The European Competitiveness Fund and the 2028 to 2034 Budget: What Changes for Technology Funding
Every EU funding programme you can currently apply to expires at the end of 2027. What replaces them is being negotiated now, and the shape is substantially different from what exists today.
The Commission proposed the next Multiannual Financial Framework on 16 July 2025, covering 2028 to 2034, at close to €2 trillion, around 1.26 percent of EU gross national income on average across the period. For technology, two things in it matter: a new European Competitiveness Fund that consolidates a large number of current instruments, and a successor research framework programme with a proposed budget nearly double the current one.
If you plan technology investment on a multi-year horizon, this matters more than the tail of the current programmes.
The problem it is trying to solve
The diagnosis comes largely from the Draghi report on European competitiveness, which argued that Europe under-invests in innovation, spreads what it does invest across too many small instruments, and takes too long to get money to recipients.
The specific complaints about the current structure are well documented and mostly fair:
Too many programmes. A company doing strategic technology work has to identify which of a dozen instruments fits, each with different rules, different portals, different reporting and different timelines.
Fragmented rulebooks. Eligibility, cost rules and co-funding rates differ between programmes for no reason a beneficiary can see.
Slow disbursement. Six to twelve months from call to grant agreement is normal, and longer is common. For a scaling company that is a very long time.
No continuity across the innovation journey. Research funding, deployment funding and scale-up capital sit in different instruments with no path between them.
What the European Competitiveness Fund does
The proposal consolidates a large set of current instruments into a single fund with one rulebook and one gateway for applicants. The stated purpose is to invest in strategic technologies across the single market, simplify and accelerate funding, and catalyse private and public investment.
Following the Draghi recommendations, the fund is organised around a small number of strategic areas:
Clean transition and decarbonisation. Net-zero technology, energy, industrial decarbonisation.
Digital leadership. AI, semiconductors, quantum, connectivity, cybersecurity, advanced digital technologies.
Health, biotech, agriculture and bioeconomy.
Defence and space.
Alongside a cross-cutting emphasis on resilience and security.
The Council agreed its position on the fund in June 2026, which means the shape is becoming clearer, though the total allocation and the balance between areas remain live negotiation.
What happens to Horizon Europe
The successor framework programme keeps the Horizon Europe name and remains a standalone programme rather than being absorbed into the Competitiveness Fund. The proposed budget is around €175 billion, close to double the current €95.5 billion.
The intended relationship is that Horizon Europe covers research and early innovation, the Competitiveness Fund covers deployment and scale-up, and together they support a project from conception to commercialisation without the beneficiary having to change instrument, portal and rulebook halfway through.
Whether that works in practice depends entirely on implementation, and the history of European funding simplification promises is not encouraging. But the intent is clear and the structural change is real rather than cosmetic.
What this means for planning
The current programmes still run
This is the most important practical point and it is frequently confused. Horizon Europe, the Digital Europe Programme, CEF and the rest run to the end of 2027, with projects funded under them continuing for years afterwards. Nothing stops.
The 2026 to 2027 work programmes are the last full cycle under current rules and they are substantial. If something fits, apply now rather than waiting for the new structure, because the new structure will take time to become operational and early calls under new programmes are always slower and less predictable.
There is usually a gap
Between the end of one framework and the first calls under the next, there is typically a lull. Programmes need adoption, work programmes need drafting, systems need building. Planning that assumes continuous funding availability across the 2027 to 2028 boundary is optimistic.
If your organisation depends on grant income, that transition is a cash flow risk worth modelling now.
Consolidation may not simplify your life
Merging many instruments into one fund with one rulebook sounds like simplification. In practice it can mean that instruments with different logics, different beneficiary types and different risk appetites are forced into a common framework that suits none of them well.
The specific risk for smaller organisations is that a consolidated fund with a single rulebook tends towards the administrative requirements of the largest instrument. Watch whether simplified cost options and lighter regimes for small beneficiaries survive the negotiation.
The strategic areas tell you what will be funded
The four areas are a clear statement of priority, and they are noticeably narrower than the current spread. Work that fits digital leadership, clean transition, defence or biotech is well positioned. Work that does not is in a weaker position than it is today.
If your technology sits outside those areas, the honest planning assumption is that European funding availability for it will decline after 2027.
The politics, and why numbers will change
The proposed figures are a starting position, and the Multiannual Financial Framework negotiation is the most contested process in European politics. It requires unanimity among member states plus European Parliament consent.
Several structural tensions will move the numbers:
Net contributors want a smaller total. They always do, and several have said so explicitly.
Cohesion and agriculture defenders resist reallocation. The proposed restructuring shifts money away from traditional cohesion and agricultural envelopes, and the constituencies for those are powerful.
Defence is expanding rapidly, and defence money has to come from somewhere.
Repayment of the recovery instrument starts consuming budget headroom during this period, which is a real constraint that did not exist in previous frameworks.
The historical pattern is that final MFF totals come in below Commission proposals. Treating €175 billion for the research programme as a firm number would be unwise. Treating it as evidence of intended direction is reasonable.
What to actually do
Apply under the current programmes while they exist. The 2026 to 2027 work programmes are large and the rules are known. This is a better bet than waiting.
Model the 2027 to 2028 transition if grant income matters to your finances. Assume a gap.
Check whether your work fits one of the four strategic areas. If it does not, and European funding is part of your strategy, that is worth knowing now.
Watch the Council and Parliament positions rather than the proposal. As with legislation, the overlap between co-legislator positions is the reliable signal.
Do not restructure your organisation around an unadopted budget. The timeline is long and the numbers will move.
Where this fits
The current landscape, which is what you can actually apply to, is mapped in our EU technology funding guide. The individual programmes are covered in our guides to Horizon Europe, the Digital Europe Programme, the EIC Accelerator and STEP, which is the transitional coordination layer the Competitiveness Fund is designed to replace properly.
Getting help
We build software for companies across Europe, including organisations whose work is grant funded. Where we are useful is delivery: building the technical work, producing reporting evidence as a by-product of normal engineering, and making sure what gets built outlives the funding period.
We are not grant consultants. If you have funded work that needs delivering, or a research output that needs to become a maintainable product, write to office@c9group.dev. More about our work on the EU market entry page.