Bad news for research and innovation?

This article is part of the Science|Business special report "The new European Commission: Bad news for research and innovation?". The full report can be downloaded via this link. 

With great fanfare at a Brussels press conference on Wednesday (10 September), President Jean-Claude Juncker presented his slate of fellow-Commissioners – and, more importantly, their job definitions. That night, one EU official reflected privately to friends: “This could go very badly for research.”

For the past five years, the European Union has been steadily upgrading the budgets and importance of anything labelled research and innovation, in an effort to show it is investing in growth, jobs and Europe’s future. There was an Innovation Union policy, an Innovation Council of Commissioners, a 30 per cent jump in funding for research and innovation – making it the third biggest budget line in Brussels, after farming and regional development. Now, a bare 48 hours after the new Commission is announced, many are asking if this particular policy idea is no longer “trending” in Brussels.

With so few of the details yet communicated – or even decided – it’s premature to draw sweeping conclusions; and Juncker confidantes, closeted in meetings, weren’t immediately commenting. But that doesn’t stop anybody in Brussels, where jobs and power depend on such things, from poring over the official documents and frantically ringing around town for some instant guidance.

As one senior official jokingly put it: “Now is the time to fear for the worst, and spin for the best.”

Reading the tea leaves

The “bad news” signals include:

• The new Commission doesn’t include innovation among its stated priorities, as reflected in the new organigram. Individual areas of research and innovation – notably energy and digital technologies – get an upgrade in importance with their own Vice Presidents; and pharmaceutical and chemical companies were rejoicing that their new bosses will now be in more industry-friendly hands than before. But the idea of research and innovation as a cross-cutting issue of top-level importance in its own right isn’t reflected in the new structure. Whether that’s on purpose, or just an oversight in the administrative rush, is a question much-discussed in the past 48 hours; but either way, the answer wouldn’t be encouraging to R&D advocates.
• The new research commissioner, Carlos Moedas of Portugal, has had part of his empire carved up. Some of the EU’s Executive Agencies – which handle the basic tasks of pushing grant money out the door – are having their portfolios distributed among several commissioners rather than reporting to just the Research Commissioner as in the past. Thus, for instance, transport research grants will be under the direct control of the new Transport Commissioner. At the same time, several insiders observed, Moedas appears to have been given a relatively junior status. His letter of mandate has him working with four different Vice Presidents, rather than having a single champion as with the more-weighty energy and digital portfolios. Of course, none of this means Moedas can’t have impact; but if so, it will be due to his political skills and force of character, rather than official status.
• Science is looking wobbly. Moedas’ formal title is Commissioner of Research, Science and Innovation – just like his predecessor, Máire Geoghegan-Quinn of Ireland. But his letter of mandate doesn’t list science or basic research as a priority, and many in the Commission are speculating that could be bad news for universities and other recipients of fundamental research grants. The European Research Council, the main basic-science agency of the Commission, is highly regarded by both the Parliament and the Council, so its budget is presumed safe; but other so-called “Excellence in Science” programmes may be less secure.
• One of the biggest surprises was the transfer of the Joint Research Centre, a 3,000-employee collection of government laboratories and policy analysts, from the control of the Research Commissioner to that of the Education Commissioner. In fact, it took some of the new commissioners themselves by surprise, suggesting it was a last-minute adjustment in the Juncker plan.  Exactly what it will mean, in substance, is a mystery in Brussels right now – but a Juncker spokeswoman said the move is intended to enhance its transversal role of providing science and technology advice to all other directorates-general. Exactly how, isn’t clear. 

On the other hand…

There are, however, plenty of “good news” signals, as well – if your interest is in a particular sector, rather than in the overall concept of research and innovation.

• Energy R&D is a winner in the new line-up. The decision to appoint two commissioners responsible for energy portfolios – both tasked with speeding the creation of an integrated European energy market – reflects growing concerns for EU energy security. Linking 28 national energy systems into one integrated network will be one big job. Developing low-carbon technologies to underpin it, another. A revised Strategic Energy Technology (SET) Plan set to roll out in 2015 already makes network integration technologies such as smart grids a top priority, so no major changes to the new plan are expected. What’s new?  Both energy commissioners have portfolios that pool energy and climate dossiers – an effort to break down silos and enhance coordination among directorates.
• Health policy now comes with all the care of a physician. In his letter of mandate to Andriukaitis, Juncker is frank: the tasks of the health Commissioner will be “limited”. For those who prefer their Commissioners to focus on a few key tasks, this is welcoming. The pharmaceutical and biotech industries are happy anyway: with medicines, medical devices and health technology moving to the newly enlarged Enterprise directorate, a greater emphasis is on increasing their economic performance. What’s new? Regulation of pesticides – “biocides” officially – is now under the roof of the health directorate.
• In the digital domain, Brussels has called in two men to replace the indomitable Neelie Kroes. ICT loomed large in the mind of Juncker during his election campaign. Creating a connected digital single market Europe can generate up to €250 billion of additional growth over the next five years, he believes. While the drafting-in of an extra Energy Commissioner was a product of concern for energy security, the move to binary in digital is surely a product of growing opportunities. What to look out for: Ansip’s six month deadline for a data protection deal, renewed attention on copyright, online piracy and net neutrality and Oettinger’s grapples with Google Inc

Breaking the silos

Overall, the reaction inside the Commission to Juncker’s changes were mostly positive. Several senior officials praised the concept of the two-tier Commission, with its Vice Presidents sitting on top of large portfolios handled by narrower, lower-tier Commissioners. It was viewed as a surprisingly bold step towards a once-radical idea: To break down the institutional silos inside the Commission by putting individual Vice Presidents in charge of large policy clusters, rather than scattering the work of the Commission among 28 different equal Commissioners, one for each member-state. Some officials speculated that, if it goes well, the next President might be able to do the unthinkable: Reduce the number of Commissioners to a manageable dozen or so.

But, as one senior Commission official put it, “the test is yet to come.” By that, he means that it’s not clear yet whether, as planned, the new Vice Presidents will actually have the authority to filter proposals out before they come to decision. Under the Juncker system, no proposal is supposed to reach decision unless the Vice President for that policy cluster agrees; the aim is to keep the Commission focused only on major issues – something many industry executives, weary of proliferating minor regulations, have advocated. But officials with long institutional memories speculated that some of the new Commissioners might manoeuvre around the Vice Presidential barrier – perhaps by appealing for help from their national governments, or engaging in some creative horse-trading with their colleagues.

Another potential problem is ambiguities in the boundaries of the various Commission portfolios. In an area of overlap, some officials said, the two directorates-general involved could waste time in turf warfare. That happens today, of course; but with, for instance, two energy commissioners and two digital commissioners, the opportunities for conflict are multiplied.

Don’t hold your breath

Of course, the effect of all this change is going to be delayed, and slow. For starters, the new Commission has first to be approved by the European Parliament, in hearings scheduled for Sept. 29 through Oct. 3 in Strasbourg. Already, two of the Commissioners – from Spain and Hungary – are expected to hit rough political waters there. If all goes as planned, the survivors of the hearings will take office Nov. 1. And, within three months of taking office, they are supposed to deliver a new economic growth plan.

That sounds bracing. But in fact, the overall contours of the EU budget have already been fixed in law through 2020. And while there is plenty of room for manoeuvre within each of the individual budget lines, the EU bureaucracy has so much inertia that it may be a year before any systematic change starts to be seen. Within the research and innovation field, the most obvious first opportunity for change will be during the course of 2015, when the Commission is writing its new “work programme” for Horizon 2020, the main research and innovation budget; it is currently operating on a programme that runs through 2015, so any new plan wouldn’t take effect until 2016.

Another opportunity for change will be the scheduled mid-term review of Horizon 2020, set for 2017.

As for the importance of innovation, some industry officials have long noted that the whole trend seemed a bit superficial. For instance, Raymond Hegarty, Vice President of Global Licensing for Intellectual Ventures, an IP strategy firm, observes that “most people use the word “innovation” without understanding what it means. It is a cool buzzword and most examples point to Steve Jobs without really knowing what he did or how the lessons could transfer to other firms. For me, I see most people confusing ‘research’ with ‘invention’ and ‘innovation’. ‘’

Whether the new team are thinking that way isn’t yet known. One official noted that they appeared to have little real knowledge or interest in the topic of innovation. Instead, what mattered to them were their stated priorities such as better regulation, budgetary discipline and economic growth. But a more sympathetic official said they appear to view innovation as “an enabler” that cuts across all portfolios and all sectors, rather than something to develop for its own sake. So, by this view, the changes aren’t a descent in importance at all; instead, they are a kind of bureaucratic apotheosis.