WASHINGTON — European Space Agency member states have taken a step towards modifying long-standing policies that award contracts for agency programs based on the size of each country’s financial contribution.
At a briefing June 19 at the conclusion of an ESA Council meeting, agency officials said members had agreed to a “first step” of changes to geographic return, or georeturn, policies for its programs. Under georeturn, funds that member states provide to ESA programs are returned in the form of contracts to companies in those countries.
“This is showing that ESA is evolving. We are evolving towards new conditions,” Josef Aschbacher, ESA director general, said at the briefing.
Some European countries and ESA member states have criticized georeturn, arguing it creates inefficiencies by awarding contracts based on which countries have contributed to programs and in what amounts, rather than who is the best supplier. That causes delays and cost increases, they claim.
Others, though, have warned that doing away with georeturn could undermine ESA programs by reducing the incentives countries have to contribute to those programs. Without a guarantee that their companies will get contracts in proportion to the size of their contribution, countries may be hesitant to provide funding.
The resolution takes a small step towards changing georeturn rules. “We presented a resolution on increasing the flexibility in implementing georeturn at ESA but also streamlining the process,” said Géraldine Naja, ESA’s director of commercialization.
“This is seen as a first step in a more general evolution of industrial policy, taking into account the completely new space context, which requests much more agility and fast decision-making by ESA whilst keeping the principle of georeturn, which has been essential for ESA and has allowed us to build a very strong supply chain in Europe,” she said.
ESA officials didn’t elaborate on the specific changes to georeturn approved by the council in the resolution, but Aschbacher suggested it would be based on a proposal introduced several years ago where ESA would hold a competition for a program, select the winning bidder and only then solicit funding from member states.
“This is something that we would like now to practice on some examples,” he said. The new policy would be started on pilot programs yet to be selected by ESA. “We have yet to identify the right ones but I’m sure we have some good candidates in mind.”
Aschbacher said ESA members approved the resolution after an “intensive” debate. Modifications to georeturn is just one element of the changes proposed by an industrial policy committee, but he did not mention other proposals by that committee.
“There is an openness of our member states to really make adjustments and see what is best for a competitive industry in Europe,” he said. “Having said that, some member states said that this is good. We have made very important progress coming to that step, but maybe we should use it as a stepping-stone for a further evolution and further discussions.”
