Commission explains why Europe needs research
Ahead of the European Council meeting on 16 and 17 June, where ministers will decide indirectly whether or not to accept the Commission's proposal of doubling EU funding for research and development(R&D) from 2007 to 2013, the Commission has published an impact assessment study that backs its proposal. According to the study, which examines the link between research investment and increased competitiveness, 'the new framework programme (FP7) will boost Europe's GDP, increase exports and reduce imports, all of which contribute to reversing Europe's problems of slow economic growth and declining competitiveness'. The study also highlights the beneficial effects that increased EU R&D spending will have on job creation and the added value of investing at European level. Europe has been suffering from low economic growth and declining competitiveness for some time now, states the study, yet modern economic literature proves that R&D is the principal engine of economic growth and productivity. A recent study, for example, showed that for each extra per cent invested in public R&D, there is an extra 0.17 per cent growth in productivity. An increase in EU R&D, coupled with increases in spending at national level, could therefore have considerable impact on productivity, believe the study's authors. Furthermore, public R&D has a 'crowding-in' effect which leads to additional business investment - a key point in mobilising private sector investment in research, which should contribute two-thirds of the R&D spending target of three per cent of GDP. 'FP7 can also provide the necessary framework conditions to attract foreign R&D investment. Currently, the EU is losing R&D investment to other countries,' states the report, pointing out that in 2001 there was a net outflow of R&D funding from the EU amounting to over six billion euro. The study then goes on to state that an increased budget for European R&D would strengthen the EU's human resources, creating as many as one million jobs by 2030. On the matter of the added value from investing in R&D at EU level, the study demonstrates that it encourages researchers to cooperate across national boundaries and to share complementary skills and knowledge, maximising scarce resources and reducing wasteful duplication of research spending therefore providing better value for tax payers' money. 'Many research activities are of such a scale and complexity that no single Member State can provide the necessary resources. EU funding enables partners to pool their funds, facilities and knowledge, culminating in a critical mass that would not be possible at national level.[...]Furthermore by improving the coordination of Member States' activities, while at the same time addressing issues that are not given sufficient attention in national programmes, FP7 will ensure more efficient spending on R&D across Europe, and foster sectors with significant potential,' adds the report. In addition, by providing a framework for disseminating research results across the EU, FP7 increases the chance of their being transformed into innovative products and processes. The creation of a European Research Council (ERC) to support basic research will also provide increased competition as an effective way of promoting higher quality and excellence, concludes the report. In a speech on 9 June, EU Commissioner for Science and Research, Janez Potocnik, warned against accepting the compromise proposal tabled by the Luxembourg Presidency that would reduce research spending by 40 per cent compared to the Commission proposal. Accepting the compromise proposal would lead to 'a Europe of the past, redistributing the wealth we have' instead of a 'Europe of the future, thriving on knowledge and creating more prosperity for more people', he stated. In the eventuality that the compromise proposal is accepted, Mr Potocnik explained that this would require radical decisions on research priorities for future funding in order to avoid dispersion and fragmentation of efforts. 'New actions and new initiatives would be most threatened, such as the creation of a European Research Council, the support to SMEs [small and medium-sized enterprises], the reinforcement of the Marie Curie programme for fellowships and the new policy for research infrastructures,' said Mr Potocnik. Calling on Member States to redirect public spending from redistribution to growth enhancing investments, Mr Potocnik warned that times are changing fast. 'Those who come too late are punished by life,' he concluded, quoting ex-USSR president Mikhaïl Gorbatchev.