Bruxelles, 9 June 2005

Ladies and gentlemen,

It is with great pleasure that I welcome you here today.

It is encouraging to see leaders of European industry gathered together to make a success of the European Technology Platforms.

Since we last met in December, much has happened.

New Lisbon Strategy

In March, the Council fully endorsed the Commission’s proposals to re-launch the Lisbon strategy.

The aim is to re-invigorate Lisbon by focusing on growth and employment in a stronger partnership with Member States.

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Building the knowledge society and leveraging knowledge and innovation for growth is at the heart of this renewed Lisbon strategy.

I am convinced this does not come as a surprise to you.

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You, at the vanguard of industrial development, you know probably better than anyone else that Europe has to concentrate its efforts on its true strengths. At least if Europe wants to face the mounting competition from the global economy in a sustainable way.

The emerging markets in which your companies compete are increasingly global and knowledge-intensive. By raising the knowledge capacity of our firms, our competitive advantage can be based on providing the best new products, processes and services in the world.

This is why our true factor of competitiveness lies in our brains and our creativity. It is “knowledge” in the broadest sense of the word.

In Europe, we need to become much better at the way we produce knowledge through research, at the way we diffuse knowledge through education and at the way we use and apply knowledge through innovation.

For the first time, with the new Lisbon agenda, we have a coherent programme to build the knowledge economy.

At the Commission, we are working to develop appropriate framework conditions for knowledge and innovation. For example:

• we are preparing a revision of the state aid regime to make it more favourable to research and innovation;
• we will come forward with initiatives to promote fiscal incentives in favour of R&D;
• we will publish guidelines to encourage the cooperation between industry and academia; and
• we will take action to enhance the value of research as a profession in Europe.

We are also mainstreaming the knowledge for growth concept in all EU funding programmes, such as the structural funds and the competitiveness and innovation programme, to name only two.

The biggest EU programme is the Framework Programme for Research. In April, we presented our proposal for the Seventh, which will run from 2007 to 2013.

7th Framework Programme

Our proposal for the Seventh Framework Programme is designed to help realise our renewed Lisbon objectives linked to knowledge for growth and jobs.

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The proposal is built around 4 objectives, corresponding to 4 programmes:

• First, the Cooperation programme is of most significance for technology platforms. Its objective is for Europe to gain leadership in key scientific and technology sectors by working together across borders between industry, academia and public authorities. We see a very strong role for industry in this cooperation, notably through your leadership of technology platforms whose role is strongly reflected in the proposal.
• Secondly, the Ideas programme, with the objective of stimulating excellence and creativity in the higher-risk, frontier research that will provide the basis for tomorrow’s breakthrough innovations.
• Thirdly, the People programme, with the objective of supporting researcher mobility, training and career development.
• And, fourthly, the Capacities programme through which the EU can build the capacities it will need in the knowledge economy, for example in terms of research infrastructures and innovating SMEs.

The Seventh Framework Programme also proposes to introduce a novel risk-sharing finance facility aimed at improving access to loans from the European Investment Bank for large European research actions. This could apply to the implementation of certain parts of your Strategic Research Agendas.

Perspective on Financial Perspectives

I am strongly encouraged by the very positive reception that our proposals for the Seventh Framework Programme have had so far.

The European Parliament has strongly backed the Commission’s proposal to double the European R&D budget.

Doubling the R&D budget may seem ambitious.

I believe it is rather modest in light of the challenges we face to preserve our way of life, the broad commitment we have to the Lisbon strategy and the opportunities and needs that lie ahead to realise “Knowledge Europe”.

Add to this that EU research funding has a strong leverage and multiplier effect, both on national research budgets and on private R&D investments.

Obviously, the Framework Programme alone will not suffice in this regard. National budgets and policies must follow suit. Fortunately, as a result of the Lisbon agenda, R&D and innovation is now high on most national agendas.

But a moment of truth is quickly approaching for our efforts to build the knowledge economy, and for the Lisbon strategy in general.

You know I refer to the financial perspectives.

The decision to be taken by the European Council is obviously a difficult one and has many different dimensions.

But it will in any case demonstrate how serious the Member Status are about Lisbon.

By deciding where to invest, governments will show what kind of Europe they want: a Europe of the past, redistributing the wealth we have, or a Europe of the future, thriving on knowledge and creating more prosperity for more people.

Looking at the compromise proposal that is currently on the table, people will be forgiven for thinking and saying that governments want a Europe of the status quo.

The compromise proposes a 40% cut in the heading for Lisbon programmes compared to the Commission’s proposal. That compares with only an approximate 10% cut for structural funds and an approximate 5% cut for agriculture.

It is hard to send a clearer message on where Member States’ priorities lie.

In the Commission’s proposal, the Lisbon heading would account for 12,2 % of the total EU budget. In the compromise proposal, that would only be 8,5 %, while the share of agriculture would increase from 40 to 43 %.

With such a budget, can the Member States convincingly say that they redirect public spending from redistribution to growth enhancing investments?

As a result, I am afraid Europe risks becoming poorer and less competitive in a rapidly developing world.

• Such a budget would increase the already alarming gap in research investment between the EU (2% of GDP) and its competitors (USA: 2,7%; South Korea: 2,9%; China: 1,5%).
• It would jeopardise our commitment to reach the 3% target for R&D investment.
• It would erode the EU’s ability to address new science and technology challenges and opportunities in areas such as personalised medicine, nano-electronics, hydrogen,...
• It would encourage the knowledge-based companies and universities of the future to invest outside Europe.

In case the compromise proposal would lead to a 40% cut in the proposed research budget, this would require radical decisions on priorities in future funding in order to avoid dispersion and fragmentation of efforts.

40% of the proposed FP7 budget represents the sum of all activities beyond the traditional collaborative research. New actions and new initiatives would be most threatened, such as the creation of a European Research Council, the support to SMEs, the reinforcement of the Marie Curie programme for fellowships and the new policy for research infrastructures.

Two days ago, I told ministers in the Competitiveness Council that the current compromise proposal would mean that future EU research would also reflect the status quo. {President Barroso gave the same message to the Parliament.}

Don't get me wrong: our "usual business" was not bad at all. But times are changing, and they are changing fast. And, as Gorbatchev noted at the time: "Those who come too late are punished by life".

?f we want our researchers, our companies, our SMEs, our universities, our students and many others to believe that today’s Union is also their Union, a strong, future-oriented Union - if that is what we want, governments should be advised not to make the biggest budget cuts in the field of knowledge and innovation.

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I know that industry and the research community understand the urgency and importance of this message.

Investing in research is not an option for Europe, it is a necessity. Cutting R&D budgets may seem the least painful today. But it will hurt us most in the longer run.

I hope that the leaders of technology platforms will also make their voice heard.

Technology Platforms

Irrespective of what happens in the Financial Perspectives, technology platforms are set to become powerful actors in EU research policy.

As I said at our last meeting in December, technology platforms should be our champions of knowledge for growth.

Firstly, because they will contribute to focusing our research funding on areas of research which present a high degree of industrial relevance. It is not, in first place, a question of channelling more FP money to industry, but rather of ensuring that EU research responds to industry’s needs.

The Strategic Research Agendas are precisely the tools we need for that. They have already significantly inspired the identification of research themes for the Seventh Framework Programme.

Secondly, technology platforms can cover the whole economic value chain - from knowledge production to transforming that knowledge into successful technologies and processes, products and services.

I would expect technology platforms to address all innovation challenges in a coherent way, so that at the end of the day, the results from research are taken up in the market and Europe can increase its innovative capacity to transform excellence in science into increased economic value.

This is why I believe your leadership role, as industrialists, in technology platforms is essential. It ensures that platforms are focused on potential future markets for key technologies and that they give the necessary impulse to realise Europe’s potential in cutting edge technologies.

In this regard, openness and transparency are important in ensuring the participation of regulators and other stakeholders. This promotes widespread awareness of the opportunities and challenges that key sectors represent in the knowledge economy.

Thirdly, though certainly not least importantly, technology platforms can mobilise public authorities at national and regional levels to participate in this joint effort.

The European Framework Programme is only one source of research funding. As industrialists, you are only too well aware of the need to create better synergy between European and national investments, and between public and private efforts.

Joint Technology Initiatives

As I have already emphasised, the Framework Programme will support the implementation of Strategic Research Agendas through the work programmes under the various research themes. These themes will have greater flexibility to use a simpler set of instruments to respond to specific needs.

In some areas, there may be an opportunity and a need to establish a long term public private partnership of a scale and scope that cannot be supported through the normal procedures and instruments of the Framework Programme.

In such cases, the Commission will be ready to propose, for decision by the Member States, the establishment of Joint Technology Initiatives.

A number of conditions would of course have to be met. A Joint Technology Initiative must not only make a unique contribution to Europe’s industrial competitiveness in strategic technologies. It must also show clear evidence that the normal instruments of the Framework Programme would not achieve the desired outcome.

This last point is critical. To be successful, a technology platform does not necessarily need to lead to a Joint Technology Initiative. In the majority of cases, a technology platform can be implemented most effectively using the normal instruments of the Framework Programme.

The idea that technology platforms are only successful if they lead into a Joint Technology Initiative is therefore unquestionably a false one. I use the opportunity of today’s meeting to dispel this idea.

In presenting its proposal for the Seventh Framework Programme, the Commission has identified a limited number of areas where a Joint Technology Initiative could have particular relevance.

This list is not final and it is not finite. It is quite possible that, in the future, other Joint Technology Initiatives could be proposed.

It is now for the industries involved in the six areas identified to build a case to demonstrate that their Strategic Research Agendas meet the criteria for a Joint Technology Initiative. It is also for them to show that implementation of a Joint Technology Initiative will lead to concrete deliverables that will impact positively on Europe’s industrial competitiveness.

Joint Technology Initiatives would be directly co-funded by the Framework Programme and Member States must agree to their launch. The Commission will therefore only propose Joint Technology Initiatives in cases where we can convincingly demonstrate to Member States, and to the tax paying public at large, that this makes sense.

Conclusion

Ladies and Gentlemen,

Knowledge for growth must be and will be at the core of the Seventh Framework Programme. Making the programme more relevant for industry is a vital part of this, and technology platforms have an important role to play in making this happen.

So technology platforms are, and will continue to be, essential partners in our European research and innovation policy, irrespective of whether or not they lead to Joint Technology Initiatives.

I know that the expectations from technology platforms vis-à-vis the Framework Programme are very strong, and allow me to state that these expectations are legitimate.

But let me also say that my expectations vis-à-vis the technology platforms are equally strong.

We see technology platforms as a smart, European way of working together and we will try to facilitate their success wherever we can.

Thank you for your attention.

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