SPEECH/07/744

Danuta Hübner

European Commissioner responsible for Regional Policy




"Delivering innovation
through Cohesion Policy"

Informal Ministerial Meeting on Territorial Cohesion and Regional Policy
Ponta Delgada, Azores, Portugal, 24 November 2007

Ministers, Ladies and gentlemen,

One year ago, in Brussels, I had the pleasure to present you with the Commission's first assessment on how innovation had been retained in the draft national strategic reference frameworks for the period 2007-2013. I was rather positive then because we could already see clear indications of the priority given to innovation in the national strategies. On this basis already at that time I anticipated significant increases in the financial amounts available for innovation related activities.

Since then we have continued to follow closely the evolution of the situation during the negotiations of the operational programmes. We have been assisted in this by the improved system of information that we have put in place with your assistance. My services have produced a Staff Working Paper that is a background document for this meeting on the key components of innovation policy – RTDI, entrepreneurship, innovative ICT and support to high level human resources.

I would also like to inform you that we are finalising a Communication on "Delivering the Lisbon Agenda through Cohesion Policy", which will be adopted in the mid December in the general package that the Commission is preparing for the European Council in March. This communication will provide a full overview of all the planned spending under cohesion policy with a particular focus on the expected contribution to the renewed Lisbon Strategy.

Today I am delighted to go beyond my statement of last year and announce that, thanks to your commitment and to that of the regional authorities, the Cohesion policy 2007-2013 will play a major role in delivering innovation in these seven years crucial for Europe's growth.

Behind my optimism is the assumption that, if we manage to implement our programmes with an efficiency comparable to what we have planned, investment in innovation in the 2007-2013 years will triple in comparison to the amounts in the previous programming period. Importantly innovation figures very high on the agenda of new Member States and the less prosperous regions, that is exactly where this investment can have largest impact on the Union's competitiveness.

These financial amounts will be provided by the European Regional Development Fund (ERDF) and by the European Social Fund (ESF) and we can therefore cover the two crucial issues that innovation needs to materialise: infrastructures and skilled human resources. In this way Cohesion Policy is now positioned to make an invaluable contribution to our major objective: competitive European regions.

Let me now present to you in more detail the main messages from the Staff Working Paper prepared by the Commission Services. This paper recalls the pioneer role of cohesion policy in promoting innovation, summarises the main results of the data we have analysed from the adopted and draft programmes, and finally concludes with recommendations regarding the way to proceed in order to ensure that from such a good start results will materialise.

Let me start with some words about the pioneer role of Cohesion policy in fostering innovation.

Over last years networking and partnership processes were fostered through the Innovative Actions programme, INTERREG and URBAN, co-financed by the ERDF and through EQUAL and ADAPT, co-financed by the ESF. Many networks of regions, cities, partners and business support services started through these means. They became active on the ground and were recognised by the quality of services delivered to businesses and public authorities. The most successful initiatives have even become independent from direct financial support from Community funds.

This experience has been mainstreamed into the modus operandi of the new cohesion policy for which reducing the innovation deficit across EU regions became a key task for 2007-2013. In the European Union, 86 regions (123 million people) have an innovative performance below the EU average, the great majority being located in new Member States, Spain, Greece, Portugal and southern Italy. As innovation is a key competitive advantage in global economy, the massive investment by cohesion policy should dramatically improve the competitiveness of European regions and the Union as a whole.

But our commitment to innovation cannot be measured by financial amounts only. Cohesion policy – like innovation – is also about co-operation. It supports a growing web of clusters, exchanges and networks linking our cities and regions and extending beyond the Union's borders. This means more experience, more knowledge, more new ideas which can be quickly shared and disseminated and, ultimately, more innovation which is a key factor in triggering a dynamic, forward looking development process.

The lesson one can draw from this experience is that today Europe's full potential cannot be reached by the Union, individual member states or by regions on their own. Economic success requires close co-operation among all of them. Thus cohesion policy should act as a lever improving multi-level governance and expanding the meaning of governance beyond traditional administrative structures.

Let me now turn to the assessment which is summarized in the working document you have in front of you. How has it been done?

From the list of expenditure categories included in our monitoring system, my services have identified 4 groups of categories with a specific innovation component. These four groups represent innovation in the broad sense, as described in the Community Strategic Guidelines.

• The first group of expenditure categories represent Research, Technological Development and Innovation: they focus on RTD infrastructure and centres of competence, on technology transfer and improvement of cooperation of networks, on assistance to SMEs to invest on RTD and on innovative ways of organising work or promote environmentally-friendly products and processes.
• The second group addresses entrepreneurship support: the creation of financial schemes to support self-employment and business start-up and advanced support services for firms and groups of firms.
• The third group encompasses all foreseen investments on the demand side of the information and communication technologies, including services to businesses and citizens, such as e-government, e-health and so on.
• Finally, the group 'human resources', includes support to the development of skills and mechanisms related to innovation capacity of staff in firms; training and services for employees to step up their adaptability to change, promotion of entrepreneurship and innovation and design and dissemination of innovative and more productive ways of organising work.

The result of this first analysis overall is very encouraging. The planned EU investment for innovation in 2007-2013 will be above EUR 85 billion which corresponds to 25% of the total new envelope for the 27 Member States. This value is more than 3 times higher than in 2000-2006. The financial volume for the EU 15 is more than EUR 48 billion corresponding to 30% of their total allocation under cohesion policy, while for EU 12 it is EUR 35 billion or 20% of the total EU resources available to them.

If we break these resources by objectives, we can see that 22% of the total allocation to Convergence objective - more than EUR 61 billion - will be invested in these four innovation categories, while in the Competitiveness and Employment objective the corresponding figure is 40% or almost EUR 22 billion. In the annexes to the document you will be able to benchmark relative shares of allocated to these groups of activities with the relevant benchmarks – for EU-27, EU-15, EU-12.

On the top of increased investment in innovation in the 2007-2013 programming period we are also seeing a trend towards a more strategic approach aiming to boost and integrate growth strategies at European, regional and local levels. This approach seeks to ensure that each sector of the economy is developed not in isolation but in the context of a coherent vision for the socio-economic development of the Member State or region concerned. In addition, we can see an emphasis on placing innovation in the centre of this vision, for example through encouraging regions to develop regional innovation strategies.

It is important to remember that investment in innovation and strategic approach to development can only work if supported by concerted efforts of all partners. In the first instance the effort of regional and national authorities to develop strategies to improve their innovation systems must be accompanied by engaging the other key players in the innovation system – the research community, universities and business.

We also work with the national and regional authorities on improving arrangements for co-ordinated preparation and use of the different Community instruments – such as cohesion policy and 7^th Framework programme - to support RTD, innovation and development at national and regional level. This was highlighted in the recent Communication on synergies between EU policies - "Competitive European Regions through research and innovation" – that I shared with Commissioner responsible for research.

My final conclusion is that as the programming stage for the 2007-2013 is coming to an end the time has come now to deliver. Delivering on ideas, human resources, innovative technologies and products is a complex task which requires a continued, concerted effort and on-going assessment of progress from the responsible authorities.

Both the renewed Lisbon Strategy for Growth and Jobs and Cohesion Policy 2007-2013 have emphasized innovation as a way of finding solutions for many of Europe's problems. Innovation has been recognised as a policy priority as never before. The Commission will continue to work closely with the Member States in an effort to ensure that support to innovation is a focus of the 2007-2013 Cohesion Policy Programmes, using initiatives such as Regions for Economic Change to promote exchanges of experiences and best practices in support of innovation.

I invite you to be with us at every step of this way.

Thank you for your attention