The European Defence Fund is a new financial mechanism designed to enable and accelerate cooperation among Member States to better coordinate, supplement and amplify national investments in defence. Through the co-funded European Defence Fund, Member States will be able to achieve greater output and develop defence technology and equipment that may not be feasible on their own, by pooling national resources. The Fund will also foster innovation and allow economies of scale, which will enhance the competitiveness of the EU defence industry. The Fund will have two strands or windows, which are complementary - the Research Window and the Capability Window.
From 2018 to 2020, the EU Commission has allocated €590 million from within existing resources to the European Defence Industrial Development Programme (EDIDP), which is a precursor programme to the EDF. In terms of objectives, the EDIDP and the EDF are broadly similar.
The EDF, which will only come into effect post-2020, will be financed under the next Multiannual Financial Framework 2021-2027. The current level of funding proposed is in the region of €6 billion - which will come from the EU Budget - but this will depend on the outcome of negotiations on the Multiannual Financial Framework. These are currently underway and the proposed funding is subject to further revision. There has been no expenditure to date on the EDF. No funding will flow through the EDF until 2021.
The EDF is an industrial sectoral programme, providing funding for research and capability development, which supports the European Defence and Industrial Technology Base in delivering capabilities for CSDP. In that regard, it is similar to other EU industry and research support programmes, such as ICT, biotech, space etc, funded from the MFF.
My Department continues to work closely with colleagues in the Department of Business, Enterprise and innovation to ensure that Irish interests, particularly in the area of opportunities for SMEs are strongly represented in the work programmes under these funding sources.