From: British National Space Centre
Posted: Tuesday, July 29, 2003
The UK welcomes the Green Paper's important questions and its consultation process as an opportunity to influence debate on the future of the European Space Sector. Space is vital at a European level for information and communications systems, policy delivery, service provision and research. This response stresses the importance of a user-focused approach in all areas, and foresees no increase in public spending on space-related RTD without this. It recognises the need for positive action at a time of rapid evolution of the European space sector, but notes that space is not a "special case" as regards competition rules or free market forces, including in the sphere of industry restructuring and launcher capability. Equally, it notes the need for positive action as regards the evolution of institutional arrangements, stating the case for a review for the European Space Agency's and the European Union's internal rules, roles and external methods of cooperation, and how these might best complement each other. In the context of changes to funding mechanisms, it notes that the introduction of funding by the European Union, other than user-led, would be likely to be accompanied by an corresponding decrease in Member States' investments, and stresses that it would be unacceptable for the financial responsibilities incurred by States on optional ESA programmes to be transferred to European Institutions. It recognises the defence capability of space systems and notes that the need for such assets must be assessed against other means of intelligence and information collection, and be prioritised alongside other important improvements that are required to European military capabilities. It notes that, while the provision of military capability remains a Member State responsibility, space systems could potentially be put to the service of a European CFSP. These positions are in keeping with the pragmatic and user-oriented nature of UK Space Policy as outlined in the ‘UK Draft Space Strategy: 2003-6'.
Manufacturing, operating and exploiting space systems [Q1,2,3,11] Europe needs access to space systems to meet the needs of its governing institutions to develop and deliver policies; to meet the needs of commerce for access to competitive information and communications infrastructure; to conduct fundamental and applied research; and to provide its peoples with services they require or desire.
In many of these areas, space systems are integrated seamlessly with terrestrial systems. In some the two are alternatives, even competitors. The purpose of a European space strategy is to deliver assured access to these systems for European institutions and citizens and to facilitate the maximum economic benefits for European companies from supplying European and international markets with products and services. In some cases European regional systems are part of a global system and depend on co-operation arrangements for the exchange of information. The World Meteorological Organisation and the International Global Observing Strategy are two examples of this.
Access may be assured through a number of policies which might be market-driven or government directed and funded; based on indigenously developed technologies, licensed technologies or imported technologies. Experience to date suggests that most space systems involve a mixture of these features either over time or across the system - upstream and downstream, hardware, software and content. These fundamentals apply equally to launchers as to any other part of space systems: policy assessments must be made rationally on a case by a case basis and reviewed periodically. At the margins of launcher policy, this has been recognised in Europe over the recent past, as evidenced by the Starsem and Eurockot associations with East European launcher manufacturers, preliminary agreement with Russia on Soyuz operating from the Centre Spatial Guyanais at Kourou and identification of possible non-ESA sources for future launcher technologies. Most European satellite operators and institutions have relied for launch services on the market, in which Arianespace has been the most successful supplier, with the Ariane 4 offering.
Europe should now evaluate a range of options for maintaining access to satellite launch capacity until 2020 to assess costs, benefits and risks. Such studies should involve independent expertise on markets, economics and European law, as well as technology. Options should fully investigate the scope for sharing development or operational costs with the full range of potential collaborators, and entering into reciprocal "guaranteed access" agreements. [Q1]
The European Space Agency (ESA) has undertaken a survey of critical technologies, and identified both shortcomings and unnecessary duplication, under the heading of ‘The European Technology Master Plan' and ‘Technology Harmonisation'. [Q2]
Many of the motivations for restructuring in the space industries globally, and many of the consequential risks, are no different from those affecting other high capital value, RTD-intensive industries: economies of scale in research and development, in marketing and in financial engineering. This restructuring has also largely mirrored concentration in the telecommunications industry, including satellite operators. The risks to customers are the potential anti-competitive effects of concentration where it leads to a dominant position. However, this is a matter for the competition authorities with jurisdiction over the relevant transactions. Moreover, the demand side of the market is considerably distorted by existing policies on both sides of the Atlantic, as well as in certain other markets, that favour indigenous companies. [Q11]
Public sector investment in space-related RTD in Europe is likely to be fairly static in the coming years. This reflects budget stringency across Europe, designed to maintain fiscal rectitude and so promote economic growth. Growth in the institutional market will therefore depend on space systems, and particularly satellite services, demonstrating that they are the most cost-effective way of meeting public objectives for policy development and service delivery. The procurement of the operational Galileo system is one such example, the exploitation of Earth observation data through the Global Monitoring for Environment and Security programme another. It has been a key objective of the Commission in producing the Green Paper, and in the preceding work with the European Space Agency and the Member States towards an integrated European Space Policy, both to stimulate demand in these areas and to ensure that user-orientation is strengthened among the space industry and space agencies. Expansion of the institutional market, within the overall constraints of public expenditure at national and EC level, is therefore to an extent dependant on the success of the process in which the Green Paper is a key part. Success is not a foregone conclusion: it will require sustained effort by all players. [Q3 and Q11]
Recent discussions on the consequences of the market downturn have generally shown a mature recognition that governments should not, and are not in a position economically, artificially to inject additional funding into the sector. Improving the extent to which the actions of public bodies support competitiveness in the space industry will require doing things differently or doing different things, while remaining within existing resources.
There can be a tension between promoting competitiveness and ensuring that investors share benefits in a balanced way. The Technology Harmonisation programme entails an element of rationalisation of capabilities which Europe has duplicated under past industrial policy, which with hindsight can be seen to have been wasteful. There are fundamental flaws in current ESA industrial policy in that the benefits of space programmes have effectively been narrowly defined to equate to the direct industrial development contracts involved and attempts to ensure a fair return have been increasingly inflexible, with little margin for divergence allowed and calculations made on a programme by programme basis.
The ESA is not alone in seeking to achieve a geographical spread of benefits: the European Community has regard to a fair return and the US civil and defence space authorities appear to avoid excessive regional concentration of publicly funded research facilities and development and procurement contracts with industry. It is at least arguable that the inflexibility in ESA industrial policy is already damaging to competitiveness. If the membership of the ESA grows in line with that of the European Union or if co-operation between the two institutions expands, the system will strain to breaking point. It is now time to review the definition of benefits from space programmes and develop more realistic expectations among Member States about how exact such calculations can be over the short-term. [Q11]
In the long-term, the ability of a branch of the economy to attract and retain skilled employees depends on a number of factors, including the intrinsic attraction of the work, the remuneration offered and the prospects for advancement. Research among undergraduates in the UK has shown that space and astronomy are two out of the three areas for study which are most likely to attract young people to an early interest in science or engineering, the third being dinosaurs. Space has proved a beacon subject in science and many universities offer it in combination with a number of other disciplines.
After a period of significant growth, the European space industry has contracted over the past year or so, in line with global markets. There has also been consolidation of Europe's scattered expertise. While the space manufacturing industry is laying off staff, the issue of how to make professions associated with the industry more attractive may not arise in practice. Realistically, such uncertainty will reduce the attraction of a career in any industry. However, there may be scope for identifying whether the picture is a more positive one in the downstream and service industries, including public sector bodies, and give due publicity to this. Retraining within the industry may also be an important issue on which to focus. [Q6]
Institutions [Q5, 9, 10]
In the 30 years since the European Space Conference which led to the establishment of the ESA, the size and nature of the European Communities have changed substantially. The European Council has invited the Convention on the Future of Europe to advise on a possible new treaty and current draft articles suggest that space be identified specifically among the competences of the Union and would assign responsibility to the EU to draw up a European space policy. In due course, the United Kingdom will adopt a position on the draft treaty, as will all Member Sates. It might be misleading to comment on a single aspect of the draft in isolation. It is, however, possible to discuss some general principles which may be taken into account.
Satellite-based technologies can provide tools for delivering a number of Community policies, for improving the productivity of firms and the public sector and help pursue the Lisbon agenda. This has been most clear in areas such as the Framework RTD programmes, the Information and Society Programme, transport (navigation), environmental and agricultural monitoring. In this sense, the Community has competence in space and this has, to date, met the needs of the Member States. At the same time, the ESA has the powers needed to develop capability and pursue scientific research, as well as to conduct third party programmes under contract or agreement. It has an established track record in developing the space sector which the Community lacks. The two organisations therefore need each other, and should continue to draw on their complementary strengths.
A European Space Policy also has to take account of other institutional operators and users of satellite systems. The European Organisation for the Exploitation of Meteorological Satellites (EUMETSAT) runs operational Earth observing systems, in conjunction with international partners as part of a global system and delivering real time information and forecasts by combining satellite information with other sources through the process of data assimilation. It also has experience of collaborative working with the ESA and exploiting both the scientific and engineering advances achieved by ESA.
It would clearly not be in the interests of the Member States in either the EU or the ESA to extend the EU's powers in a way which could result in overlapping programmes and objectives, or conversely encourage one organisation to withdraw from a key activity in the unfulfilled expectation that the other would take on this role. There could be further risks in separating out support of underpinning space research from wider European research in the Framework Programme, which could damage efforts towards better European integration of research efforts.
The current objective for most Member States is to see the Commission and the ESA Executive working together as if they were part of the same organisation. However, it would be premature to commit to any step now which went further than this.
For the immediately foreseeable future, the Commission and the Director General should revive the close working arrangements which were foreseen when they established the Joint Task Force but which have to an extent been in a hiatus during the negotiation of the Framework Agreement. [Q5, Q9 and Q10]
So far as funding is concerned, as noted above, expansion of public investment in space should be based on demonstrable additional value for policies and services and evaluated against alternatives methods for achieving similar objectives; environmental monitoring and broadband internet services with satellite return are promising areas for study. One could go further and note that, if current investment purely in space RTD is regarded by European governments to be at the optimal level in relation to competing demands for public resources, financing at a European level of activities currently funded by Member States would inevitably result in matching reductions at national level. This issue of substitution can be overcome if proponents of utilising space for Community objectives to provide a firm evidence base that space can offer added value, for example as discussed above, by demonstrating a connection to the Lisbon agenda. If it is possible then to justify investment in bold, imaginative projects, this will help to capture the imagination of European citizens, as well as boosting confidence among the space industry. Galileo is an example of this. [Q5]
Regulatory regime [Q12]
The impact of regulatory barriers on the development of new satellite communications services is an area of study for the EU's Satellite Action Plan (SAP) REG Group which was established pursuant to the SAP. This group has worked closely with the ESA, as well as with the Satellite Regulation Project Team of the Conference of European Postal and Telecommunications Administrations (CEPT). The CEPT has introduced a number of initiatives aimed at harmonising regulation in Europe and reducing unnecessary red tape. The UK will encourage the maintenance and development of this fruitful working relationship between the CEPT and the European Community. The value of the harmonisation and deregulatory initiatives which have resulted from this co-operation in Europe is demonstrated by the way in which other regions for example, CITEL (Americas) and regulator groups in Africa and Asia-Pacific, are mirroring these actions. [Q12]
The UK legislated in 1986 to ensure that it could comply with its obligations under UN Treaties and Conventions on the use of Outer Space. As other Member States introduce comparable legislation, there is a risk that industry will become subject to diverging regulatory requirements, involving unnecessary costs. Each sovereign State has a clear right to legislate in the optimum way to protect national interests falling within national competence. However, there might be advantage to regulators and commercial entities if States were to exchange information on the requirements they place on non-government bodies which launch, procure the launch of, or operate, space objects. There may be a role for the EU in facilitating such exchanges and promoting discussion amongst regulatory authorities.
Common Foreign and Security Policy [Q8]
In deciding how best to define and clarify those space capacities required under the CFSP, and in particular ESDP, it will be important to consider the need for space-based assets in the context of the wider improvements to capabilities that have been identified through the European Capability Action Plan. There are many important candidates for EU capability improvement under ESDP, and the need for intelligence and information-gathering capabilities, including space-based options, need to be prioritised alongside these. Before addressing how to meet these needs most effectively, a robust process must be followed, beginning with a full analysis of the EU's requirements for intelligence and information in support of CFSP and crisis management operations. Space-based capabilities might form part of the answer, but other steps will also need to be carefully examined, such as increasing nations' provision of information to the EU. An overarching view needs to be adopted that takes account of the full range of capability improvements. The question is how best the EU can get assured access to information, not necessarily how it should develop new systems.
As the Green Paper notes, the provision of military capability will continue to remain within the remit of Member States, and the ESDP initiative is first and foremost aimed at improving nations' capabilities so that these can be made available to the EU for crisis management operations. In many cases, therefore, Member States will wish to continue to exploit and enhance space-based systems through national, bilateral or other existing mechanisms. The autonomy of the EU to conduct military operations is not compromised or limited if one or more Member States decide to supply intelligence through nationally recognised and selectively sourced means. The overall EU institutional arrangements, and any EU Space Policy, need to reflect this, whilst recognising that increased co-operation between nations, the EU and NATO would lead to more effective use of space-based systems for security applications. [Q8]
International Space Station [Q4]
A number of ESA Member States have committed substantial funding to developing the International Space Station (ISS). They have also accepted continuing obligations to support the running costs of the station. Motivations for these investments may vary. The UK took the decision in 1987 that the scientific and commercial benefits from investing in the ISS would not be justified. Reviews of this policy at intervals have not caused us to change that assessment.
Nothing should be done to transfer to European institutions these continuing obligations, away from those nations which entered into them.
If one accepts that there is no opportunity to renegotiate further these obligations, it may be that the nations concerned will decide to regard them as sunk costs, which must be met whether or not they make use of the facilities on the station. On that basis, it would be legitimate to judge proposals for the utilisation of the ISS solely on the basis of marginal costs of the experiments. This is the basis on which the UK evaluates proposals from experimenters. To date, there is little evidence that, even on this basis, large-scale utilisation is attractive to the scientific or industrial communities. [Q4]
The Commission has promoted wide debate on the Green Paper, on the internet and in workshops across Europe. Some of the arguments put forward in these in support of conducting research on the ISS are predicated on the need to prepare for human spaceflight to Mars. The UK does not consider that such arguments provide a convincing scientific or economic case for Europe expanding its expenditure on the ISS or its exploitation.
United Kingdom July 2003
THE GREEN PAPER QUESTIONS
Q1: Should Europe maintain, until 2020 and beyond, its independent access to space, based on the development of a family of European launchers and their preferential use by institutional users? What should be the formula for a wished-for evolution in the sharing of responsibilities between the public authorities and the private sector in the economic balance of the use of these launchers and in the finance of new developments?
Q2 : In which fields - including those concerned with space systems used for security and defence - does Europe have critical technology and industrial short-comings, and how to redress the balance?
Q 3 : What is the outlook for growth in the European institutional market? In parallel, is it necessary to seek agreement with key international partners (United States, Russia) to establish more balanced market conditions?
Q11 : Economic pressures are driving aerospace industries in Europe and elsewhere to restructure. What are the consequences of such restructuring? How may the actions of public bodies be best organised to support the competitiveness of the space industry?
Q5 : How may the financing of space activities at European level be organised in a more coherent manner, avoiding that an increase of resources at European level is accompanied by an equivalent reduction of investment at national level?
Q9 : What is the most efficient manner to exploit the space "acquis" in Europe for the benefit of Union policies?
Q10 : How may the political and juridical bases necessary for an efficient action by the Union and Europe in the space field, in particular with regard to the definition of the future Treaty of the Union, be reinforced? [also linked to Q5 and Q9]
Q12 : Are there regulatory barriers, which slow the development of new space communication services? What are the measures likely to improve regulatory environment notably with a view to the development of the information society?
Q8 : How better to define and clarify, as part of a coherent whole (including framework and time-scale): the nature and scale of the space capacities required to achieve the political objectives of the PESC [Common Foreign and Security Policy]? Within what context the possible new space capability may be placed at the service of the security of citizens?
Q6 : What action should be taken in space professions and associated field to make them more attractive, in particular to young people?
Q7 : What are the conditions for the emergence of economically viable and competitive applications and space services for citizens and industries? Will political actions be justified, and if this is the case, to what extent could public support be considered necessary?
Q4 : From a European point of view, do the results eventually expected from the experimental programme on board the ISS correspond to the level of investment and the running costs? How should Europe develop its participation and its objectives?
For original source see: http://europa.eu.int/comm/space/futur/greenpaper_en.html
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