The European Union’s drive to turn research into industrial strength has largely failed to deliver products that reach the market, the European Court of Auditors has said in a report published on October 15.
The €17 billion, spent under the “industrial leadership” strand of Horizon 2020 between 2014 and 2020, was not systematically steered towards the projects with the best commercial prospects.
The auditors also found that the European Commission had not tracked closely enough whether the companies involved turned their research into products and services.
Industrial leadership accounted for 22 per cent of Horizon 2020, the EU’s main research programme of that period, with almost 80 per cent of the strand going to six enabling and industrial technologies.
About half of the support went to non-profit bodies such as universities and research centres, even though the funding was meant to carry scientific advances towards the market.
Non-profit participants had their costs covered in full in innovation projects, against 70 per cent for companies. The auditors said the arrangement, which still applies under Horizon Europe, left little incentive to draw in private money.
The report also faulted InnovFin, a risk-finance instrument run with the European Investment Bank Group, because only a small share of its money reached smaller firms and there was too little data to show whether it helped bring products to market.
Grants aimed specifically at small and medium-sized enterprises worked better for technology transfer, though commercial uptake was modest, held back by financing difficulties, regulatory barriers and weak planning for exploiting results.
Neither Horizon 2020 nor its successor, Horizon Europe, sets entry conditions linked to the innovation capacity of applicants, which the auditors said increased the risk that public money would miss the most promising ventures.
Petri Sarvamaa, the member of the Court responsible for the audit, pointed to “a persistent gap between research and commercialisation” and said the next generation of EU research and competitiveness programmes had to narrow it.
The auditors were equally critical of the Commission’s own assessment of Horizon 2020, published in 2024, arguing that assumptions and methodological weaknesses may have produced an overly positive verdict.
The Commission accepted that the data on participating companies was incomplete, though it defended Horizon 2020 as a boost to Europe’s scientific and technological base, to employment and to growth.
It said Horizon Europe, which runs from 2021 to 2027, already used sharper indicators and outside information on the finances of beneficiaries, and acknowledged past limitations in measuring innovation capacity.
The Commission rejected the recommendation to overhaul its monitoring system, arguing that the next research programme and the planned European Competitiveness Fund for 2028-2034 were still under negotiation between the EU institutions.
