Working document justifies CIP structure

April 21, 2005

Brussels, 20 Apr 2005

Before drafting proposals for the new Competitiveness and Innovation Framework Programme (CIP), the Commission examined and rejected a number of other options, as outlined in a staff working paper annexed to the proposal.

As the Commission itself notes, several programmes have been running at EU level for some time addressing the same issues that the CIP will seek to tackle: the promotion of entrepreneurship; the stimulation of innovation in the field of information and communication technologies (ICT); and support for the fostering of energy efficiency.

'A possible option, therefore, would have been to continue to implement the various programmes independently. However, this option would have not created synergies between them, nor would it have been acceptable to continue to address some of the issues relating to the strategy for growth and jobs in a piecemeal fashion,' states the working document.

'A more ambitious option would have been to merge the specific programmes into one single cross-cutting integrated programme. However, the outcome of the stakeholder consultation clearly favoured a more balanced approach, which is reflected in the chosen option: a framework programme with specific pillars building on the existing Community programmes,' the paper explains.

The resulting programme is expected to have economic, societal and environmental impacts. The majority of these are positive. For example, financial instruments for small and medium sized enterprises will enable the creation and growth of enterprises where the market has failed to do so, thus creating employment. An increased uptake of ICT will boost productivity, and, according to the paper, will improve the balance between work and leisure.

A table included in the working paper lists what the likely outcome would be if all Community programmes for competitiveness and innovation were terminated, if no change was made to the current programmes, and if the CIP were implemented. Implementing CIP comes out clearly on top in this analysis.

However, the Commission also admits that the chosen approach will mean a number of trade-offs. For example: 'The shift to more knowledge-intensive and innovative activities could result in aggravating the employment problems of unskilled workers in the short term,' states the paper. Also, the financial instruments for SMEs envisaged in the proposals are market-based and therefore different to public grants and state aids that are usually tied to a political objective. Their use will thus be hampered if SMEs can obtain public grants or aid for the same investment purposes.

The Commission's argument for the existence of an EU level programme to tackle competitiveness and innovation issues is as follows: 'while progress has been made in some Member States, the overall picture is, at best, patchy. There is therefore a complementary role for Community action to support coherence, address certain market failures, and ensure consistency in implementation.

Whether or not the programme can be effective, and whether the recommended approach is the right one, will become discernable through the publication of various programme evaluation reports. Interim and final evaluations will examine issues of relevance, coherence, effectiveness, efficiency, sustainability and utility.

For further information, please consult the following web address:
http:/// y/cip.htm

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