Viewpoint: Europe needs to think beyond FP10 to boost innovation

The discussion about the EU’s next research and innovation programme FP10 is heating up, and the clamour for a bigger budget is getting louder.

That is understandable, given research funding is critical for universities and research organisations. And many in the research world would certainly want a bigger budget to be focused on basic research.

There is no disputing the importance of having excellent scientists expanding the frontiers of knowledge and ensuring the EU is an attractive place to do research. But the benefits will not accrue to the wider society unless this knowledge is translated into innovation.

Much of the underlying policy debate centres on how to make Europe’s economy more competitive, how to genuinely improve living standards and enable society to cope with climate change and more; and how can we turn knowledge into something of benefit to society.

The challenge for Europe lies not so much in the constraints around R&D spending, but rather on the lack of investment in innovation opportunities that can make use of research outputs.

Many EU-funded projects have spurred hugely promising technologies aimed at addressing climate change, or health, mobility, agriculture and more. But, to translate and scale up these technologies, Europe needs to become a more attractive target for investment, not  just an attractive place to do research.

Europe needs to renew its infrastructure, industrial plants, transport and energy systems on a massive scale. This means governments need to commit to long-term planning and investment that would enable research to actually have impact.

China is constructing new chemical plants: in Europe we are patching up old ones. The former can incorporate state-of-the-art technologies. The latter aren’t worth investing in. In the US, the Inflation Reduction Act of 2022 provides billions of dollars in incentives, grants and loans to support new infrastructure investments in the areas of clean energy, transportation and the environment.

This attracts European industries as well when it comes to decisions on new infrastructure investment related to innovation. If there aren’t opportunities to translate research into industrial use in Europe, the benefits of research paid for by the European taxpayer will accrue elsewhere.

When comparing the EU with the US, we cannot ignore the topic of defence research either. Defence is one of the very few sectors in which the state can create the market pull for innovative products through public procurement. The catalytic effect this has already had for aerospace, ICT, advanced materials, sensors, and other technologies can be experienced every day.

The voice of industrial R&D is more sotto voce than other parties lobbying for FP10. Industrial managers are largely baffled by the type of consultations that are conducted by the Commission. The very high transaction costs involved, versus the actual funding per partner, per project, deters much of industry from participating in framework programmes at all.

Yet, while the voice of industry should not dominate, the expertise that the industrial R&D sector has on the challenges of applying and scaling up of new technologies is needed to ensure that research performed to foster innovation actually achieves its aim.  

High R&D spending in Europe is not sustainable without significant investment in innovation and in infrastructure. A more holistic view of FP10 should consider how research connects to innovation. Big companies need to be coaxed to engage. Certainly, Europe needs more investment beyond what FP10 can achieve, in order to benefit from the opportunity research provides.

Ernst Lutz is president of the European Industrial Research Management Association and chief technology & innovation officer of Bekaert, a specialist in steel wire and coating technologies. He was previously CEO of the EIT Raw Materials, CTO of Grundfos and CTO of Sulzer.