The European Court of Auditors (ECA) has issued a critical report on the European Commission’s (EC) strategy for artificial intelligence (AI), highlighting significant shortfalls. The report reveals that the EU underspent on AI by €600 million due to delays in the 2021 launch of Horizon Europe.
Key Failings Identified
The ECA’s audit identifies several key issues that have hindered the EU’s AI strategy:
- Lack of Post-Project Checks: There were insufficient mechanisms to monitor projects after their completion.
- Fragmented Management: A disorganised array of departments and agencies were responsible for AI policy, leading to inefficiencies.
- Inadequate Performance Indicators: The EC lacked an accurate overview of funded AI projects, impeding effective monitoring and evaluation.
Mihails Kozlovs, the ECA member who led the review, emphasised the need for the EC to enhance its focus on delivering results. “More than five years after adopting the EU AI plan, weaknesses in implementation and performance monitoring are still evident,” he stated at a press conference.
EU Commission’s Defence
In response, the EC defended its record, rejecting many of the ECA’s proposals. The EC highlighted the establishment of the European AI Office, which aims to enforce the new AI Act and bolster support schemes. Despite these advancements, the ECA’s findings come at a crucial time, as the EU continues to trail the US and China in AI development, particularly in patents and private investment.
Comparative Investment Figures
According to the Organisation for Economic Co-operation and Development, the US led in AI venture capital funding in 2023 with €55 billion, followed by China with €18 billion, and the EU with just €8 billion – a significant drop from 2022.
Historical Context and Strategy Implementation
The audit traces back to 2018 when European governments began releasing ambitious AI plans. The EC’s strategy included significant investments through the Horizon 2020 and Horizon Europe programs. While nearly meeting its spending targets for 2018-2020, the EC fell short by €600 million for the 2021-22 period due to delays in Horizon Europe’s adoption.
Expert Opinions
Robert Praas, an AI specialist at the CEPS think tank, deemed the audit an “accurate assessment” of the EU’s slow progress in AI innovation. He attributed this to a gap between political ambition and implementation capability, suggesting that the EU’s regulatory focus hindered its innovation potential.
Coordination and Fragmentation Issues
The ECA pointed out the absence of a central coordinating body for AI projects, leading to overlapping and fragmented efforts. For instance, three different AI taxonomy projects were funded by various EU bodies without coordination, exemplifying the management inefficiencies.
Performance and Exploitation Challenges
The audit highlighted that while Horizon projects were monitored during their lifetime, post-completion checks were lacking. In many cases, research did not translate into commercial applications. A cybersecurity project on autonomous cars, for instance, failed to commercialise despite an extensive 117-page exploitation plan.
Furthermore, the audit found that per €10 million spent on AI in Horizon 2020, only 0.65 patents were applied for, well below targets.
EC’s Response to Recommendations
The EC agreed to update its AI investment targets considering the rise of generative AI but rejected the ECA’s calls for a new framework for tagging and tracking AI financial support, citing cost and burden concerns. It also dismissed the need for AI-specific performance targets, arguing that existing indicators under Horizon Europe and Digital Europe were sufficient given the fast-evolving nature of AI technologies.
The ECA’s report highlights the need for improved coordination, monitoring, and strategic focus if the EU is to enhance its competitive standing in the global AI landscape.
