Funding for increased participation in EU projects (RETUR-EU)

The EU funding policy is based on the fact that research organisations have significantly higher basic funding than Norwegian institutes. To ensure that Norwegian institutes can still afford to participate in EU projects, the Norwegian authorities have introduced a scheme for EU performance-based basic funding for research institutes – Retur-EU. The scheme compensates for some of the gap between EU funding and actual costs.

The research institutes account for a large part of Norwegian participation in HEU projects. The purpose of Retur-EU is to ensure that Norwegian institutes can participate in more such projects. The scheme functions as a performance-based basic allocation.

Which institutions does the Retur-EU apply to?

The Retur-EU applies to all institutions listed on  the Research Council's list of approved research organisations, either under the heading "Organisations covered by the Government's Strategy for Comprehensive Institute Policy, including organisations covered by  the Guidelines for State Basic Funding of Research Institutes and Research Groups" or under the heading "Other entities in the public sector that are required to carry out research and other approved research organisations". In the following, all of these are referred to as "institutes". 

Aid rate and disbursement

Awarded funding from Retur-EU scales with the institutes' grants from Horizon Europe. The funds for a given year are paid out in three equal instalments distributed over the following three years after the EU projects were established.

• For research institutes covered by the Guidelines for State Basic Funding, the Return EU accounts for between 33.3 and 50 % of total EU funding. See "Calculation of differentiated share" below.
• For other approved research organisations, Retur-EU accounts for 33.3% of total EU funding.

The allocation from Retur-EU may not be higher than the institute's total income from the EU and Retur-EU does not exceed the institute's real, actual costs for implementing the EU projects.

In the revised national budget for 2024, the previous year's upper limit for the scheme of NOK 500 million was repealed. The same method as in 2022 and 2023 for calculating the aid intensity will therefore be continued, at least in 2024. The need for funding will vary from year to year due to the changing content of the HEU calls and the success of the institutes. The Research Council is therefore in continuous dialogue with the Ministry of Education and Research on how Retur-EU should be financed.

Guidelines for the use of funds allocated from Retur-EU and reporting

Funds from Retur-EU must be used in accordance with  the Guidelines for central government basic allocations to research institutes and research groups, cf. section 5.3 Allocation of basic allocations. This also applies to institutes that are not covered by these guidelines. Institutes covered by the guidelines will receive Retur-EU funding as a supplement to the basic allocation. Other institutions that are eligible for support from the scheme will receive the funds through a separate grant letter.  

The institutes must report on the use of the funds within a specified deadline.

Such HEU projects qualify for Retur-EU

The Research Council calculates the grants from Retur-EU for a given year at a time based on updated figures in the EU project database eCorda on the European Commission's contribution to approved project costs.

The main rule is that all project types in Horizon Europe trigger Return EU, including:

• Research and Innovation Actions
• Innovation Actions
• Coordination and Support Actions
• Marie Sklodowska-Curie Actions
• European Research Council
• European Innovation Council

Exceptions may apply. The Research Council's assessment will then be based on whether the institute has a real need to cover costs in the projects. For projects that receive partial funding from European Partnerships under Horizon Europe, the European Commission's contribution may also qualify for funding from the scheme.  

Retur-EU is not triggered for projects funded by co-funded partnerships or by costs related to membership of European Partnerships. Grants that cover the institute's real, actual costs do not trigger Retur-EU either.  

Collaboration with the business community and the public sector, as well as project coordination, provides extra benefits

The Retur-EU also includes funds to stimulate institutes to cooperate with Norwegian business and industry and the public sector and to coordinate EU projects. The annual framework amounts to 8% of the Retur-EU amount triggered by new projects in a given year (cf. the section above), divided by 4, 2 and 2 percentage points respectively between cooperation with Norwegian business and industry, cooperation with the public sector and coordinator responsibility.

These funds are in addition to the payments from Retur-EU described above, provided that the institute's total income from the EU and Retur-EU does not exceed the institute's real, actual costs for carrying out the EU projects. They are distributed proportionally to the departments' EU allocation in the projects that qualify. Payment is conditional on the actors from the private and public sectors being partners or coordinators in the EU project.

Calculation of differentiated share

The differentiation only applies to institutes that are covered by the Guidelines for central government basic allocation. It is linked to the department's cost level (reflected in the department's hourly rates) and only applies to departments where the basic allocation amounts to less than 17 % of net R&D operating revenues. (Net R&D operating revenues are operating revenues excluding revenues transferred to others, less financial income and other income.) Note that the Research Council calculates the basic grant's share of net R&D operating revenues as an average of the last 3 years, where the last year counts double.

The individual institute's support rate is equal to the product of two factors, called A and B (support rate = A x B), limited upwards and downwards to 50 and 33.3 % respectively (of total EU support).

• The factor A is a ratio equal to the department's weighted hourly rate for researchers divided by the average weighted hourly rate for researchers in the fifteen departments with the highest weighted hourly rate for their researchers, but is limited upwards to the number 1. The factor A is thus equal to 1 for institutes with a relatively high cost level, somewhat lower than 1 for institutes with a relatively low cost level. The weighted hourly rate for a department's researchers is calculated based on the department's reported (and budgeted) hourly rate, the number of full-time equivalents and the expected number of invoiced hours per researcher for the department's various categories of researchers.
• The factor B is equal to 50 % for institutes where the basic allocation amounts to less than 13 % of net operating revenues and equal to 33.3% for institutes where the basic allocation amounts to more than 17 % of net operating revenues. In the interval where the basic allocation is between 13 and 17 %, B varies linearly from 50 % to 33.3 %. In this way, we get a smooth transition of around 15 % so that institutes that one year are just below (or above) and the next year just above (or below) this limit for the basic grant's share of net operating revenues, will not have a very large change in the allocated support rate from one year to the next.