Analysis and monitoring of R&I policies DG RTD, Unit A4 Science Europe WG on Research Policy and Programme Evaluation 12 November 2015 DG RTD, UNIT A4 Román Arjona

3 core things 1)Economic analysis SRI Competitiveness Report R&D Investment Scoreboard IU Scoreboard (with GROW) Fast-growing innovative firms Tax credits (with OECD) Economic modelling (with ECFIN) 2)European Semester Analysis of national reform programmes Country profiles Interfacing with economic analysis and policy support 3)Policy support Facility Peer Reviews and Specific Support Mutual Learning exercises 2

Regional distribution of R&D investments from world top R&D investors Top 2500 companies invested €538.5bn = 90% total world business R&D investment Global change : R&D investment +4.9% Sales +2.7% 2014 EU Industrial R&D Investment Scoreboard EU+2.6%-1.9% US+5%+2% Japan+5.5%+11.2% Data 2013 R&D investment Sales Economic analysis: Investment Scoreboard

4 Source: DG Research and Innovation - Unit for the Analysis and Monitoring of National Research Policies Data: Eurostat, DG ECFIN, OECD Notes: (1) GDP per hour worked in PPS€ at 2005 prices and exchange rates. (2) IS, NO, CH, TR, IL, JP, KR: (3) IS, NO, CH, TR, IL, JP, KR: (4) EU: Croatia is not included. Economic analysis: Competitiveness Report

Policy Research and Innovation Research and Innovation The European Semester Yearly cycle of economic policy coordination 1)Annual Growth Survey (November): Sets out EU priorities to boost job creation and growth 2)Country Reports (February): Single analytical economic assessment per MS looking at economic situation and reform agenda 3)Country-Specific Recommendations (May): Tailor-made policy advice to each Member State in priority areas for next months 5

Annual Growth Survey (AGS) Coordinated boost to investment –Juncker Plan: EUR 315 billion –Investment-friendly environment (e.g. CMU) 2.Renewed commitment to structural reforms –Grow out of debt and stimulate job creation –Improve framework conditions 3.Pursuing fiscal responsibility –Differentiated fiscal policy –More fiscal space, more demand encouragement 6

AGS 2015: priority number 6 criticalInvesting in R&I is critical to kick-start growth 1.Continue to prioritise public R&I investment and ensure its quality/ efficiency 2. Ensure its leverage with regard to business investment 3. Ensure an investment-friendly business environment in support of private R&I investments and fast-growing innovative SMEs 7

8 Key drivers in the reports Challenge "Efficiency of public R&I spending" Use of performance criteria in institutional funding Use of international panels to evaluate projects Critical mass vs. fragmentation of public research Thematic/ challenge-driven prioritisation

9 Key drivers in the reports Challenge "Leveraging business R&I through public-private cooperation" Targeted funding schemes: proof-of-concept, public-private projects, industrial PhDs, vouchers Smart specialisation, common research agendas Incentives for public research: criteria for funding, performance contracts and career recognition

Key drivers in the reports Challenge "Investment-friendly business environment" 10 Policy mix (e.g. internationalisation of SMEs) Tax incentives SMEs Human resources availability, skills shortages (mismatches between curricula and labour market) Access to finance

Example: S&E graduates vs. BERD 11

12 Snaphot: assessment of policy responses in Estonia Innovation voucher scheme enabling SMEs to collaborate with universities and competence centre New Applied Research Programme in support of public-private projects in smart specialisation areas  Swift implementations could lead to promising developments

13 Snaphot: assessment of policy responses in Slovakia While the new support system to promote KT is a positive step, the delay in the adoption of the Implementation Plan for S3 is a major drawback Key bottlenecks to be addressed: o Low quality and lack of industrial relevance of the science base o Set-up of university financing system does not incentivise contract research and spin-offs Innovation voucher scheme, but limited use by SMEs, lack of evaluation

Policy Research and Innovation Research and Innovation Some CSRs on R&I in GermanyFurther increase public investment in infrastructure, education and research, including by using the available fiscal space NetherlandsShift public expenditure towards supporting investment in R&D and work on framework conditions for improving private R&D expenditure EstoniaFocus public support for research and innovation on a limited number of smart specialisation areas LatviaBetter target research financing and incentivise private investment in innovation on the basis on of the S3 Framework

Policy Research and Innovation Research and Innovation The Horizon 2020 Policy Support Facility New initiative to help MS "improve the design, implementation and evaluation of R & I policies" Supporting evidence-based R&I policies Operates on a voluntary basis and draws on high-level expert advice and assistance Replying to strong need to offer customer- oriented services to shape "policy responses"

Policy Research and Innovation Research and Innovation Services of the H2020 PSF (1) Peer reviews of national R&I systems: Assessments of national R&I systems by experts and peers Recommendations on R&I policy reforms needed (2) Specific support to countries: Pre peer reviews (preparation) & post peer reviews (follow-up) Support in specific areas of R&I policy (3) Mutual learning exercises Focus on issues of interest to several countries More in-depth, hands-on, based on learning-by-doing (4) PSF library: All Commission R&I products (data & studies) Compatible with the OECD Innovation Policy Platform 16

Policy Research and Innovation Research and Innovation (1) Peer reviews of national R&I systems Phase 3: REPORTING Discussion of draft peer review report with national authorities of the host country Final report and recommendations Presentation to all relevant stakeholders Phase 2: In-depth ANALYSIS and PEER REVIEW sessions Background analysis Self-assessment by host country First peer review session- assessment Second peer review session- feedback Phase 1: DESIGN and PREPARATION Commitment, Design and Scope of the process, Selection of experts & peers Collection of background data and reports Engagement of all relevant stakeholders

Policy Research and Innovation Research and Innovation e.g. BG peer review 'headlines' "3. Set up a professional, independent and robust national research agency to design and manage research and innovation funding programmes and support the successful implementation of the RI structural reforms package" "8. Incentivise the opening up of Bulgaria's science base to businesses and step up the schemes to support public-private cooperation" "9. Create the conditions for specific regional and local innovation ecosystems to develop in Bulgaria using the Sofia Tech Park as a strategic innovation test-bed"

Policy Research and Innovation Research and Innovation (2) Specific support to policy responses Pre peer reviews (scanning phase)  Preparation of full peer review  Build evidence-base and identify focus areas Post peer reviews (follow-up phase)  evaluation of implementation of recommendations  advice on how to strengthen implementation Specific support to countries (specific bottlenecks)  focus on specific R&I policy issues  recommendations on how to operationally tackle/ implement

Policy Research and Innovation Research and Innovation e.g. Hungarian pre-Peer Review: focus areas 1.R&I governance, funding and policy making 2.Availability of human resources for R&I 3.University-Industry cooperation 4.Technology transfer and entrepreneurship 5.Framework conditions for innovation in business sector

Policy Research and Innovation Research and Innovation (3) Mutual learning exercices Demand-oriented Hands-on, project-based "Learning by doing" New methodology Pipeline includes: Innovation procurement Tax credits Public-private partnerships Performance based funding of PROs Interoperability of research programmes

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