Potocnik calls for a 'Knowledge for Growth Pact' to complement Stability Pact

Brussels, 25 Nov 2004

In his first public speech as the new Commissioner for Science and Research, Janez Potocnik called for a renewed commitment to research, innovation and education in order to close the current delivery gap in meeting the Lisbon goals.

In this context, the Commissioner outlined a vision for a 'Knowledge for Growth Pact', as a similar yet complementary mechanism to the Growth and Stability Pact.

'If the aim of the latter is to ensure economic stability and fiscal discipline, the former should ensure relevant conditions and incentives for [a] sufficient level of funding for R&D [research and development] investment, and thereby revived economic growth,' Mr Potocnik told the Portoroz Business Conference in Slovenia on 24 November.

The Knowledge and Growth Pact would, he said, be organised around 'a limited number of quantitative objectives', which the EU and its Member States would commit themselves to achieving within a specified timeframe. Initiatives launched to achieve these objectives should cut across policy areas including research, education, industrial policy, internal market and justice and home affairs. These actions would be implemented using EU legislation and a revamped Open Method of Coordination, and funding would come from the Seventh Framework Programme for research (FP7) and the proposed new Framework Programme for Innovation, as described in the Commission's recent financial perspectives.

Switching his attention back to existing EU targets, Mr Potocnik detailed what he feels should be done in order to meet the Barcelona goal of investing three per cent of GDP in research by 2010. 'Clearly most of the research investment increase implied by Barcelona has to come from industry. [...] However, we should not underestimate the vital role of increased public R&D investment. Countries with high levels of public investment in R&D tend to have high levels of private investment,' he said.

The Commissioner stressed that progress towards the Barcelona goals depends mainly on the actions of Member States, but that the presence of quantitative targets in most countries is not sufficient. 'Member State targets are often not acted upon, policy measures are incremental, are not implemented as planned, and the overall effort and ambition are incompatible with the Barcelona three per cent goal,' he warned.

'Action must be taken immediately if we are to make up for lost time. The Commission's proposal to double the budget for the next Framework Programme sends a strong signal to Member States about the size of the step-change that is now necessary.'

The Commission is already planning to introduce a number of initiatives to further mobilise public and private research investment, including fiscal incentives, a guarantee scheme within FP7 to facilitate European Investment Bank funding for large European research projects, and development of the role of foundations and similar bodies in funding EU R&D.

'The current delivery gap with the Lisbon strategy demands that we take new, decisive action if we are to get back on track. The decisions related to the structure of the Union budget in the next Financial Perspectives will be a clear signal [of whether] we are aware of the seriousness of the situation,' Mr Potocnik concluded. To read the full text of Commissioner Potocnik's speech, please: click here

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