One of the most contentious parts of the torturous post-Brexit trade negotiations between the UK and Europe was the dispute-resolution process. Now it’s being tested. The UK triggered the measure last week, complaining that the European Union has blocked its access to billions of science funding in retaliation for Britain’s plan to rip up parts of the trade arrangement for Northern Ireland. Tit, meet tat.
The timing should tell you everything. The frontrunner to replace Boris Johnson, Liz Truss, is also in charge of Brexit matters. A quarrel with Brussels is a tried and tested way of appealing to Tory voters.
As with the entire Brexit debacle, the dispute perfectly captures how the UK’s hardline approach quickly hits the wall of economic and political reality. In this case, the price for Britain’s scientists and researchers will be high: They’re at risk of losing access to the largest science funding program of its kind anywhere, a near $100 billion pot called Horizon, along with a range of other research programs such as Euratom, which engages in nuclear innovation; Copernicus, the Earth observation effort, and space programs.
Officially, science has nothing to do with product checks in Northern Ireland. Unofficially, of course, it’s all linked. The goal at the time of the UK-EU trade deal was that the UK would become an associated member of Horizon. But the EU held up the Horizon association agreement after Johnson’s government declared its intention to unilaterally rewrite the terms of the divorce that relate to trade on Northern Ireland. The bloc isn’t kidding, either — it has previously shut out Switzerland from the funding program over other bilateral disagreements.
The dispute process triggers 30 days of consultation after which it would go to arbitration. If the EU is found to be in breach of the trade agreement and doesn’t comply, the UK can seek compensation; if the EU refuses to pay compensation, then the UK can pursue specific trade remedies.
There are a number of potential off-ramps before it comes to that. But, as Zach Meyers, a senior research fellow at the Centre for European Reform notes, a lot of the damage has already been done. While both sides suffer from this dispute being dragged out, it’s the UK, as with most Brexit matters, that has more to lose.
The Horizon program (the current incarnation, Horizon Europe, runs from 2021 to 2027) has funded collaborations that have led to advances in medicine, better understanding of Covid-19, improvements in leukemia treatment and innovations in hydrogen cells to fuel zero-emission buses, among other achievements. Before Brexit, more than a third of UK research papers were co-authored with European scientists. Association status would allow UK participants to apply for grants on the same basis as EU applicants, and lead international teams.
Brexit has already had a substantial negative impact on UK science. It has meant the departure of scientists and researchers who felt unwelcome or who needed to transfer to the EU to ensure access to funding. The UK’s annual share of EU research support fell by almost a third between 2015 and 2019. Before the Brexit referendum, the UK was receiving 16% of Horizon grants in monetary terms; by 2018, it was just 11%. Some 115 grants from Horizon were terminated in July because of the current row.
No problem, said Johnson; we’ll just replace the funding. Last month, the government rolled out its Plan B, which at least suggests the roughly £15 billion ($17.7 billion) set aside for Horizon over the next decade won’t be funneled to other pressing needs. Britain did a similar thing when it left the EU’s Erasmus student-exchange program and created its own “Turing” plan.
And yet in both cases, the UK version is a poor substitute for the original. Meyers notes that while the UK was getting more out of Horizon in financial terms than it was putting in, it’s the qualitative elements that signify the bigger loss. Horizon’s sheer breadth and prestige meant a lot of economies of scale, including lower overhead than for standalone programs. New partnerships take a while to establish and could be more complicated; regulatory alignment between the UK and EU made collaboration easier in areas like animal testing.
The UK has long been a laggard in R&D spending. And despite having some of the world’s top research universities, too little innovation seems to have been commercialized. It’s also expensive for foreign researchers to get visas and move to the UK.
“It’s in the UK’s interest to make it look like these are alternatives to EU programs, but the reality is they aren’t,” Meyers says. A plan B is better than no plan at all. But setting up a unilateral scheme and saying it’s as good as a multilateral one was always going to require a bigger leap of faith than the government has a right to expect. The UK can still participate in some programs on a “pay-to-play” basis, which will just increase costs for less benefit.
Once in office, if indeed her frontrunner status is confirmed, finding an off-ramp would be the wiser option for Truss. She can talk tough now to win votes, but getting an association deal with the EU would do a lot more to demonstrate seriousness about productivity improvements and growth.
Bloomberg
