1. European Commission Preparation of the Innovation Union Flagship Initiative European Commission Presentation to ERAC 11 June 2010

2. European Commission Why Innovation Union? Crisis Societal challenges New global competition Framework conditions Fragmentation of efforts A distinctive European approach to innovation  Societal challenges, role of public sector  Europe’s strengths in creativity and design  Involving everyone: SMEs, citizens, cohesion Europe 2020: answer is innovation We must do much better!

3. European Commission State of preparations Intensive work steered by Innovation Group of Commissioners Building on consultations and dialogue with Member States and stakeholders, including:  2009 Innovation public consultation  Innovation Business Panel  2009 ERA Conference  Ongoing ERA Partnerships / groups  Dialogue in context of Europe 2020  Dialogue with EP, Council, ERAC, EPG...

4. European Commission Timeline 15/7: Informal Competitiveness Council ~15/9: Adoption of Flagship Initiative 28/10: Informal European Council 26/11: Competitiveness Council (conclusions)

5. European Commission Scope of Innovation Union European Innovation Partnerships Principles for Member State policies International cooperation Governance From Idea to Market Knowledge foundation Breakthrough ideas Access to finance Innovation market

6. European Commission From Idea to Market Knowledge foundation Breakthrough ideas Access to finance Innovation market

7. European Commission Knowledge foundation Issues  Insufficient supply & quality of research & innovation skills  Limited reforms in universities  Barriers to cross border flow of people, funding  Limited investment in strategic infrastructures Areas of action  ERA framework to remove obstacles to cross border flow of people and funding  Modernisation of universities, research training and careers  Launch of priority research infrastructures

8. European Commission Breakthrough ideas Issues  Underinvestment in knowledge triangle  Complex funding landscape  Costly EU patent system and unused patents  Little recognition of EU design strengths Areas of action  Streamlining and simplification of EU programmes  EU patent  EU knowledge markets (DK and FR examples)  Recognition of excellence in design

9. European Commission Access to finance Issues  Lack of finance is main constraint on innovative companies  Few European SMEs grow into major companies  Specific market gaps for start ups, high growth companies, major research and innovation projects  Current EU instruments (RSFF, CIP Financial Instruments) under funded. Areas of action  Cohesion Funds for R&I and smart specialisation  EU financial instruments to address market gaps, notably through EIB/EIF  State Aid framework

10. European Commission A Single Innovation Market Issues  Lack of harmonised regulations for innovations (e.g. type approvals of green vehicles)  EU standard setting too slow  Public procurers lack incentives, knowledge or scale to benefit from innovation Areas of action  Regulatory frameworks linked to Partnerships  Review of EU standardisation system  Procurement for innovation

11. European Commission European innovation partnerships

12. European Commission European Innovation Partnerships Issues  Major societal challenges  Many actions, uncoordinated - R&D programmes / demand-side actions - EU / national / regional (and global) To address these issues, European Innovation Partnerships will be:  Not a new instrument alongside the others; but  Frameworks bringing together main actors, policies and actions at EU and national levels, from research to market, around common objectives and targets

13. European Commission Principles for National policies International cooperation Governance

14. European Commission Principles for national policies Issues  National policies essential for establishing a single market for research and innovation  National research and innovation systems more effective if they share some broad characteristics, recognised as common to well-performing systems  « Integrated guidelines » under Europe 2020 are too general for this purpose. To address these issues, common benchmarks for national research and innovation systems could be developed and agreed with the Member States

15. European Commission International cooperation Issues  Need to attract best talents from abroad.  Need for stronger cooperation, notably on global challenges, but with level playing field on reciprocal access, intellectual property, interoperable standards, lifting trade barriers.  EU and MS weakened by their lack of coordination. Areas of action  Make the most of visa directive and Blue Card  Establish level playing field  Common EU-national policy orientations for international cooperationMajor global research infrastructure s

16. European Commission Implementation and governance Commitment at all levels  European Council Overall steering  EU Council Policy orientations, codecision  Eur. Parliament Policy orientations, codecision  Member States Apply benchmarks, specialise smartly  Regional and local authorities Specialise and develop potential  All actors From business to citizens

17. European Commission Implementation and governance Commission support  Initiative of proposals  Annual Progress Report (Europe 2020)  with Country Specific Recommendations  Independent peer reviews  of national systems  Technical assistance  for smart specialisation and use of structural funds  Innovation Convention on state of Innovation Union (yearly)  Scoreboard on research and innovation