The budget proposals put forward by the European Commission on Wednesday 27 May, which cut the EU Space Programme budget to €14.8 billion (as opposed to the €16 billion initially proposed), are causing concern in the European Parliament, notably French MEP Christophe Grudler (Renew Europe, ITRE coordinator).
Admittedly, as the MEP points out to EUROPE, the proposed budget is up from the one put forward at the beginning of the year by the President of the European Council, Charles Michel, who proposed €12.7 billion (see EUROPE 12409/8).
But it remains “a very bad calculation to make savings on the back of space at a time when, at the end of the crisis, the Commission is making the Union’s strategic autonomy a priority”, Mr Grudler confided. He warned that “to reduce the space budget is to acknowledge our dependence on the United States, China and others”, adding that the European Parliament would do everything possible “to get the missing billion or even 2 billion” (the European Parliament had proposed €16.9 billion – see EUROPE 12142/7).
Another European source wondered how the Commission intended to make the budget cuts: would it be in a linear fashion, i.e., a cut of about 7% on all European space programmes (Copernicus, Galileo and EGNOS, GovSatCom and SSA), or would the whole effort to make savings be concentrated on one programme in particular, presumably GovSatCom, the project for encrypted satellite telecommunications for government purposes? Germany, which is about to assume the Presidency of the EU Council, has never shown great enthusiasm for the project and may well propose drastic cuts to the programme.
Recently, Internal Market Commissioner Thierry Breton insisted on the need to help the space sector, which has also been affected by the Covid-19 crisis, through the Recovery Fund (see EUROPE 12496/7).
The problem, we are told, is that the space sector is an economic activity that generates little profit (around 2%). As a result, it is difficult for it to obtain borrowing authority from its shareholders.
One solution would be to consolidate institutional orders considerably to put the sector on a solid footing, “as all major space powers do”. The “Business-to-Business” model promoted by the Commission (where industry is invited to offer services rather than infrastructures), although interesting, will not by itself be able to compensate for the weakness of the European institutional market, our source adds. (Original version in French by Pascal Hansens)