As part of the Europe 2020 Strategy, the European Union is seeking to transform itself into an Innovation Union. Europe has a large ageing population and this along with pressures from globalisation show the need for innovation that will precipitate a step change in the way Europe produces products and services.
The Innovation Union strategy has 30 action points that aim to create more jobs, improve the standard of living, and maintain competitiveness in the global market.
There are three main goals tied to the Innovation Union. The first is to turn Europe into a leading actor in the science industry. This will be achieved by loosening restrictions on research currently in place and by providing better targeted funding. While the EU has the largest research budget in the world, it fails to bring new and innovative products to the market. Part of the problem lies with the EU citizens’ attitudes toward research and our bureaucratic system of promoting research.
Some studies indicate that Europeans, particularly compared to Americans, tend to favour safety over taking risks. This culture must change if the EU is to become a global leader in research. Yet, members of the EU’s scientific community have argued that while they perform good research, much of it is pushed aside and never properly promoted to reach the product or services stage. Another problem lies with the bureaucracy that governs research funding. For example, researchers are often given funding to explore a specific topic, but if the research deviates from that topic to something else, however potentially useful, the funding will be retracted.
The Innovation Union strategy aims to tackle such inherent problems in our research system with initiatives like the ‘European Research Area’, which encourages cooperation among EU member states through knowledge-transfer. The most concrete plan for improvements in research and development (R&D) is the 2007-2013 Seventh Framework Programme (FP7). This policy will provide funding for research collaboration, the establishment of a Research Council in order to produce new ideas, more scholarships and fellowships for researchers, and upgrades to current infrastructure.
To remain competitive, the Innovation Union strategy calls to spend more money on R&D and to close the gap between the EU and competitors like the US, Japan and, increasingly, several emerging markets. Another point of concern is the fact that the EU spends 0.8% of GDP less than the US every year on R&D. The changes proposed are of utmost importance if the EU plans to achieve its goal of investing 3% of EU GDP on R&D by 2020. Such action will also create approximately 3.7 million jobs and is forecast to boost the Union’s annual GDP by €795 billion by 2025.
The second goal is to revolutionise the way public and private sectors interact with one another. One of the 30 action points in the Innovation Union strategy is the creation of Innovation Partnerships, which are a way to tackle key societal changes, like the large ageing population in the EU. These partnerships will bring together all relevant players at the national and regional levels to improve research and development efforts, discuss funding for pilot projects and to mobilise demand. These partnerships will divide policy area goals into smaller, more achievable work packages. These will have a governance framework, which will make achieving our goals easier and quicker than the current system allows. The first goal the Commission proposed was a pilot project on active and healthy ageing this month. This project aims to add two years to the healthy life of everyone in Europe.
The final goal of the Innovation Union strategy is to remove barriers currently hindering ideas from going to market. This includes removing costly bottlenecks like expensive patenting, market divisions, skill shortages, and fragmentation of effort. These bottlenecks inhibit good ideas from going to the market and being implemented quickly. The Innovation Union plans to create a truly single market that will attract innovative companies. To achieve this several measures have been proposed like a European patent, greater standardisation, and stricter rules on government procurement.
Despite the Innovation Union’s promise that it will improve our quality of life and create jobs, there still appear to be some obstacles to its effectiveness. The EU has allocated €52 billion for the 2007-2013 period, a considerable amount of money, but there have been some worrying reports indicating that the burdensome nature of this research process may limit the Innovation Union’s appeal to companies. On 26 May, I submitted a parliamentary question to the Commission asking if it planned to make any changes in this regard for the next phase of the framework programme.
In reply, the Commission stated that the rules and procedures to tap into funding do need to be simplified in order to appeal to researchers, innovative enterprises, and small- and medium-sized enterprises (SMEs). Since the Europe 2020 Strategy was introduced, three more simplified measures have been included in the Innovation Union strategy. These include the acceptance of accounting practices for personnel costs, a flat-rate option for SME owners, and a unified internal interpretation of the rules. These improvements will allow for simplification and speed in operations.
It is crucial that we make a success of this innovation strategy, as it is the first of many steps required to make Europe a leader in our globalised world, to create more jobs for a healthy economy and population, and to help restore growth to Europe to allow us to escape the debt crisis.
