Brussels, 10 June 2014
Commission points to innovation reforms to sustain economic recovery
The European Commission has today highlighted the importance of research and innovation (R&I) investments and reforms for economic recovery in the European Union, and made proposals to help EU Member States maximise the impact of their budgets at a time when many countries still face spending constraints. Increasing R&I investment is a proven driver of growth, while improving the efficiency and quality of public R&I spending is also critical if Europe is to maintain or achieve a leading position in many fields of knowledge and key technologies. The Commission has pledged support to Member States in pursuing R&I reforms best suited to their needs, including by providing policy support, world-class data and examples of best practice.
Olli Rehn, Vice-President of the European Commission responsible for Economic and Monetary Affairs and the Euro, said: “The European economic recovery is gathering speed while the pace of fiscal consolidation is slowing down, in line with the EU’s reinforced fiscal framework. Nonetheless, budgetary constraints will remain, which is why.it is more important than ever that Member States target their resources smartly. The EU budget is helping drive growth-enhancing investment in research and innovation and today we are putting forward ideas to help maximise the impact of every euro spent.”
Máire Geoghegan-Quinn, European Commissioner for Research, Innovation and Science, said: “Fostering innovation is widely accepted as the key to competitiveness and better quality of life, especially in Europe where we cannot compete on costs. This is a wake-up call to governments and businesses across the EU. Either we get it right now or we pay the price for years to come.”
The Communication published today highlights three key areas of reform:
Improving the quality of strategy development and the policy-making process, bringing together both research and innovation activities, and underpinned by a stable multi-annual budget that strategically focuses resources;
Improving the quality of R&I programmes, including through reductions of administrative burdens and more competitive allocating of funding;
Improving the quality of public institutions performing research and innovation, including through new partnerships with industry.
The Commission has also called on Member States to prioritise R&I, as public authorities regain margins for growth-enhancing investment. With current R&I spending across the public and private sector worth just over 2% of GDP, the EU remains well behind international competitors like the United States, Japan and South Korea, with China also now very close to overtaking the EU (see graph). Increasing R&I spending to 3% of GDP therefore remains a key target for the EU, but the Communication today shows that improving the quality of public spending in this area is also essential in order to increase the economic impact of investment. The Communication points equally to the need for the EU needs to put in place the right framework conditions to encourage European companies to innovate further.
Public and private R&D intensity in 2012 in the EU and some third countries
Innovation is central to economic growth and business competitiveness, and is at the heart of the EU’s Europe 2020 strategy. Today’s proposals follow those of the 2014 Country Specific Recommendations where a number of Member States received recommendations to reform their research and innovation policies. The Commission has also issued today a State of the Innovation Union report demonstrating progress against the 34 commitments made and highlighting the need for further efforts.
The EU budget for 2014-20 marks a decisive shift towards R&I and other growth enhancing items, with a 30 % real terms increase in the budget for Horizon 2020, the new EU programme for research and innovation. A further EUR 83 billion is expected to be invested in R&I as well as SMEs through the new European Structural and Investment Funds.
Innovation Union: http://ec.europa.eu/research/innovation-union/index_en.cfm
Horizon 2020: http://ec.europa.eu/programmes/horizon2020/