31/05/2011

The future of R&D and Innovation in Europe
Pooling resources for better growth and competitiveness

By Alfredo Sousa De Jesus, Adviser on the Industry, Research and Energy Committee

The Seventh Framework Programme (FP7) is the largest transnational R&D programme in the world with €52 billion set aside for 2007-2013. It's a critical element in the realisation of a European Research Area and the fulfilment of the EU 2020 strategy objectives for growth.

Nowadays, as we are finding our way out of the economic and financial crisis, science, education and innovation provide a fundamental contribution in terms of economic growth, job creation and green, sustainable energy.


Bottlenecks in EU R&D and Innovation

The FP7 requires the highest standards of excellence, effectiveness and efficiency in research to attract and keep the best scientists in Europe and foster a more innovative and knowledge-based EU economy, able to compete in a global environment.

However, due to their success, EU research and innovation programmes have grown in recent years, in terms both of application numbers and budget size, creating management problems. More money brings more control and rules that are particularly difficult to cope with for SMEs, high-tech start-ups and smaller institutes. The current management of FP7 is, despite the improvements made in relation to FP6, still characterised by excessive bureaucracy, low risk tolerance, poor efficiency and undue delays that act as a clear disincentive to the participation of the research community, academia, civil society organizations, businesses and industry (especially smaller research actors, including SMEs).

Researchers are therefore calling for procedures to be harmonised and simplified. The EU research funding system should place more trust in applicants and be more risk-tolerant, albeit with clearly defined financial rules.

In this context, the European Parliament (EP) adopted a resolution on simplifying the rules of the FP under the responsibility of Maria da Graça Carvalho (EPP/PT).

The resolution reflects concern that the current system is excessively control-oriented, which tends to waste resources and reduce participation. Its "zero risk tolerance" management methods avoid risk, rather than managing them. The Resolution lists some serious and creative measures to remove bottlenecks faced by researchers, but adds that the system should be made more user-friendly, by making its legal framework more consistent and reducing the number of provisions. Above all, the system should be clear, unambiguous and manageable.

Steps to make procedures more efficient and user-friendly should include, inter alia:

• financial control methods which clearly distinguish between fraud and error



• uniform interpretation and application of participation rules



• broader acceptance of usual accounting practices for checking participants' eligible costs



• clearer terminology on the use of flat-rate and lump sums



• total abolition of time-recording mechanisms, such as time-sheets



• use of the "single audit approach" and "real-time" auditing to enable beneficiaries to correct any systemic errors and submit improved cost statements the following year



• reductions in average time-to-grant and time-to-pay.

Simplification measures need now to be implemented by the European Commission. Some of them can be swiftly and easily done now. Others require modification of the current rules and procedures under the FP7. Finally, others can be applied only from the next Framework Programme - FP8 - starting from 2013 onwards.

Midterm evaluation of the FP7

In parallel to the simplification exercise, in June the European Parliament adopted a Resolution reacting to the midterm evaluation of the FP7 (2007-2013), under the responsibility of Jean-Pierre Audy (EPP/FR).

Four important new factors affecting research and science have arisen since the FP7 adoption in 2007: the entry into force of the Lisbon Treaty, a new European Parliament, a new European Commission with a new EU 2020 strategy that makes research and innovation central to smart, sustainable and inclusive growth, as well as a major financial and economic crisis.

The EP seizes therefore the midterm review as an opportunity to adapt the current FP7 to those new realities till the end of the programme in 2013. The aim is to enable the EU to respond to the great societal challenges that concern all Member States and to which they cannot respond alone (ageing population and health, energy, water and food supplies, sustainable development, climate change, and so on), as well as to develop the knowledge to enable our businesses to innovate more and enhance their competitiveness.

The EP is of the opinion that results achieved by FP7 tend to demonstrate a European added-value with regard to R&D in Europe; despite the difficulties of the European Commission in communicating the successful results to Member States, the scientific community and European citizens.

The current simplification process and Midterm Review of FP7 come at a crucial moment by providing impetus for the preparations of the forthcoming FP8, through a Green Paper (see below) on the political priorities for the future of R&D in Europe.

The future of the R&D and Innovation in Europe

To launch the debate on the FP8, expected by end of 2011, the European Commission adopted a Green Paper on a common strategic framework for EU R&D and Innovation funding that Christian Ehler (EPP/DE) is following for the EPP Group.

Of particular importance for the future of R&D and Innovation in Europe, FP8 negotiations will take place at a crucial time, when the EU needs to compete with economic powers such as China, India, Brazil, Australia, the United States of America, and Russia. R&D expenditure in Europe is indeed low compared with other global powers, among other reasons, due to a lack of private investment and innovation-friendly framework conditions.

Our capacity to unite and coordinate our efforts in research, between the EU and its Member States, will therefore largely determine our future economic competitiveness and the wellbeing of Europe's citizens.