
Does it work? Yes. Now it works again. Okay. So I will just, and I will conclude by that, referring to the missions because I think perhaps it's necessary to amend what other mission, to adjust their functioning, to clarify what is about research, what is about delivering solutions and scale up of solutions.
But we are exactly at the moment when we are beginning to deliver solutions, and I think they need more time to show their full potential and to really bring to Europe some key elements. And last but not least, I would like to underline what Nina Galvez said about the regional and territorial dimension of research and innovation. Excellence is also rooted in regional ecosystems, and we have to find a good balance between more top-down and bottom-up approach. Thank you.
Stéphane Séjourné
Thank you for the colleague. And now the floor is for Eszla Lakos from the EPP on behalf of the EPP.
Speaker 19
Grazie, and thank you also to the rapporteur for your constructive work with us and also for taking the initiative to shake off the collaborative research part of the program. Both are very timely and much needed. I would like to focus on the priority setting in my remarks. I completely agree with you, with the expert at governance of Pillar two, and also that the ECF and Horizon Europe both should have their own governance structures. And this is really essential that we ensure a general coordination of the priorities, and establish the practical links between the two programs.
Speaker 14
I also fully support your proposal on the expert-led implementation, but we should build in guarantees in the system to avoid that the same experts set the priorities. They select the peers, draft the course, etc., so that we avoid the risk of structural bias. And I would, you know, just suggest you discuss some elements, that's composition of the council, the program committee procedure, the timeline for the efficient establishment of such councils. And maybe to put on the table, eventually, to reflect on the role of the strategic plan, which could be an overarching framework that could help to ensure that the program is driven by clear priorities so that we have predictability for researchers and the industry. To conclude, I believe that we share the same objective to design the framework program that truly works for its beneficiaries.
Speaker 15
This means ensuring simplicity, clarity, balance, and predictability. At least, we are going to come, of course, with amendments. We were focused on several aspects on widening dual use, international collaboration slash association, innovation ecosystems, and on the EIT, and I look forward to working with you on the next steps. Thank you.
Davor Ivo Stier
Yeah. Thank you, chair, and let me also thank the rapporteur for a good, very well-balanced draft. I would like to focus also on the widening category and aspects of the new Horizon program. Let me say that for countries like mine, Croatia, it has been transformative. It's been strengthening research capacity, boosting participation, and accelerating our convergence with the European research area.
So we fully support the continuation of the widening package in the next program, and we are glad to see that the rapporteur also welcomes widening in the draft report. We need a framework, indeed, that is predictable, fair, and genuinely inclusive. So we must ensure clarity and predictability in the governance of widening. I mean, indicators for progress might, must be transparent, measurable, stable over time because frequent reclassification of countries could risk undermining long term investments and participation. Therefore, let me conclude that a stronger, a very well-balanced program, obviously, will benefit not only the widening countries, but the union as a whole.
Thank you.
Stéphane Séjourné
Thank you. So any other colleagues has asked for the catch up? Yeah. And now I give the floor to the rapporteur of the opinion. And the first is committee budget, Susan Singer.
The floor is yours.
Speaker 17
Thank you. Thank you, Cher, and the dear rapporteur, Christian Heller, dear colleagues. The committee on budgets will provide the budgetary assessment, as you already know, on the proposal for the regulation establishing Horizon Europe. Our focus is the financial and the budgetary aspects of the proposal, and to maintain a close cooperation between our two committees to ensure a strong common position. First, regarding the overall amount proposed for Horizon Europe, we consider that it should be increased.
Speaker 20
I repeat, it should be increased to ensure the European economy the needed innovation boost. We are waiting for the final decision on the MFF interim report that will set parliament's position on the increased amounts for each program. Second, I would like to express our concern with the lack of a predictable budget for many actions and the lack of a detailed budgetary nomenclature as proposed by the commission. This will hamper oversight and predictability for finance final beneficiaries. It also reduces the budgetary authorities' ability to steer accurately policy priorities in the annual budgetary procedure.
Speaker 17
Third, although I recognize that flexibility is an important feature of the commission proposal and a necessity for a research and innovation program, there is also the need to ensure predictable and sufficient annual resources for the Horizon Europe program considering the long term nature of financing projects. A proper balance between predictability and flexibility could be achieved by setting an indicative budget reallocation for each item of the program. This would ensure predictability for final beneficiaries without depriving the budgetary authority of its prerogatives. Fourth and the last, I consider that all research commitments should be fully reused to help strengthen the union's research capacity without artificially capping the amounts. Furthermore, in my perspective, the reflow from financial instruments funded by the Horizon Europe program should stay available within this program.
It's clear these two very important positions. I mean, the commitments and the reflows. In conclusion, I want to express that I remain fully available to work in close proximity with you and to ensure total alignment between the legislative and budgetary aspects of the proposal, guaranteeing a strong and united position of the parliament for the future negotiations with the council. Thank you very much, and congratulations to the rapporteur. Thank you.
Stéphane Séjourné
Thank you, dear colleague. And now the floor is for Regi Serban Storza.
Şerban Dimitrie Sturdza
Thank you, chair. I'll speak in Romanian. Stimas College.
Dear colleagues, as rapporteur for the Reggie Committee on this opinion, I would like to point out that Horizon is not just a research program. This is a strategic instrument for the competitiveness of Europe and for our capacity to react to the great economic and geopolitical challenges we are facing. At the same time, the Reggie opinion completes the landscape with something important. That is the territory. It is clear.
Excellence should be the basis of this program, but it cannot be sustainable if it focuses only and remains limited to a few centers of innovation. In order to be competitive on the long term, we need conditions so that innovation is generated, taken up, and turned to account in all regions of the EU. That is why we stress place-based innovation and the role of local and regional actors, universities, SMEs, public authorities and other local actors as important and essential in transforming research into real economic impact. Another very important element of our opinion is that we should have good conditions to develop competitive innovation ecosystems. The link to the cohesion policy is very important here.
Horizon finances excellence, and the cohesion policy finances the opportunity to use this excellence in the economy. Without this, we could limit the impact of our investments. At the same time, we want a more realistic and nuanced interpretation of the widening concept. We need to take into account differences not only between member states, but also between regions as well. And we also stress the need to reduce red tape and to simplify.
We need easier access to the program, especially for first-time beneficiaries, SMEs, local universities, and local actors in the field of research and innovation. More flexible consortiums will allow for wider participation without compromising excellence. We have €175,000,000,000 potentially at our disposal, but these investments should reach all the regions of the EU, not just a few centers, a few innovation centers. Only this way, Horizon can be an innovation engine for all the regions because it would mean not only excellence, but also real impact on the economy and inclusion. Thank you.
Stéphane Séjourné
There you go. Now for the commission, agree, Berthian Riesen. The floor is yours.
Good
Bert-Jan Ruissen
Morning. Good afternoon. And we've spoken several times about the farming aspects so that we can really have this fitting into Horizon Europe. Now the project, the project that we are looking at today, I have to say that I'm quite disappointed with the weight of farming within this proposal. The proposal from the commission farming is mentioned, yes, but the report is basically getting rid of references to farmers in the text and replacing them with other priorities, something that I think is a very dangerous way of working.
And so I'm just raising this here today, because I do think it's worrying. No. It's not just personally, but on behalf of the AGRI committee, there's a great agreement on this, and we want to ensure that in Horizon, farming is explicitly mentioned and that a budget that is fitting for agriculture is reserved for it, because the farming policy and farming in general is being pushed out by other priorities, and this is something that we can't allow. Farming is of great importance, vital importance, and should be one of our strategic priorities in Horizon. We've got discussions about food security, climate change in Horizon, and we've needed this to face a whole range of challenges.
And so once again, I would call upon the reporter to have a look at this issue and the reference that is made in the agri draft. Now, of course, the commission's opinion, the agri committee's opinion is available. You can have a look at that. But we do most certainly need to make sure that there is a place for agriculture on the horizon. And as it's presented in the current text, that's just not acceptable to us.
Stéphane Séjourné
You are very precise in the time. Thank you. The last committee opinion given is a cult. Laurence Farreng.
Speaker 22
Thank you, chair. Now I switch to French, please. So.
As you said, I'm speaking for the court committee as rep of the court committee for the opinion. And this is a cultural heritage. Now, the amount of money that's being set out for 2020 up to 2030 is double the current envelope. And Horizon is setting out an important ambition to respond to the priorities that are identified by the Commission. Now we've got three main messages to pass on, and they're reflected in the compromise amendments that were voted on.
The first one is on higher education. There should be a partner. Excellence in the area of research is done in universities, and Horizon needs to guarantee all of these spaces alongside the industry in the private sector. And so it should be better taken into account in the third pillar. And then, cultural and creative industries are essential for our sovereignty.
Technology developed for and by our cultural industries is a strategic pillar of our strategic autonomy in Europe. And Horizon should take this into account, particularly in the area of technological innovation. So we'd like to see a part of the second pillar being focused on in this area. And finally, the European universities' alliances should be recognized. These alliances are considered to be beneficial to Horizon, and they won't be if we don't recognize the criteria of excellence in the programs by giving them funds.
And so we need to make sure that the value added and the previous alliances are recognized in the selection processes. This is particularly important for the fourth pillar. And so these aren't secondary concerns. These are really at the heart of what we have in our European industry to make it competitive and sovereign. So I want to make sure that I can work together in a constructive way with the rapporteur, and I will.
Speaker 28
And I'd like to thank the rapporteur for his work, and I would like to make sure that our priorities are reflected in the final text. Thank you very much. We
Stéphane Séjourné
have finished, and we have now the oh, yes, please. Thank you. It's not finished. We have the important president of the director general in DG Research and Innovation for three minutes. Mister LeMarc Lemaitre, the floor is yours.
Very far.
Speaker 27
Yes. Madam chair, honorable members, thank you very much for this opportunity to discuss Mr. Ehle's draft report. I wish to start by thanking you, Mister Ehle, for defending an ambitious approach to our future framework program, not only regarding its budget, but also its aim to place research and innovation at the heart of our economy. Your report makes interesting suggestions that we will further analyze. But for the sake of time, let me focus today on the main challenges that we identified.
First, on the simplification. While we agree, I'm sure, on the goal, there remain divergences on the means to reach that goal. Reproducing the current horizon setup will not tackle complexity. The budgetary distribution you propose is very detailed and inflexible. On single funding rates and lump sums, we tested them extensively.
Stakeholders confirmed their success and real contribution to the simplification. So while lump sums should become, in our view, the default option, we do recognize that in justified cases, actual costs should be applied, and we are happy to discuss this further. Finally, horizontal provisions like environment and gender should remain in the performance regulation, not be added differently to each program. Second, on governance. We propose to tightly link FP 10 with the competitiveness fund to promote and support the innovation to investment journey.
Undoing the link will compromise this. The integration of the competitiveness part of pillar two into the competitiveness fund's work programs will ensure a strong dedicated R and I component without subordination and common priorities for formerly 15 different programs. These priorities will be set via the steering mechanism with full parliamentary involvement. Regarding concrete programming, experts will be involved at multiple stages via the Observatory of Emerging Technologies, the Strategic Stakeholders Board, and thematic platforms. This is why we view critically your suggested expert-led councils.
We find them adding more complexity, heaviness, and costly coordination while undermining commission implementation prerogatives and financial accountability. This said, we acknowledge the need for further clarity and discussions, and we will provide in the coming weeks a detailed fish on governance and the innovation to investment journey to feed reflections. On delegated acts for work programs, we consider this legally problematic under the Lisbon Treaty. Third, regarding the European Research Council and the European Innovation Council, we are exploring your suggestions. On the length of the ERC president's term, the aim is not to weaken independence, but to avoid tenures longer than the MFF itself.
I will address ERC independence more broadly under the specific program. For defense-related funding, we are unsure what its full placement under the competitiveness fund would mean for the ERC EIC architecture, but we are ready to explore this. Finally, on partnerships and missions. Partnerships are key tools for collaborative research. They should contribute to the competitiveness fund's objectives with their size defined strategically.
Also here, we need simplification. This is why we propose making work program partnerships the default and treaty-based partnerships the exception, because treaty-based partnerships are administratively and legally more complex. On missions, our proposal is to confirm and anchor their envisaged R and I end date in 2030. We believe this is the right way to reap the fruits of the mission-driven investments made until now. I will leave it at this for now, although there is, of course, much more to discuss, and I look forward to our future exchanges.
Thank you very much.
Stéphane Séjourné
Thank you very much for your present and your speech. And now for final remarks to the rapporteur, Mr. Allard. The floor is yours.
Speaker 2
So thank you very much. And first of all, you know I'm German, and we tend to not tend to any kind of European politeness, but I would really like to thank for the cooperation. And I really would like to reassure you that we take all the opinions and everything very seriously. But where's the starting point for that? Whatever ambition we have on agriculture, on culture and whatever, if we don't have a clearly defined second pillar, whatever verbal reassurance you get, it's not going to happen for sure.
So the first step is simply that we want to define what is the core of the research program. That's the second pillar. And from there, derives all pleas for, as we rightly have been saying, and I have no intention to exclude agriculture nor in its dimensional importance. But if you don't have a clearly defined agriculture, how would you define the agriculture budget? Same with the cultural issues.
It's really dear to my heart. I mean, we had been referring to the CCCs and the importance of that, and so on. So we had that in the program no longer because the second pillar is no longer there, and it will be temp depend on the governance in on the ECF, whether the issues are in or out, where we even haven't defined in that governance of the ECF what are the priorities, what is actually competitiveness, and things like that. So in a way, I think the central, and I see us united on that, is that we clearly have to define what is the framework program, what parts are inherent in the framework program, what budget has the framework program, and from where derives the work. One more particular question.
On the fast track of innovation, which had been asked, I think, from one of the colleagues, this is an instrument, which could, on the one hand, serve the widening and on the other hand, serve the very fact that we have it takes endless from working program to calls at average more than 1.5 years. And usually, we have relatively big calls with big consortia, a lot of participants. To keep that small, to have a dedicated instrument which is permanently open is addressing in the widening the fact that you have in a lot of widening countries pockets of excellence, which might be addressed in the first year, then addressed in the third year. So if you have an instrument which is dedicated to smaller consortia, that is beneficial, I think, for the widening countries. But it's also beneficial for all the pleas where we had been saying on quantum, on AI, we are far too slow.
It takes too long. Two years, I mean, that is ages in AI and quantum. So in a way, we need a kind of accelerator instrument, small calls, not so big consortia, budget, but being quick. That is simply an instrument to accelerate things. Then on the question on the link to the structural funds, I mean, obviously, but we have to, and I think in general terms on the widening, we agreed that we want to have a inning.
It's common ground. There are some questions to be answered. One is, how do we properly use the structural funds in connection with the framework program? We had a seal of excellence, but very few countries had been using the structural funds to use the seal of excellence. Of all, Spain had been the ones who had been using that the most.
So we have to find a link. Then on the questions on excellence, not excellence, obviously, we need dedicated instruments, a discussion which is just we want to have a percentage. You know? I think we are not going to succeed in that. We have to answer questions, what do we do and how we accelerate the way out of the widening program.
So is it beneficial to be a transition country, or is it just beneficial if you stay like this? So in a way, I think I trust, and I'm going to invite all of you to have a common discussion on that, although it's not a question that we will have a widening component. On the expert-led question, I mean, I do believe and I do understand to some extent that the commission is getting nervous. But what is the intention? Not to invent the world for you.
It's, first of all, teams, not just one expert, and not that we want to have biased industry research or whatever. I think it's Teams. We know these programs. It's not completely new. Our competitors are doing that.
We are doing that in the EIC. We refer permanently to the DARPA program in The United States. We're reflecting DARPA models and so. But if we do, we get completely nervous. You know?
How could it be? So in a way, the calls still need to be discussed with the councils overseeing their work. The call commission can still change the text. The member states can vote to call a text down. But we should be aware if we're addressing now the situation in the digital field, in these most ambitious, most advanced fields, it doesn't work that we do working programs which take two years from consideration to calls.
That doesn't work for AI. It doesn't work for quantum. It doesn't work for a lot of sectors which are dynamic. We can't reflect with a very static procedure. I don't question the principal ability of the commission to lead the structure, to set priorities.
But if what had been the midterm review, the stakeholders said the calls are inconcise. They're vague. We have big calls, a lot of consortia. So we have to become better, and we shouldn't be nervous. We don't want to enable the to disarm the commission.
We simply have to reflect that in the rest of the world, it's done quicker, faster, expert-driven. So we want to give it more in the hands of experts, but that's how the commission actually started.
Colleague, may I ask?
Speaker 2
If I may say so, I think everything I heard, we can integrate in this process. But we have to have a united position in the parliament because what is unacceptable is that the core of the program is not clearly defined. It's decided by a third party. We don't know about that. A process we don't understand, and the commission can't explain.
And I think that should be the point where we unite. It should be more agile, predictable, and it should be good legislation. Thank you very much.
Stéphane Séjourné
Thank you. You will have the time, sure, because we just have an information for all the colleagues. The deadline for tabling amendment is 09/2026 at noon. You will have the time also to discuss every amendment. Thank you for the attention, and we go on with the follow item.
Establishing the specific program implementing Horizon Europe, the framework program for research and innovation for the period of 2028, 2034, laying down the rules for participation and dissemination under that program. And we have about 1 hour for this debate on the specific program implementing Horizon Europe. The rapporteur, mister Repazi, will present the draft report in four minutes. And after all, I will invite the shadows to take the floor two minutes each, and we will continue with catch the eye one minute each. I invite all the members who wanted to take the floor and, you know, to put your name.
So, Mr. Chastel is unfortunately unable to attend. Time permitting, I will give the floor to the commission representative, the director general of research and innovation. Mr. Repazi, the floor is yours for 4 minutes.
Speaker 30
Thank you, madam chair. Now this is going to be a very different debate than the one that we just have heard. Obviously, the specific program and the framework regulation are interlinked. So I'm afraid it's going to be repetitive. But this is, of course, also with added value in a sense that the difference between the framework regulation, the specific program from parliament's perspective is in the one council and commission has to take us seriously.
Speaker 29
In the other, they are only waiting for us to have voted, and afterwards, they can forget our suggestions. And that makes it that the close cooperation between our negotiation team and Christian Ehlers' negotiation team is here crucial. So, therefore, also, we are going to treat both as a package. And also, at the end of the entire process, once our negotiation team have concluded on compromise amendments that find sufficient majority in Itre, we will decide on those parts of the specific program that we will move into the framework regulation in order to have it treated under the ordinary legislative procedure. And that there's also agreement between the rapporteurs that the specific program in the negotiations, in the trial log, has to be dealt with as if it were an ordinary legislative procedure.
Speaker 31
The one is intrinsically linked to the other, and the difference in terms of legal base is legal high acrobatics in order to distinguish the scope from one to the other. And therefore, it makes it very clear that from our perspective, those elements that are highly political actually belong to the ordinary legislative procedure, although for the time being, they are dealt with in the specific program. And that does indeed relate to the elements that were also addressed in the draft report. One of the core changes, and it was also already echoed in the previous debate, is on the role, the autonomy of the European Research Council. This is one of the most valuable bodies that we have in the European Union as worldwide, its expertise and its ability to select proper and high-level research projects is recognized.
Speaker 29
And this cut doesn't come out of the blue. It has something to do with ERC's autonomy with the very fact that its governance structures are within the limits of being a specific body as it is designed autonomous from the European Commission. And the attempts that we can see in the draft of the specific program to undermine ERC's autonomy are ones that cannot be supported by this house. And therefore, also the draft report is reinstating the autonomy of the ERC as it existed. At some elements, the report is even amplifying and strengthening the ERC's autonomy, giving it a political mandate as we want to hear what the scientists being active there have to tell us as the legislator on how a proper research policy should look like.
And in the review clause, we even suggest that the European Commission should seriously consider the establishment of a proper union agency for the ERC. Obviously, the same structure has to apply to the EIC as the idea is that both councils ensure the excellency, the expert-led and expert-driven processes to select, to award, and to manage the program. Excellency is therefore also in this draft report the core selection criterion that we suggest for the specific program. That comes back to certain elements of the amendments the draft report includes. First of all, we suggest very concretely, and by that, maybe even overstepping the mandate a legislator has, that the ERC should apply anonymized selection procedures where the ERC panels simply look at research proposals without any further reference to the person of the applicant that has submitted a proposal.
Moreover, we think that the excellency should not only be part of the selection process, but already start earlier in the idea of the strategic programming process. In that regard, the draft report makes a proposal for the creation of a so-called sectoral plan, which is inspired by the Dutch sector plan. And that leads to a collaborative research instrument where research institutions of a specific sector are invited to already develop a program that is leveling up an entire sector, and that is making use of the ERC's expert left and expertise, experience, and expert network in order to ensure that this sort of program can actually work. Finally, for the amendments, we are also considering to table an amendment on what the council in its version of the 03/2025 has introduced: Article 17b, strategic priority process, where we do see also an added value of having expert bodies and expertise already included in such strategic priority process. As a final note, we consider the Marie Curie action program as of utmost importance in order to support, in particular, early-stage researchers.
So we want to strengthen it, giving it its own working program and include very strong employment conditions, as this is of utmost importance for early stage researchers. Thanks a lot for the attention, and I'm now looking forward to the exchange of today's debate.
Stéphane Séjourné
Thank you. And now the chateau operator for two minutes each for EPP, mister Eske Estecar Lacos.
What.
a big mistake
For me. Sorry. Sorry.
Speaker 14
No. No. Thank you, Mipiripassi, for your draft report. And let me express firstly on the strategy as per the explanatory note. I agree with you that all those provisions that exceed the implementation so that they belong to the structure that should be regulated in the FP.
Therefore, I support your suggestion to move parts related to the ERC, EIC and the partnerships to the regulation. I also very much welcome your commitment to enhance the autonomy of the ERC and the importance of the ERC. At the same time, I see the introduction of a new instrument for sector-specific collaborative research in the form of sector plans that should be further discussed. I mean, I understand that the inspiration was drawn from the Drag report, and you have also mentioned the successful Dutch experience. But I think careful consideration has to be done, and further discussion should be on this.
It is a new dimension of the work of the ERC, and I have to admit to you that I have some intellectual difficulties in seeing this as a proposal that reinforces the autonomy of the ERC. In addition, it raises important questions not only about the potential impact, but also about the additional funding and the human resources that would be needed to implement this proposal effectively. The EIC appears to be following a very similar trajectory, so its role should be further strengthened. And, of course, if we are to grant greater autonomy, that should also go hand in hand with greater responsibility and accountability. And, of course, this goes also hand in hand with the ERC.
Your report pays significant attention to the ERC and the EIC, but the collaborative dimension, the very heart of the framework program, has largely been overlooked. And the collaborative parts should be at the center in the framework program, and these are those instruments that are sitting here that they foster cross-border scientific excellence, multidisciplinary research, but also international collaboration. So here, we also have complex social challenges. We should further boost this text, I believe. In addition, I believe that more focus should be given to the innovation ecosystem and the integrated knowledge triangle.
To conclude on a positive note, I welcome the references to widening participation and closing the divide in research and innovation performance across the union. On the other hand, I believe that more ambition is needed in the text to ensure greater balance, geographical diversity, and attention to the newcomers. We have a political responsibility to ensure that convergence and innovation remain a guiding principle of the program and that balanced representations of member states beyond simply diversity of regions are ensured in the governance structures, expert groups, and advisory bodies. So I look forward to working with you on this file, and thank you for the draft.
Stéphane Séjourné
Thank you, colleague. And once more, excuse me for the mistake. Now the floor is on behalf of the Patriots. Madame Julie. Thanks.
Speaker 6
Repassy, your report represents significant headway over the commission's original proposal. In governance, you will allow the program to be better guided. And the European Research Council on Collaborative Research as well ensures the independence of the framework program in terms of the future fund. And you focus on criteria of excellence, which will support the effectiveness of the program, and particularly in terms of strengthening the democratic governance of this program. Looking at the initial text, I was rather concerned about the lack of involvement of the Council and Parliament in the follow-up evaluation and checks on the implementation of this policy.
And we now have certain reservations we'd like to raise, which for us are genuine red lines. When we hear ideas such as diversity, equality, inclusion, we simply have to think of the disorder we're seeing on American campuses. Recent experience shows that policies conducted under that banner have seriously destabilized the university systems that have applied it. Claiming to promote academic freedom, you run the risk of undermining the scientific basis within universities. As rapporteur, it's your duty to protect a research environment in higher education based on objectivity and the excellence of scientific work.
So we hope that you will have the courage to put aside ideological approaches, which would aggravate the situation in European universities. We still have time to do that, and I hope that we will. Thank you.
Thank you. I speak Polish.
Anna Zalewska
Thank you.
reporter. This report goes hand in hand with my group's vision of the Horizon Europe program. We are satisfied with the proposal to extend the mandate of the chair of the European board for research to four years. We think that the stability of governance is the key thing to implement long-term strategies.
Okay. It's a.
Stéphane Séjourné
It's a question. Okay. But I give you much time if you want. Okay. Doesn't matter.
Okay.
Anna Zalewska
Even though we find a lot of positive elements, we want to show where we see divergences that are for our group especially important. So, first of all, geographical balance. This is something we will keep highlighting and stressing. Lack of geographical balance exacerbates the geographical gap. We need to support technologies and regions, but we cannot allow a concentration of funds in the strongest regions.
So we need that program to have strong and strict regulations for geographical balance and not just very general provisions on combating talent gap in the brain drain. When it comes to the infrastructure, we suggest that the rule should be more precise when it comes to cofinancing of new infrastructures and the percentage cap on cofinancing. In the current draft report, this is not included. So this is a step forward. The report is a step forward, but we need to complement it with the mechanisms that will guarantee that Europe, that European Union, will become a union for everybody and not just the wealthy.
Thank you.
Stéphane Séjourné
Thank you, colleague. And now on behalf of Renew, Miss Katri Kulmouni.
Speaker 34
Yes. Thank you, madam chair. And, dear colleagues, thank you for miss Reparci for your draft report. Your overall approach is very supportive. It's easy for us to support the draft idea as such.
Of course, I have some remarks, but in general terms, we were very pleased with that. I will calm the reporters' emphasis on clarifying the specific program strictly implementing the role. So the framework program sets the vision, while the specific program then must execute it without reinterpretation. And this distinction is critical for clarity, especially in relation to the European Competitiveness Fund. I support the report strengthening of the autonomy for the ERC and EIC.
The ERC's global reputation is built on independence, excellence, and a bottom-up approach. Moreover, transparency in work programs with indicated timetables and budget allocations is a practical necessity. And researchers and innovators, especially small and medium size, need clarity to plan and compete. I also welcome the focus on research security in the work programs, and we must protect our research ecosystems while preserving openness. The idea of assessing the feasibility of the ERC as an independent agency is interesting, but we need to have the budgetary implications and impact analysis clearly outlined.
And what we must reflect further on, though, is the directionality in the Maris Kludovska Kure actions. While the MSCA is one of our most successful and popular instruments, any changes on that should be considered well and to be minimal, I'd say. Finally, while expert-led implementation is innovative, we must guard against conflicts of interest, especially when experts come from the same institutions as beneficiaries. So I look forward to working together in the coming months. So that's all about me.
Thanks.
Stéphane Séjourné
Thank you, colleague. And at least on behalf of the Greens, Mr. Will Niinistö.
Speaker 10
Dear chair, dear colleagues, I would also like to thank Professor Doctor Repassi for his excellent work on the draft reports. Have to also, your academic claim has to be recognized here as well. So I think this is a very good start because it makes restores clinical clarity and institutional coherence in the architecture of the program, and the specific program must remain what the treaty intends it to be, an implementing act, not a parallel place for strategic decisions. That is why we support the approach of bringing key provisions on governance, work programs, key parties back into the framework program where they belong. This is not a technical issue.
It's an issue of democratic accountability. A program of this scale must remain open, competitive, and accountable. Secondly, we strongly support the clear separation between research and innovation policy and broader industrial deployment instruments. Horizon Europe must remain focused on its core mission, supporting excellence, collaboration, and knowledge creation, especially in areas where market incentives are weakest. Thirdly, we also welcome the strong emphasis on Europe's research base and talent pipeline.
The flagship programs, the Mariku Reactions and the European Research Council, are our strategic assets in global competition for talent. However, we also have some questions about the ERC sectoral plans idea. We should be wary of introducing a new layer of complexity of overlapping structures. In our amendments, we will further strengthen the report by adding elements on social sciences and humanities integration, climate and environment mainstreaming, and clarifying the civilian focus of the program. We look forward to working together to ensure Horizon Europe remains excellence-based, open, and impactful.
Thank you very much.
Stéphane Séjourné
Thank you, colleague. Now for the I have just one colleague that asked, Evostir. PPP. He'll okay. Evostir renounce to the okay.
Good. So we have the time for the. The floor is.
Speaker 27
Honorable members. Thank you for your efforts on this report and for the opportunity to provide the first comments. First, on governance and structure, I already mentioned our strong concerns regarding a loosening of the link between Horizon Europe and the Competitiveness Fund, as well as the setting up of two new expert-led councils. Let me also firmly argue against transferring provisions from the specific program to Horizon Europe. What we proposed as in previous framework programs is fully in line with what the treaty says, I.
E, that the specific program shall define the detailed rules for implementing the framework program. Second, let me come back to the European Research Council and the European Innovation Council. We consider your proposal on ERC sectoral plans worth discussing, but we should stay away from the institutional support. On the ERC's independence, let me be crystal clear. The ERC is a European success story.
The commission has been and will remain a staunch guardian of this independence. And this partnership relies on a clear balance of both autonomy and accountability. The current balance has produced the success of the past 20 years. The scientific council determines the scientific strategy, while the commission ensures its autonomy and the means for implementation through a dedicated implementation body. This has delivered outstanding results and allowed the ERC to support the pioneering research that Europe needs to remain a leader.
Many independent evaluations also noted that this framework provides a robust shield against external pressures. On the EIC, we consider that the current advisory role of the board should not be changed. This has been part of its success, and the Board already has key responsibilities like advising on work programs and being involved in the selection of program managers. Appointments of program managers, however, should remain the responsibility of the EIC implementing body. Finally, on research and technology infrastructures, we take note of your suggestion to replace the 20% contribution with a different approach involving the European Semester and different funds.
Our immediate worry is that we would lose the accelerating incentive which central EU-level funding brings. I will stop here for today and repeat the commission's full availability for further exchanges. Thank you very much, Vienden.
Stéphane Séjourné
Thank you for being with us still.
For his closing remarks. Please.
Speaker 29
Thanks, madam chair. Thanks, colleagues, for the exchanges that have shown that this is a debate that is fruitful and that will also continue to be fruitful in our attempts to find compromise amendments supported by a majority in this committee. Let me address, as part of my final remarks, the element of the sectoral plans. Because it is an idea that I pitched so that we do have a discussion on it without having, without insisting on the place where it is located, or other elements to it. It was mentioned a collaborative dimension is underestimated, and that is precisely an element of it.
It is on call on the collaborative dimension, but in a sector in an entire sector. The idea behind it is the following. We do have excellent researchers out there. And, I used to work at the faculty where I had the obligation to support reg to submit regularly, requests for funding to research bodies. When you look at young researchers that are overworked, that see that there is a 10, 5, 2% success rate to only apply for it, to go through all this with all their talent, it is creating disincentives for smart talent to actually join the entire process.
We see that if we have calls, research institutions and researchers make themselves beautiful for the particular call, which is not per se the same as the talent that those researchers can actually, that the talent these researchers have and that by which they can contribute to our research agenda. The sectoral plan says that it is the sector as such that wants to elevate, but the sector as such looks at what they are best at and then looks at the researchers at what they are the best at, but at the level of the institutions which represent an entire sector. And by that, you have a selection of talent outside of the very competitive, only PI-led research project. It is a different mindset. In this mindset, research institutions do not make themselves more beautiful in line with calls created by civil servants, but they look at themselves, what they are the strongest in, and design a call to elevate the entire sector.
After six years of sector plan in The Netherlands, the final evaluation has shown that this approach has actually elevated entire disciplines with regards to worldwide competition by changing the mindset of how research excellency is programmed. This is something that cannot be done with an enormous program. It is a change of mindset. And therefore, what was proposed here is a tryout for a sector under pillar one because it is looking at the research part. But from my eyes, it can also be in Pillar two as long as it is ERC-led so that this expertise network and the expert-led way of how this is peer reviewed is actually preserved, so that we can actually increase collaborative research.
This is also in the interest of widening because I am very much convinced that widening and excellency are not going against each other. On the contrary, it is biases in selection that lead it, that if we speak about excellency, we have a certain concentration on certain parts within the European Union. So if you go for a different mindset of how research institutions cooperate and selection procedures are organized, you can easily bring widening and excellency together without undermining the other. That is the idea behind the sectoral plan. This is why I have pitched it for discussion.
I'm curious whether we can find jointly a solution that deals those ideas can be actually further developed. Thank you for having the opportunity for this exchange, and I'm looking forward to further discussions with the team of shadow rapporteurs.
Stéphane Séjourné
Thank you, rapporteur. And I think that you will have the time and also the opportunity because the deadline for tabling amendment is September as the rapport the report before. September at 05:00, in this case, and the other is at noon. So we have finished the presentation, the discussion. We have half an hour for whatever you want, and then we will have Commissioner Sejourney.
Speaker 35
Thank you. Please, colleague, from the moment that we have here our vice president and vice commissioner, we are on time, and we can also have all our time to have a very good meeting with him. So thank you very much for being here, Mrs. Agiorni. And I would like to welcome vice president for Prosperity Industrial, and thanks once more for accepting our invitation. It's a very pleasure for our committee to share opinions with you.
Stéphane Séjourné
We have approximately 90 minutes for this discussion, which will be conducted in accordance with a speaker list. I invite all members who wanted to take the floor under Catch the Eye to put their nameplates vertically in their order. Time permitting, I will allow members who want to ask follow-up questions to do so. So please indicate that to me. I wanted to remind everyone to please stick to the allotted time, but I can give some more time if I can since we have the time.
I would now like to give the floor to Monsieur Sejourney for 10 minutes to make his opening statement. The floor is yours. Thank you.
Speaker 36
Thank you very much indeed, Madam Chair, members of the European Parliament. Right. We're meeting today in a situation where every single decision counts. As you know, this world is marked now by geopolitical instability, where economic balances have been undermined and value chains, supply chains are threatened. The crisis in the Middle East has its consequences on our economy and our energy security.
And therefore, Europe can no longer simply react. It has to preempt. It has to innovate. It has to adapt to the new geopolitical situation. And that's what we're doing with our new industrial policy, which works along four major lines, four major priorities interlinked with one another.
I'll run through them just to provide you once again the big picture of what we're doing in terms of adapting our European model, adapting it to this new geopolitical situation. Firstly, we have to stimulate demand for our strategic industries in order to reduce our dependencies, and I'll come back to that at a later stage. Then we have to strengthen our own internal markets so that we make it a lever for growth and competitiveness. And this morning, there was a hearing in IMCo where the internal market became, we said that one of the internal markets has become one of the major growth factors for our European industry, 3% of GDP if we manage to remove the barriers. And something important will happen in the next few weeks with the road map on the internal market, which has to work closely together with what we want to do in industry more generally.
I'll come back to that. We also have to mobilize both public and private investment to finance the transition and the future. That's on the competitive front. And we have to diversify our partnerships in order to secure value chains and supply chains, and reduce our dependency. These are all the trade agreements we're trying to multiply now to try to reduce the risk with foreign markets and allow our companies not to depend on one single market at a global level, particularly when they are exporters.
Now I would like today to look in greater detail into one point, and that's the work we are doing for our strategic industry. The draft Industrial Acceleration Act, I think, represents a change in doctrine for the EU, bringing together three priorities: the competitiveness of our economy, the decarbonization of industry, and also our economic security. These are the three priorities, which also have to feed into the strategy for us to adapt to the new economic situation. We want to ensure that there is a European preference when money is used from Europe, thinking of direct subsidies there. There are three pillars which are affected by this.
These are high energy industry, aluminum, cement, steel, but also the chemistry industry as well, and automobiles. I'm thinking of buses and trucks and hybrids and all the clean energy, which is linked to this. As I said at the beginning, batteries, wind power, photovoltaics, nuclear, all of these are the key issues to energy sovereignty in the years to come, which will allow us, the Europeans, to be able to produce energy in Europe and to be less dependent on fossil energies coming from abroad, which are affected by crises. And that's why we talk about that in the text on the industrial accelerator. Now for each of these sectors, therefore, we are going to be asking for a percentage of critical components originating in Europe.
For certain technologies, we've identified a strategic component which is important in all of this. For batteries, for example, we're talking about the cell. And then before I continue on the second measure, maybe I can talk about our partners of confidence, so that I can explain how we came up with this proposal in the commission. Let me start by clarifying that the accelerator focuses on the point of production, not the nationality of the company. I've read an awful lot in the press about the fact that European companies could have been privileged.
The accelerator focuses on production in Europe, production capacity. And we don't discriminate in terms of the nationality of companies producing in Europe. Made in Europe is a question of production, not of nationality. And I want to clarify that because I've heard various economic analyses, political views, saying the exact opposite. So that said, the idea is very simple.
Partners of trust, those, in other words, with which we have trade commitments, will be involved in the setup if they respect their commitments, and we have reciprocity on public markets. A lot of our partners have national preference, as you well know, with various provisions either on national public markets or local ones. National preference also in the case of analyzing their public bids when there is an adjudicating authority. And so we expect that we should be integrated into their markets, so that they can be integrated on ours. That's what reciprocity comes down to.
And the Industrial Accelerator Act will also allow us to act as a lever to open up other industrial markets internationally for our European companies. So that they're seen on an equal footing as a national company, which they wouldn't have been in the past. And the Accelerated Text will probably show its use in the diplomatic and trade negotiations we will be having with our partners of trust. The second important measure for us is, well, let's say, foreign investment conditions. And I want to focus on this because Europe wants to remain attractive for foreign investment.
The international climate actually, I think, supports us as being a refuge value because we're reliable, we're stable, we have the rule of law, we have the ability also to make legal institutions available to defend the rights of both companies and consumers. So all of that makes the European model very attractive, obviously, but this investment must necessarily create added value on the European territory. We've seen some examples of assembly plants.
which
Speaker 36
have been used to provide the logo of Made in Europe, but provide no added value or growth on European territory. And so in those sectors which seem strategic, batteries, electrical vehicles, photovoltaics, and critical raw materials, there, the foreign investment must respect at least four of the six criteria we established. I mentioned three, which I think are very important. Firstly, the transfer of technology. So that's about making up for some of our technological delays.
And to make up five of the ten years we have on technology for batteries, for example, compared to China. At least 50% of employees should be based in the European Union. That's an obligation. And 49% foreign participation in capital in the case of joint ventures. That's what we asked of the Chinese, what was asked on various sectors over many years, which saw a massive transfer in certain key sectors.
I'm thinking of cars, for example, aeronautical industry as well, or nuclear technology as well, where the Chinese wouldn't have been able to make up for their delays compared with our own technology. So I think all of these points are important to get out there. Again, they don't limit investments from what I've heard people expressing fears here, but rather means that we will be able to maximize these international investments and foreign investments on European soil. Thirdly, we have to accelerate industrial projects. Too many are canceled because there are no permits or things take too long.
So we're going to have a single digital outlet for one single process, and we're going to establish priority industrialization zones in order to facilitate the setting up of industry access to energy, facilitated permitting with shorter times, industrial zones, therefore, that have a real industrial vocation. This industrial policy is based on common sense, taking account of European and collective interests in a tense geopolitical context, with a lot of uncertainty. And we obviously have to take account of those economic factors as well as the environment. And I'm making a point here that I said during my hearings last year, that decarbonization has become an economic strategy almost before being a climate strategy. Well, obviously, it still is a climate strategy.
But we have to speed up the process. We also have to be in a position to channel more means towards decarbonization. I'm thinking here of the European Competitiveness Fund that you are currently examining. And I wanted to thank all of the shadow rapporteurs on this, as well as the rapporteurs and coordinators, in order to establish a global framework to support the entire investment channel. And this fund will provide critical mass and allow us to channel strategic flows.
What's happening in the Strait of Formosa right now obviously brings a new focus on our dependency and the question of our energy mix, pilot markets as well as our decarbonization strategy. So the text, I believe, is moving in the right direction. And I'm thinking also of all of the sectors and sectoral plans that we've been drawing up since the start of our mandate, the automobile packet, which revises CO2 standards, the fleets, the booster batteries, or other simplification measures. I'm thinking of the launch of the European Alliance for Chemical Products as well. Many initiatives have been taken since our mandate began. And I would like to thank the Parliament for its support.
On to my final point now, for Critical Raw Materials, which also fall within your committee. At the end of last year, we came up with some proposals, and we're speeding up there also on the Critical Raw Materials Act. As you well know, we also proposed certain amendments, and they are before you right now, in order to cover the situation if we lose supply or to focus on recycling. We maintain our ambition with a proposal on the circular economy. This is planned for the third term, with a clear aim to overcome obstacles on the single market for waste, secondary materials, and to keep our scrap in Europe.
That's a genuine challenge in order to set up a genuine business plan and a business case for the recycling industry, and to use that to support our sovereignty as well. I apologize if I've spoken too long, Madame Chair, but the commission is also very much involved and has done a lot of work on industrial dossiers. And this is our European response to a changing world, where resilience, competitiveness and sovereignty are not decreed. They are built. And I'm absolutely convinced that the cost of our independence is lower than the cost of dependency.
And that's what the commission has been addressing now for several months, again, in this rather tense geopolitical context. And I'm here and ready and willing to take any questions you may have. Thank you.
Thank.
Stéphane Séjourné
you. All of this really is such a very important subject that we need to keep some time. We need to make sure that we do have enough time to listen, and then to have a good discussion afterwards.
Coordinators, first, and I will attend it to mister earlier on behalf of batch. Okay. So we have mister Beke, please. Yes.
Thank you.
Stéphane Séjourné
For ninety seconds and then immediately, the answer of the commissioner and then another thirty seconds each, please.
Speaker 37
Thank you, commissioner. Thank you for being here. I think that, well, we all know what the urgency of the situation is. We have our energy costs. We have our imports coming from outside, Chinese products and so on, and we have to enlarge and to strengthen our internal market position.
Speaker 38
And for that reason, it's good that the commission takes a lot of initiatives for this to strengthen our economic and our industrial power that we have because we need it very much. And I think that the whole discussion made in Europe and made with Europe is a very difficult discussion because, on the one hand, we are looking for free trade agreements with new countries worldwide, Australia yesterday, and so on, and on the other. And so we have to keep this in mind. And on the other hand, we have to strengthen our own companies also in Europe. And I think that we have to look to this middle ground that, on the one side, we have our own companies.
Speaker 37
And we need to take all the possibilities that we have to strengthen our market power and our market position. But on the other hand, also look to the possibilities that we have outside of Europe, and that the one is not contradicting the other. Thank you.
Speaker 36
Share your conclusion, which is to say that things aren't contradictory. But as I was saying in my introduction, the four pillars need to be resynchronized in the legislative area if we want to really be effective. I think that diversifying our partnerships is a key point, and we've seen this in all the trade discussions that we've held. The more we reduce our dependence on exports as well as on imports, the stronger we are because we depend less on foreign powers. What's also important is to strengthen the internal market, 3% of GDP in addition to what we have.
If we reduce the 10 barriers that we've seen and that we've focused on and that we've identified in the internal market, well, that's a very important element because the internal market doesn't depend just on us. Well, it just depends on us. It doesn't depend that way, it won't depend on all of the external factors. It would depend only on our political will to move forward with the construction of the internal market. And so it's important to beat that path now.
And it's also very important to follow on with the third pillar. If I secure my industrial basis and my strategic sectors, well, I need to do that because I'm being attacked, including with trade policies. And so Europe is paying the least for its raw materials. And that's not because people love us. It's because there are people who don't want us to have profitable investments.
And so we need to invest there. We need to continue to develop our independence. Oh, this idea of raw materials or having a car industry, steel industry, being able to produce clean tech, that's the energy of tomorrow. But I'm convinced, and there are very few people who say all of this with the people that want to look at these things individually. They don't want protection, but they do an industry.
Some don't want trade agreements. Now if we don't look at the big picture, then the best thing to do is to stay, to stand still. And I think the worst thing we can possibly do in the current situation is to stand still.
Speaker 37
I agree, and I think that this was the aim of the commission and that we have to found it. And with the current situation in Iran, there are a lot of things that we cannot do, but there are things that we can do. And we can act on behalf of Europe by itself, and so it's the right moment now to do it. Thank you.
Stéphane Séjourné
Thank you. Oh, you want to add something? But we have time for others. So on behalf of S and D, Mr. Dannica.
Speaker 41
You, Chairwoman. Monsieur Sejeuner, you are vice president of the European Commission in charge of industry. And in this current period, our industry is under a lot of stress. International situations, market situations, and unfortunately, less activity in a lot of fields. You've mentioned steel, but there are also others.
Chemical industry is going through a tough time, the car industry as well. And everyone is waiting for an answer that should come quickly. You've made efforts, and you have that plan. You have presented also other measures, good as well, eagerly awaited by Romania too, because lately, our biggest steel plant has stopped production. It has been at a stop for 9 months.
The chemical industry, fertilizers, and car parts producers are all waiting for the financial details. Do you have a measure or a plan that tells them you will have access to financing under better conditions? Now in Romania, interest rates are 10%. So we need a plan that should help with access to loans for those who work for the European industry. So this is something everyone awaits eagerly.
Thank you.
Speaker 36
Thank you for your introduction. I do share the situation. We're destroying about 20,000 jobs each month in the industry since the beginning of this mandate. Your mandate in this parliament, 10,000 in Germany. So you can see the situation.
The industry isn't in a good situation. And it's not the fault of made in Europe. There are two major problems: the overcapacity, price of energy, and there's another problem, which is investment indeed. We have various mechanisms. We've got the facility to reinvest.
We've also got the provision where we need to talk about the decarbonization. There's this reinvestment mechanism that should allow us to strengthen our productive capacity. And then we've got the decarbonization provision, subventions and loans, which should allow us to accelerate what we're doing. If I'm honest, well, we would probably need more money, more focus, and a lever with the private sector. If we increase the tools like InvestEU, public guarantees that allow us to really mobilize a lot of public money but with not very much private money in the system.
Well, there are also these infrastructures like in chemicals. There's investment of more than €1,000,000,000. And investing today with the conditions of the price of energy, the international conditions that we're facing with very little demand, unfair competition with China. Well, for investors, private investors, that's a challenge. We have to admit that. Our responsibility is to find conditions for investment that are favorable to investors. I've said it before, Europe does have value, continuing the current situation, but we need to find a way to deal with the public financing and the guarantees to be able to focus on the 50 or so industrial sites that need to be modernized over the upcoming years.
We did a small calculation at the beginning of the mandate. I think I even said it in.
Speaker 36
room. The 100 sites that give the most a certain amount of the most emissions are equivalent to 50% of all emissions in the EU. So we're going to need to target this. It's across the 27 member states. There's no issue with geographical balance there.
And we need to focus on that. So I would always push for more, more financing provisions, but also, and I'm being reminded of the time. But I think that we, or within this framework, we need to be able to improve investment conditions for investors.
Speaker 41
Mr. Sejourne, I agree to what you've said and particularly that Made in Europe is something we should take up immediately in the competitiveness fund. You'll see, I'll make some proposals to strengthen Made in Europe and also investments in energy and competitiveness for the European industry. But the question is now, with the war in Iran, greater prices for petrol leading to higher prices for electricity, will there be measures for small companies or big ones to help them through this period, through this time? Do you think of particular measures that you will introduce for this time, telling those who have problems?
Let's say, by the end of the week, there will be peace. But I can you say, with the commission or the member states should do these things in order to support small or bigger companies? Thank you.
First.
Speaker 36
Of all, all of our sectorial plans are thought of as urgency plans. And so the area that you know best, steel. Let's take that as an example. Our plan is implemented progressively. I think that the next try log will take place on the safeguarding clause, I think, for steel.
And so we're going to create conditions, including the modernization of our industries. We're creating or allowing our industrialists to work with to electrify, and that's well, that's what we did with cars, with the possibility of having green industries of steel or car, and that fits into the value chain. So that's what we're doing in reality. And we can't just think about saving these sectors through public funds. And I don't think that we can do it without public investment.
We have an important responsibility, decarbonization of the economy with very strict rules. That's what we've done. And the geopolitical context isn't favorable, and it's public powers and Europeans to be pragmatic in the way we move forward with decarbonization, and to be able to financially help. So I would say that it's both. And our sectoral plans are already urgent plans.
They're already thought of as being urgent plans. And the creation of demand, investment, modernization of sites and the tools that we'll be using, the financing, these are all responses to this sector.
Speaker 43
Now for Patrick's colleague, Börje. Thank you, and welcome to you, Mr. Séjournet. Now you were talking about the Industrial Accelerator Act, and you defined it as a change of doctrine. I think we'd all agree on that.
Speaker 44
But the numbers tell us how long the path is ahead of us. Now in terms of the GDP, we've seen a drop from 17% at the start of this year to 14% right now. And it's just as important as well, a series as well, for the needs to make up for the gap at the international level between us and our competitors. China provides industrial subsidies, which the IMF has quantified at 4% of Chinese GDP, and that's more than the European countries can spend. And obviously, prices, that's a huge issue because they're more than double what they would be in the America.
Speaker 42
So in this context, European preference in tenders and also permitting processes obviously are positive measures. But protecting struggling sectors without intervening on the structural issues which have led to these difficulties isn't conducting industrial policy. It's a damage reduction policy which will allow us to make up time, but nothing more. So without a plan to contain the cost of energy made in EU, provisions will become a further burden, particularly for the smaller companies out there. So I'd like to ask you whether the Industrial Accelerator Act will also come along with structural measures for energy costs.
Because if we want energy European companies to produce more in Europe in these favorable conditions compared with the competitors, that's not a strategy. It's a contradiction. Thank you.
Speaker 36
Thank you. You're right. The problem is the cost of energy. And once again, the answer was clear from the commission, but I think that the decision was taken immediately. You have a sector.
That's a sector, mostly a national sector, managed cross-border, very mixed. There needs to be an agreement between member states. And then you've got the European electricity market, which also creates these differences in the energy costs per page from one country to another. That does become it's becoming a very serious problem of internal dumping for Europe. And what we see is that when the prices are so different between us within the EU, it's going to be more difficult to have a common response.
It's something that we're trying to deal with a shared response. And I share your concern, but I don't have a miracle answer. We've got my colleague who's in charge of energy who, well, there are some short term solutions and some long term solutions. The long-term solution is clear. We need to reduce our dependency on gas.
The short term solution is clear for some industries, can build PPR and long term agreements by leasing prices to be able to get out of the market with the very energy intensive sector, so we can have access to electricity more easily. But there is a structural problem at the European level. You're absolutely right. Made in Europe. I can see a lot of national preferences.
I can see a lot of international preferences, but I would go for the European preference. If you look at public procurement today, publication of offers for public procurement on platforms, regional or national platforms where European competitors don't have access to the information or where if you go to a European market where it's not expensive and where they prefer to do a 100% sourcing of raw materials from China against our interests, then I see a lot of international and national strategy, and very little European interest. So we, as institutions, parliament, commission, we need to bring European interest at the center, European preference at the center of these strategic sectors to avoid. We do see in some countries that there's a lot of national preference, a lot more than we would actually think. And so we end up then just getting internationally, supplying internationally, which is unfair competition with our own European interests.
And so pragmatically speaking, what we've done for the specific sectors when we're talking about public money, that seems to me to be reasonable. And within the framework of simplification, there's a change in this text as well. I'll perhaps come on to that. But everything is a self-declaration, and control is done afterwards. And so the text doesn't create any type of administrative burden or additional red tape.
I'm saying that honestly. I've seen a lot of messages on this subject. This change in doctrine is an important one, including the simplification, and the text is providing it.
Speaker 42
Thank you. Very quickly. Yes, with the current energy costs, it's been estimated that ETS kicks in for about a quarter. President van der Leyen in Strasbourg said that the ETS is not going to be touched. But I'd like to ask you whether van der Leyen has the last say on this, or is there some leeway within the College of Commissioners to debate it?
Speaker 36
I'll try to be briefer. I'll be honest. The ETS was dreamt up as an investment mechanism and for the modernization of our industry, and now it's seen as a system for taxation. And I do have the figures. Less than 10% of the ETS revenues have been reinvested by the member states, not by the commission, by member states in decarbonization or in renovation and modernization of industrial infrastructure, less than 10%.
So this system has taken almost €300000000000 from the companies and has then transferred 10% into investment. The rest of it has gone into expenditure or the general budgets of the member states. And so my recommendation, but I'm not in charge of this subject, is to make this instrument into what it was supposed to be originally. So 100% is there to improve conditions and to modernize our industrial infrastructure. And that's what we're facing, really.
If we had €300000000000 invested in European industry for modernization, then we would have a lot fewer problems than we currently do have. And there, there's a responsibility, and it is a responsibility of member states.
Speaker 45
Thank you, chair. Thank you, commissioner, for being with us today. Well, first of all, on the Industrial Accelerator. My first point is that I agree that we need to restart industrial production in Europe, of course, but I'm afraid that your 20 target is too ambitious. So I'd like you to elaborate more on that, and why are you convinced that 20% can fly?
The second point is worth mentioning that energy intensive industries and automotive industry are in a difficult situation because of shortcomings in European policies and the regulations, which we have done so far. So in any case, if we want to help them, we will strike a reasonable balance between openness and autonomy. And in this regard, I'm concerned about the impact on the automotive industry, is already facing significant uncertainty? Why are you imposing strict conditions on them in this critical moment, for example, regarding the batteries? Why should we cut off imports from traditional, reliable partners who have been operating in Europe for decades?
In one minute, too.
Speaker 36
We started the 20th century with 20% industry in our European GDP. And the ambition in the next few years is to come back to this industrial level. So this figure didn't come from nowhere. We came up with 14%. And I do understand your intuition on the ramp-up possibilities, particularly considering the conditions that we're facing today.
But we do need to make sure that we are able to create conditions to bring production back to Europe. And as I was saying in my introduction, I'm not looking at the nationality of the company. I'm looking at the conditions including foreign investment in Europe and to become attractive again for certain industrial sectors and for that used to be attractive and new ones as well. We're not just talking about bringing back historical industry, but also new industries that we could lead up in the upcoming years. Impact on the sector, unfortunately, we've already dealt with a lot, for the reasons that I've already mentioned.
We have a double phenomenon, if you like. First of all, we need to catch up our technology and industrial delay in certain sectors. That's key. I'm thinking about batteries in particular. Batteries are going to sort of depend on all of our uses, whether that be industrial or individual, moving towards the future.
And it's not reasonable to think that Europe can't have its own technology and develop it on its land, on its continent, and produce it here as well. Wars or geopolitical conflicts, etcetera, these are the types of things that are causing us geopolitical difficulty, particularly if we let this technology go for other sectors as well. But once again, we need a more horizontal approach, and we need to think about our commercial blockages as well, how we can deal with those, particularly exports and our conditions for competitiveness with trans or with cross-cutting criteria.
Speaker 45
Thank you. On another note, I'm pleased to see the beginning of a shift in support of nuclear energy even in the European Commission. And that's why I would like to ask you, because last time, I've asked you about the status of the review of a Czech partnership with a Korean company for the construction of new nuclear reactors. So could you please update me on where we stand on that?
Speaker 36
Part of the answer is in the accelerator, and part of it is about the value chain in nuclear. Once again, foreign companies, be they Korean or American, will always gain market, will always, in the public procurement sectors as well. But two or three strategic components for nuclear power stations. We want to make part of it obligatory to have production in Europe or partnerships, a couple of these components to look at the subject. Now there are discussions among member states.
And here publicly, I don't want to say anything that I shouldn't, but I do have a positive feeling on the way in which this subject is moving forward.
Thank.
Speaker 46
Thank you very much, president of the meeting today. And dear colleagues, thank you very much for being here today at the E-Trade Committee. The context of it means that we have to act quickly. These are the subjects that we're dealing with now, and I hope that the European panel will be able to react quickly to all of these subjects. Chinese exports towards Europe have increased by 28% since the beginning of the year, and that risks millions of jobs disappearing across our continent.
And when facing this reality, we need to celebrate the IAA presentation. This is a very important change in our industrial doctrine. And I'd like to underline two advances. On public procurement, these are finally becoming strategic levers to stimulate demand in Europe. And then on foreign investments, where we're finally starting to move out from naivety and putting more demanding requirements, but at the same time respecting our international commitments.
Speaker 47
And with the continuation of the Net Zero Industry Act, you are reinforcing the criteria of sustainability, resilience, and cybersecurity. Now the clear point that we have to focus on is that we need to be ambitious, and we need an ambitious, balanced, and understandable approach for our industrialists. And so, first of all, for Made in Europe, why have you kept an opt-out approach for the countries considered to be equivalents? Do you already have a vision of the final perimeter of these countries? And then, more strategically speaking, how can you ensure that this enlargement will be coherent with our objectives of re-industrialization and strengthening production in Europe?
Speaker 36
Thank you very much. First of all, the resilience criteria and sustainability criteria were no longer necessary or sufficient, as our industries are moving to China. So we need to have a European production in good conditions, to not create an excessive cost, and to make sure that what we're doing is done pragmatically with very focused components. But we do need to have a voluntary type of policy for production at the European level. Otherwise, these criteria that we very often used for resilience and sustainability, well, weren't enough to avoid industrial evaporation.
The 200,000 jobs that have been lost since the beginning of your mandate here in the European Parliament, since the beginning of my mandate as a European Commissioner, and 600,000 jobs additionally in industry which are at risk over the next few years. So it's urgent that we act now, including temporarily, maybe to have another look at the provisions that we have later. But we do need to make sure that we act now so that we can avoid losing resources, technology, jobs, know-how in the sectors where if we lose this know-how and this industry, then we will never reproduce these industrial centers as easily as they were destroyed. That's the first point. Second point, the perimeter.
Opt in, opt out. Well, at the end of the day, that's the same thing. We need criteria for the lists. We need to have trusted partners, partners with whom we have agreements on the commitments of a public procurement with us. But we also have a criteria of reciprocity, which should allow the commission to open other markets to the outside and ask for reciprocity of openness for our procurement markets and with our trusted partners. An example is Canada.
As you know well, there's Canada. But Canada is 15% more on a tender if you're a Canadian company and you respond to a tender in Canada. Well, I would like European companies and this 15% extra like the Canadian companies do if the Canadian companies want to be considered as European companies. That's just normal, I think. And I think that reciprocity is the right criterion. So the list of partners isn't a problem when there is reciprocity, and that's what we wanted to introduce.
Speaker 46
Well, a product that's made in Japan becoming made in Europe, I don't really understand how that would happen. But okay, fine. Now in the version of the commission's text, is it more interesting for foreign investors to invest in countries close to Europe that are considered equivalent, such as Morocco, instead of coming into Europe? So what's the solution that you have for dealing with this effect, which is a sort of opportunistic effect? So investing in our neighbors to take advantage of our markets instead of investing directly in our market.
Speaker 36
Yeah. There will be those types of clauses. If you look at the text and in the parliament, you'll need to have a look and see if there are any gaps. I'm very open to going through and looking at all of the provisions that the parliament and the council will bring up so that we can adjust the partners list if needed. One of the points that is important is who these partners are?
Who today are those that respect reciprocity? Of the 40, I would say that there's about 20 today who do have the reciprocity that I was explaining. That doesn't mean that we can't use the IA and this text as a lever to find new markets. And we can, of course, also think strategically. This text is a way in which we can open other markets to other areas.
Stéphane Séjourné
And now the floor is, on behalf of Greens, Miss Isabella Lavin.
Speaker 49
Thank you very much, madam chair. Vice president, I will speak in Swedish.
Speaker 51
European competitive nurses base it on ensuring that we can be successful in the green transition. I would agree with the vice president here. These things go hand in hand at the center of all this. We also see emissions trading. This is the most effective instrument that we have to be able to move forward with the green transition.
In recent times, we've seen worrying signs of member states that want to weaken and modify their systems. And this has led to concern in the industry. For example, in Sweden, in the steel industry where investment has been made in green transition for a long time now, well, they are now seeing that the prices of emissions rights have reached low levels, very, very low in the past month, and that's not good for predictability, and it's not good for investment climates in heavy industries. I would like to ask you if you think that the ETS is central to being able to achieve an industrial transition and for European competitiveness, and how we're going to ensure that we can maintain the speed of this transition with this system? Thank you.
Speaker 36
I'll say it again.
For the European Commission, we believe in the system. It's allowed us, I think, to modernize, to transform, to decarbonize in a lot of different industries. My vision as one of those responsible for this strategy is that this provision has often been badly used and has, in a way, been shifted away from its main objective, which was investment. And for some industrial sectors, they are right in thinking that that tax is being taken, but there's no investment coming in from the other side. And that is a problem of perception, but it's also a real problem because of the €300,000,000,000 that have been taken from industry and from European companies from ETS, only 10% has really been used.
And so that's why my recommendation, once again, well, when there's a revision that's been announced by the president of the commission, we will be able to have a look at to what extent this provision can once again become an investment provision and not shifted away or the revenues from it not being used for something else? Thank you very much for the answer. So this means that the commission is planning on opening the ETS. And how are you going to ensure then that member states use the revenues in the sectors that most need it, that most need investment for the green transition? I think it would be very interesting if you could explain how we could ensure that this actually happens, instead of what a lot of member states want, I think.
Speaker 50
We need to make sure that there is actually a true and a freer sharing towards other industries.
Well,
Speaker 36
The president committed to that in Antwerp, that revenue from the ETS should go back to industry. So we could propose a reform or revision that would be moving in that direction.
Stéphane Séjourné
Thank you, Vice President. And now for the left, on behalf of the left, mister Anthony Smith.
Thank.
Speaker 53
You, Madam Chair, Commissioner, colleagues. Well, it's urgent that we act, you said. Our colleague from Renew was saying we have to act quickly. Now for the past 14 months, the Commission has been there, and it's only decided on its plan now. You're talking about 20,000 industrial jobs being lost every month.
Speaker 52
And I imagine that means to you acting quickly and urgently. Well, this plan is a reflection of Macron-like policy at the European level that we've been subjected to for the past nine years in France. On the one hand, you're proposing a plan for European preference, but then you're allowing non-European countries to produce for Europe, moving from made in Europe to made with Europe. You're proposing a reindustrialization plan to guarantee supply chains, but it only covers a limited number of sectors and excludes certain strategic ones, particularly in digital technology. Well, France and Saumis didn't really expect an awful lot from all of this, because you're still within the liberal pattern.
But this text could finally have introduced a strategic development plan for the sectors, reestablishing the European electricity plan. And allow me, you should also.
Oh, sorry. Well,
Speaker 36
Yes, it could have also established environmental conditionality as well as social conditionality of aid to support the protection of jobs for workers. Thank you. Well, I'm penalized in my speaking time because I speak slowly for the interpreter's sake, says the commissioner. No. Please go ahead.
Thank you, Madam Chair. Well, Mr. Smith was asking me about something a year ago. You were saying you're dropping Dunkirk and the rest of it. I said we were going to do something, introduce the safeguard clause.
It was proposed to the parliament. We've announced investments. The ETS has allowed for investment in electric furnaces. We found outlets for the low carbon steel in the automobile industry, we saved jobs. I mean you could at least have started by saying, well done, Commission, because you kept your promises from the last hearing that you had in this committee.
I would have been really happy if you'd started by saying that. Secondly, European preference. Well, since SHERAC, I've been hearing people talk about this in France. For non-French colleagues, that's 95 basically, Jacques Chirac. I'm not going to go through my country's history, but when my colleague starts getting involved in national policy, obviously I have to react in the same way.
So yes, but it's this commission that's done it and has come up with this text. That's all I have to say, basically.
Thirty seconds.
Speaker 53
Yes, I'll be as quick as possible. I'm really sorry, Mr. Sergei, basically, what you say doesn't corroborate the social reality in the country I live in. And it's important for hundreds of thousands of workers who are going to be affected by this change. You said 600,000 over the coming years.
Speaker 36
Well, how can you take account of that in your plans, particularly in qualifying workers and ensuring professional careers? Once again, there's not enough on that. Well, on the last point, we worked together with the trade unions and employers. And I think that what we've done reflects the ideas of transformation support for the sectors. And my colleague is also going to come up with certain proposals, which don't fall within my portfolio.
But obviously, transition is going to speed up. Also part of the loss of industrial jobs, well, we have the impact of AI as well, which is putting an end to certain professions. And particularly, it's the white collar workers, qualified workers who are going to face a bigger impact than the workers within industry itself in that forthcoming revolution. So yes, all of this has been taken into account. Yes, we did work with the trade unions, and we continue to do so on this dossier.
Stéphane Séjourné
On the rule, the turn, rule changed. So we have the colleagues that has already listed. One minute each at the end, you can answer. So would come. Please, EPP, Miss Angelica Vinzing.
Seán Kelly
We have changed because I'm sharing a meeting immediately, so Angelica has let me go. Okay. Thank you very much. Commissioner, I agree completely with the principle behind the Industrial Accelerator Act. It is absolutely vital that we promote Made in Europe, that we re-industrialize Europe and keep whatever industry we have here.
But it may come at a cost, and I'm just wondering, can you talk us through the modeling and analysis your officials have carried out to assess the impact of these measures on prices, competitiveness, and downstream industries? And how can we best ensure that industrial resilience does not come at the expense of affordability? And secondly, in relation to fund direct investment, I see where you're coming from, but there's a big difference between different companies investing in Europe. I know in Ireland, we'd be lost if we didn't have the big pharma companies and the tech companies. They're not replacing anything else.
The opposite is the case, since with some other companies, especially Chinese and so forth. So I think that distinction may need to be made. So I would ask your views on that. Thank you very much.
Thank.
Speaker 55
You, commissioner. 20,000 jobs, industrial jobs every month, 10,010 of which are in German. So it's about time we did something. It's not about whether we should do something with our industrial policy, but what we should do. If there are people in Berlin and they're arguing against made in Europe, then I'm not sure that that's very democratic.
We need clear rules. And when rules are systematically broken by large trade partners, then we have to act in Europe. And I think it's right that this proposal addresses public procurement, for example. Taxpayers' money needs to be used to create value where it is used. And here in the EU, public money has to be used in order to create public value, so that this instrument will have a good impact over the long term.
We have to make sure that costs don't increase too much for certain industries. We have to make sure that free trade remains possible with our partners. And I think it's the right road that you're on, and please keep going down that road in a thoughtful way.
Speaker 56
Yes. Dear Executive Vice President, it's a pleasure to welcome you back to the ITIL Committee, especially after your short visit to Austria. This underlines how important it is to stay closely connected to the realities on the ground when shaping European industrial policy. We are glad the Industrial Accelerator Act has now finally been presented. It sends a very important signal to our industry, and this is important in times like this.
And I would like to raise two questions. First, on permitting procedures. We all know that lengthy procedures are a major barrier to investments. Do we already have concrete data on the real impact of legally mandated acceleration measures, for example, under the Net Zero Industry Act? And if not, why are we not waiting for more evidence before introducing additional instruments?
And second, on reporting obligations and administrative burdens with the Industrial Acceleration Act, many companies that have so far operated only within the single market will now have to deal with origin requirements and related obligations for the first time. How does the commission intend to ensure that such local content requirements do not create additional and unnecessary bureaucracy for these companies? Thank you.
Thank.
Speaker 6
you. Mister Sejeuner, basically, you're stuck between two very different situations of industrial sovereignty in Europe: Germany refusing any geographical criterion, on the one hand, and in France, saying that we should bring production back into Europe. And the final version of the text doesn't solve the differences. It simply shifts the problem. Local production, well, compromise is done on the basis of the fact that a lot of economic players see that this is simply extending the Green Deal.
It's not a reindustrialization program, but another climate program. At the same time, you said that trade reciprocity mechanisms are so broad that international competitors could be seen as partners of trust. How can you really ensure a genuine European preference? And how can you make the industrial accelerator a real point of transition? You.
Stéphane Séjourné
Andrea Alfavicera, I give the floor to myself. Well,
Vice President, I really appreciated two statements you made when you were saying that we want to come back to produce, and this will be the point of production, manufacturing value. And then you also said that the internal market depends on us. So a change in the rules will depend on us. And I do hope that we have a majority here that reflects that. It's not a political majority.
It makes common sense. For steel, in particular, the steel plan that you have proposed is ambitious, and we support it. But we have to ensure that there is also protection for processed products, semi-processed and finished products, because otherwise, we're going to see the death of steel as well, because we won't have the production chain in Europe.
On behalf of Renew, Ms. Elisabetta Gualmini. Thank.
Speaker 58
Thank you very much indeed, Vice President. I fully agree with your main message. In other words, we have to reduce our dependency, and the cost of independence is obviously lower than the cost of dependence. I have two questions. Firstly, I think that the elephant in the room is definitely the cost of energy.
Yes, we're very behind hand, but I think that if the sexual paradigm can be effective even if we need shock therapy, I wonder whether there is a political will to achieve an integrated energy market, because that's a structural problem, that we don't have a single energy market. So what do you think of that from the point of view of policy? Secondly, you talked about a single digital point for companies, for permits, for simplification. That's all very interesting. And I think it's more effective than omnibuses sometimes, because with omnibuses, we create uncertainty for companies.
Speaker 36
Now it's over to you. Thank you very much indeed. I've got a long time then, this time. I'm going to start with the impact of European preference. That's there were several things, several questions raised on that.
Firstly, since 1945, we have had nine massive oil shocks, oil and gas shocks, and they have been much more expensive for us than any industrial policy on decarbonization and energy independence. There, once again, this time with Iran, the increase in the cost of energy by 30, sometimes 50% in some countries shows us that money could have been used in order to boost our competitiveness rather than spending it in foreign trade and purchases of liquefied gas, American, Russian, well, in any case, not produced in Europe. Now, saying that, it relativizes some of our policy on European preference. For cars, for example, we established a rate of 70% of the European components. That's what's happening right now.
So on average, in a car produced in Europe, there'll be an electric car, 70% of the components would be European in a car right now. So basically, it's shifting international value chains. For solar panels, we focused only on the inverter, which represents a little less than 5% of the overall cost of the solar panel. And the market there is 15% to 20% of the public procurement. And so we end up with 2% as a ratio.
And again, these are strategic sectors and components, which you can see that it's all relative and very small in terms of our energy sovereignty and what that can give us in the future in terms of avoiding energy price fluctuations, which force us to pay billions of euros in public money in subsidies in order to avoid energy becoming too expensive for our industry and for our citizens. If you think what could be invested in education, then in security, in health, that's the message I would give. I think we need to be convinced by that, but it's something you need to put into perspective. On permitting, well, I need parliament because I think part of the council will be quite reticent. We have created industrial zones probably to label zones that already exist, which have industry, but to provide an additional service, simplify permitting, facilitating this in zones where there is already heavy industry, but which are not necessarily ecological issues.
There's no question of social acceptability. And so we need you to help push in that direction and keep the question of permitting and the industrial zones in the text, because they're important. Secondly, on simplification, this text introduces two ideological doctrinal innovations: firstly, European preference, and secondly, the question of self-certification and a posteriori checks controls. There is no reporting in this text. And our proposal was that it should all be about self-certification for companies.
And the commission and the national and local authorities could conduct an a posteriori check. I've heard a lot of people saying that, well, it's additional red tape. Well, no. It will actually simplify net zero. So it's basically a continuation of what we've done with net zero.
On European preference, well, we had to start with something. And I think we've made some headway. I'm being very honest. At European level, yes, we have to make compromises. My role is to move things forward.
And it was either this or nothing. The parliament will have its say as well. But I think that this is something which was decided collectively in the College of Commissioners. I continue to push several ideas I believe in. But I think we are nonetheless moving with this text in the right direction.
So I prefer to see the glass as being half full than half empty.
Steel.
Speaker 36
Well, I think we're still going to need CBAM to complete all of this, particularly for derived products as well. We have to try to avoid creating additional red tape and reporting. But on the one hand, you can't pay for the ETS and your competitors aren't playing CBAM, and then have overcapacity arriving in Europe with the one single purpose of killing your industry. So we've already extended 100 products, and we'll see what else we can do to cover that sector as broadly as possible, and avoid carbon leakage. A single energy market, yes.
But once again, we need very strong political will. Now leaving the electricity market for me is not a solution to bringing energy prices down from France, for example, or towards the East of Europe. Certain countries want to leave that energy market, but they export electricity to France, for the French colleagues here. We're talking about more than €5,000,000,000 of energy exports. And if you cut the electricity market, it's €5,000,000,000 less that you would have to reflect in the cost of electricity to protect for nuclear power plants to be opened in the next few years.
So you'd be forced to increase the energy price if you leave the electricity market. So yes, I do understand some rather populist reflexes, people trying to come up with simple solutions for the energy crisis. But if there were a simple solution to the energy crisis, I can promise you we would have found it a long time ago. We need a lot of political will and a decision and a breakthrough also on the question of governance, European energy governance, and the means to actually achieve that. So thank you for your support for the text.
Thank you.
Stéphane Séjourné
Merci, Mr. Levis President. We don't have too much time, but we take the time for the third round. So Mister Gori is the first. Please, the floor is yours.
Speaker 59
Thank you, chair. As equity vice president, I will speak Italian. Well,
Speaker 60
The aim of the accelerator, which we would support, will be to strengthen European industry and create jobs. But there are two points I'd like to mention. Firstly, for public procurement and public support, the Commission's proposal limits the requirements for steel to low carbon emissions provisions, rather than providing for made in Europe as has been done for other sectors such as cement and aluminum. Now the commission justifies that choice by saying that for steel, a safeguard measure has already been introduced in terms of the productive overcapacity of certain Asian countries. But that proposal is limited to rebalancing some obvious distortions in the market.
Well, as we've seen for other sectors, it's a different thing to stimulate low emission made in European production. Why don't we do that? And secondly, I'll come back to the question of the labeling of low-carbon steel, and there's now a delegated act from the Commission. We understand the aim of pushing for a reduction of emissions for companies producing primary steel, but that can't happen by undermining those who've already seriously reduced emissions. Don't you think it's paradoxical that electrical production is compared with production which creates many more emissions, but they can still receive the same recognition?
Thank you.
Esther Lakos.
Speaker 14
I would have an Executive Vice President. Thank you very much for being here. I have two questions, both on synergies. So they are pretty technical. The first with the Industrial Act and the ECF both have provisions and mechanisms on European preference.
And as also the colleague Nikam said that synergies could be exploited. So I was just wondering if the products developed from the ECF could benefit from the EU preference in procurement. And the other question relates to the dual use. So we are moving in the Horizon Europe and European competitiveness fund Realm. So the Horizon Europe proposal opened the door for dual use, and we can have synergies between the two programs.
So I would like to ask you whether the commission would consider the possibility to create a kind of fast track mechanism for promising defense applications of dual use technologies developed under Horizon, so that we push into the ECF for carrying out the development and the industrialization phase. Do you believe that this would be feasible? And also, what would be the challenges in the actual implementation of this mechanism, if you have an overview of that already? Thank you very much.
Stéphane Séjourné
Thank you, colleague. And now the floor on behalf of the Greens, Miss Sarah McHugh.
Sara Matthieu
Thanks a lot, Chair. Thanks, commissioner. I really think that the Industrial Accelerator Act is a good idea at the right time. We need, as Europe, to build out our clean industrial base, not just for the climate, but also for our strategic autonomy. So I completely support that ambition, especially while China is really racing ahead in clean technologies of the future.
But I do want to flag the contradiction, and it has been said at the heart of this proposal because, okay, in this law, we set minimum production targets for green technologies made in Europe, and that's really good, and I completely support it. But in the text, you automatically include most third countries in the targets. So potentially, even the United States under Trump. And really, honestly, for me, that defeats the purpose. You're offering our market access as a gift with not too many conditions to partners that may not apply, the fair market practices against us.
I think the whole logic of the law is really to create a European demand for European production. So this would really carve this out, would really undermine that philosophy from day one. And then we will leverage, we will lose the leverage we have when it comes to negotiating deals. So the question is simple, what's the point of doing that if we really want Europe to achieve strategic autonomy?
Speaker 62
Yeah. Thank you. Thank you, mister commissioner, for coming among us. It's a great privilege, and I'm glad that especially in these difficult days, you are joining us. I would like to focus on one particular problem or issue.
I would like to focus on geothermal energy. It's something that is somehow overseen in the programs and in the materials, but it can provide local communities with affordable energy, electrical energy and heating as well. It's uninterrupted, stable, adjustable, and doesn't depend on foreign dictators or geopolitical complications. And France is one of the leading countries in geothermal energy exploration. So, I know that the European Commission is preparing some paper about it, but I would like to ask you two questions.
Can you confirm the commitment to publish a dedicated geothermal action plan before the summer from the Commission? That's the first question. And the second ask is what is your take on the eventual creation of the geothermal alliance that could further promote and support geothermal energy across Europe? Thank you.
Stéphane Séjourné
Thank you. And at the end, we don't have the time to catch the eye, but we will ask no. We yes. Sharer Christophe Putoijo Fred Tusby. Yep.
Thank.
Speaker 64
Vice president, more than ever, we have to stand up for Europe. And your proposal is going in the right direction, but I think we could do better. I welcome your idea to identify zones of acceleration, thinking of areas in Normandy, but there are an awful lot of other ones in Europe. And I'm very happy that the European Commission has finally implemented the principle of European preference in this proposal. But the content isn't fully there yet, and we could do better.
Speaker 65
There are two things we can work on together, I think. Firstly, we need to be more ambitious, particularly in those sectors where we're already strong. And I'm thinking particularly of the automobile sector, where we could use 70% of the European preference. It's a crucial element for our companies. But there are many examples, which really are the SAP in our veins across the face of Europe.
Secondly, there are certain loopholes created by some of your colleagues because, to be absolutely clear, producing in Europe means producing in Europe. Have nothing against Japan and Mexico, but when it's made there, we can't say that it will ensure our sovereignty. But we will demand things, but you can count on our support in the upcoming negotiations. So Vice President, over to you for 4 minutes. Thank you very much indeed, Madam Chair.
Speaker 36
I will try to be short and brief. Happy birthday, by the way. I think it's your birthday, I believe. Yes. So yes, happy birthday.
To answer your question, maybe I can say that, yes, indeed, at one point, it was about integrating steel into European preference. The commission decided not to do that because there are already other provisions which have been taken to ensure and protect the market, Safeguard Clause, for example, which is the strongest ever proposed by the commission. It's still not been voted on, but it's about 80% of the market, and the creation of a label as well. And I agree with you on that, that we will be trying to reconcile primary steel production and recycling with scrap in order not to hamper those people who've already decarbonized against those who still have to do so. It's two different policies, but they shouldn't be in opposition.
So I think it's important that the label should cover those who've already made the effort to decarbonize, but an incentive also for those who haven't done so yet to do so. And we shouldn't be punishing one group over the other. So the aim is to achieve that in the label. For the United States, well, there are 40 or so countries with which we have agreements on public procurement. And in those 40 odd countries, as I said, 20 or so have absolute reciprocity.
The United States has no reciprocity on local markets and is excluded from our schemes policy, particularly for cleantech. So we'll weigh all of that up, but it's up to you in the Parliament as well to look at the reciprocity criteria. Do you want to keep them, strengthen them? And depending on the criteria which are decided in the text as well, the evaluation of the Partners of Trust will be different. So that's the first proposal, but we need to take account of what has been done on that front.
Over that way, now. Yes, I'm in favor of investment being used to maximize the scale of public investment, particularly on the competitiveness fund. But in order to achieve that, we need to retain the link with Horizon Europe. So I'm putting the question back to you, basically. I need to retain that functional link and to use it under the priorities to use cross-funding, which I think goes in the same direction as your objectives as well.
So I'm sending the question back to you. We need flexibility. We need the link with Horizon Europe, which covers the entire life of a company from its birth and research as well, right through to scale-up, going through all of the tools we need in order to support some important sectors, public guarantees, investments and tools when they're needed, which we need to have included in the commission's industrial strategy. All these elements will allow us to cross the funding, then. But very often, in budget issues, I say this from my own experience, people fight for the budget line, the objectives that underlie it, but not in terms of the cake.
They always look at the slice of cake, but not the entire cake. And if the cake of the European budget becomes smaller, then all the slices of the cake will become smaller as well. So I would encourage Parliament to fight for the principle of the budget and its amount. And if no one in Parliament fights on own resources the size of the budget, then yes, we can have as many political battles on the share-out as you like. But at the end of the day, the cake to be shared out will be smaller.
So that's the message I would like to conclude with. I was a Member of Parliament, and I made that mistake as well at the beginning, that I only looked at the particular slice of cake and not the cake as a whole. Mr. Carlin? Yes, just one point on made in Europe professional fleets.
Well, we're talking about 60% of the market, and it's not the partners. Just to give you an idea of the scale, the co legislators are going to have to discuss that, but that's what we wanted. I will conclude I can have a bilateral with you, if you like, so that we can discuss your point. And then for the rest, I think I've pretty much dealt with all of the points. Thank you very much indeed.
You've understood that this is pretty much a global strategy, trade agreements, internal market protection, strategic markets with a European preference. The amount of the European budgets, it's these four points that really are all completely interlinked. And if we want to create an economic impact, we have to push those four agendas at the same time, very ambitiously. So I'm placing my trust in you, in the parliament, as an ally so that we can have a genuine European industrial policy in the years to come. The Europeans are waiting for us, not only the heads of business and companies, but the people working in these sectors who are seriously concerned about what's happening at the international level.
They don't know whether they're going to hold on to their jobs, their know-how. And so it's also our collective responsibility to be able to propose some new instruments and bring some imagination to bear, also linked to this completely new geopolitical climate. You don't use the same tools in times of crisis as what you do in times of calm. But right now, we're in a crisis. Thank you.
Stéphane Séjourné
To then, Missus Sejani. And also, thanks to the colleagues. And please, madam Vandenberg, excuse the time that we didn't have, but it was a very intensive discussion. And the vice president has already talked very, very much. Thank you very much.
Thank you, madam.
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