Brussels, 18 May 2006

European Commission conference on the open method of coordination in research
Brussels, 18 May 2006

Ladies and Gentlemen,

I would like to start by thanking the Austrian Presidency for co-organising this conference with the Commission.

I believe that now is an ideal time to organise a conference on improving Research Policies through the Open Method of Coordination.

First, we have just completed the “second cycle” of the so-called Open Method of Coordination applied to the 3% objective and it is therefore an appropriate time for stock taking and reflection on ways to strengthen it in the future.

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Second, research and innovation are at the heart of the renewed Lisbon Strategy because of the contribution they can make to growth and the creation of jobs.

For example, a recent report by the Dutch National Bureau for Economic Policy Analysis has shown that increasing investment of the EU to 3% of GDP in R&D by 2010 could result in an average increase in the level of GDP of 3-10% for the EU in 2025.

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1. The need for coordination

As you may be aware, at the moment about 94% of all public investments in R&D are made by Member States. Even though there will be a substantial increase in the budget of the Community Framework Programme, Member States need to continue to increase their investment in R&D in the future.

The Framework Programmes have played and will continue to play an important role in fostering trans-national cooperation and in structuring the European Research Area. However, in my view the balance between EU and national investments in R&D makes it essential to improve the effectiveness and consistency of Member States’ research policies.

There is ample evidence, for example from the Framework Programmes, that in many cases co-ordinated actions are more effective policy responses than uncoordinated actions.

This is confimed by economic studies, such as the Dutch study I mentioned before, according to which coordination of national policies between Member States will create international spillovers and thereby increase social returns.

At the EU level the Framework Programme is the main Community instrument in the area of research. The Framework Programme has a high leverage effect through its effect on national programmes. But it is mainly a funding instrument and research policies involve also regulatory and other instruments. The EU level intervention is not often possible or appropriate because there is no one-size-fits-all approach in many areas of research policy.

In terms of policy coordination the main tool at our disposal is the Open Method of Coordination, which we should apply as effectively as possible.

This coordination is a voluntary process which, in order to be successful, requires commitment of the Commission and Member States both at the political level and within the higher ranks of the administrations.

2. The first two “cycles” of the OMC 3%

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Before looking at future prospects for the OMC 3%, it is useful first to briefly review progress so far as we see it from the Commission’s perspective.

The application of the Open Method of Coordination to research is much more recent than in the field of employment and economic policy. It started at the end of 2003 following the adoption by the Council of the 3% objective in 2002 and the 3% action plan prepared by the Commission.

The process is overseen by Committee for Scientific and Technical Research (CREST) with the support of the Commission. The first CREST report was adopted in October 2004 and the second one is now being finalised. It will be discussed at tomorrow’s CREST meeting

The aim of the OMC 3% is to help Member States improve the effectiveness of their policies through:

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• First, enhance mutual learning, peer reviews and the identification of good practices,
• Second, helping Member States develop more coherent and concerted policies as well as joint initiatives on issues of common interest, and
• Third, the identification of areas where Community initiatives could reinforce actions at Member State level.

Over the two cycles of the OMC 3%, there has been significant progress and increasing commitment from Member States. All of them as well as some candidate and associated countries have participated .

We believe that mutual learning by Member States has been intense, that good practices have been identified in a number of areas and that guidance has been provided so that Member States can improve their policies. We believe all Member States have benefited from the OMC 3%.

For instance, some countries considering reform of public research organisations have benefited from the experience of countries that have recently undertaken such reforms.

Some countries are introducing new fiscal measures or modifying the old ones to increase their effectiveness. This is very important because EU Governments allocate billions of euros to these kinds of measures.

The work on improving the design of policy mixes has also been well received. Three countries have had peer reviews of their research policy mix. This proved to be very useful. At this moment six countries have notified an interest to be peer reviewed in the next cycle.

This mutual learning points to the need for establishing at European level guidelines to be used by Member States on a voluntary basis to improve policies in two areas: trans-national industry-university collaboration and fiscal measures for research. The Commission is preparing two communications with concrete recommendations in this respect.

Furthermore, the Commission has launched a pilot call for proposals (OMC-NET), in order to support bottom-up initiatives by groups of Member States to develop and coordinate their policies in areas of common interest.

This scheme allows regional authorities and other stakeholders to be involved in policy co-ordination initiatives. The number and quality of the proposals confirms the need and interest for this initiative which will be continued in FP7.

3. The renewed Lisbon Strategy and the National Reform Programmes

The renewed Lisbon Strategy adopted in 2005 has introduced a streamlined progress reporting. As a consequence Member States have presented “National Reform Programmes” (NRPs). Member States will present progress reports in the autumn each of the next year.

In the NRPs, basically all Member States identified research and innovation as one of their main priorities for reform in the years to come. They have all set ambitious R&D investment targets. If these individual targets are achieved the EU R&D intensity would reach about 2.6% in 2010, which would be good progress towards the 3% target in 2010 without however achieving this goal.

While National Reform Programmes provide information on broad policy developments, OMC 3% focuses on specific policies. NRPs also provide Member States priorities and new initiatives and, thereby, show the interaction between R&D policies and other policies

CREST has been asked by the Competitiveness Council to use the National Reform Programmes and the progress reports due in October 2006 as a basis for mutual learning. I am confident that CREST will find an effective way to do this and will provide useful recommendations to the Council.

I think these developments are very encouraging. They show that there is willingness and political commitment to reform and reinforce national research policies.

4. Developing the OMC 3% in the future

In developing the OMC 3% further, I do not think there is a need to change its objectives or its basic working principles. The challenge is rather to build on and enhance the good work of the first two cycles.

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I see four areas for improvement:

• OMC has to focus in the areas where the trans-national dimension is greater and where the impact can be bigger.
• A specific area in need of mutual learning and coordination may be the use of structural funds for regional development to support research and innovation.
• Mutual learning has to take place amongst policy makers at the level of CREST as well as at the level of experts. This should for example be the case in the mutual learning on the NRPs.
• The OMC process needs to be more effective in producing clear guidance, identifying good practices and producing strong recommendations. Europe needs to move quickly towards a knowledge based economy and improve its productivity if it is to be successful face to the competition not only from the US and Japan but also China, India and other countries
• OMC has to be embedded in the research policy making in the member states and has to ensure effective take-up of results. Good practice and guidance available at hand should be readily used.

To conclude, I think we have a challenging and very important task in front of us. I would like to encourage you to explore how to improve EU research policies and their coordination for the benefit of all. I am sure that MS and also the Commission will listen to the recommendations that will emerge from your discussions.

Thank you for your attention.

Item source: Date: 18/05/2006