The EU does contribute to free software to some extent. But not enough.
At least 7% of Linux contributors are in Germany+France. An extra 2% from the UK. This is probably underestimated since the source has country info on only half of contributors. https://insights.linuxfoundation.org/project/korg/contributors?timeRange=past365days&start=2024-10-06&end=2025-10-06
The EU commission funded free software via NGI, and indirectly via NLnet. It's a great initiative helping many small projects, but its future is incertain. https://nextgraph.org/eu-ngi-funding/