PARIS — The European Space Agency (ESA) will freeze its overall spending in 2010 and 2011 at 2009 levels and modify its contract-payment policy to accommodate stresses on the national budgets of some of its 18 member governments, ESA Director-General Jean-Jacques Dordain said Jan. 14.

Dordain said the measures will permit the agency to maintain all the programs its member states have approved in recent years without forcing ESA to take out a loan, while at the same time reducing the near-term cash demands on its member governments.

Addressing a press conference at ESA headquarters here, Dordain said ESA’s annual spending has risen substantially in the past three years and reached 3.35 billion euros ($4.85 billion) in 2009. While the agency’s 2010 budget — a reflection of the new programs ESA governments have agreed to start, and ongoing cash requirements for existing programs — will rise 4 percent over 2009, its total cash outflow will be limited to 3.35 billion euros through 2011.

The figure will not be adjusted for inflation.

“All the programs we have approved will go forward. There will be no cancellations,” Dordain said. “But we will proceed in such a way so as not to cause any payment issues in our member governments. No member states want to renege on commitments already made, but they don’t want me to borrow money and then ask them to pay the associated costs” of a loan.

Dordain said some of the financial pressures are likely to ease as certain space-hardware programs progress less quickly than planned, allowing the agency to postpone cash outlays as a consequence.

For new contracts, ESA will scrap its longstanding policy of paying contractors what Dordain called “a princely sum” at the time of a contract’s signing.

 “Now they will be paid a less-princely sum at the signing of the contract, and a bit more as the contract milestones are reached. That is the solution we are working on with industry.”

ESA’s total budget in 2010, including payments from the European Commission and other outside revenue sources, is 3.74 billion euros, up 4 percent from 2009.


Peter B. de Selding was the Paris bureau chief for SpaceNews.