This article is part of our special report Innovation.
SPECIAL REPORT / The head of the European Institute of Innovation and Technology (EIT) said that concerns in Parliament about the management of funds is a historic issue. He is confident that the Budapest-based institution will be able to overcome the concerns of MEPs.
Peter Olesen has been chairman of the EIT governing board since 2014. He served as the chairman of the Board of the Danish Council for Strategic Research (2008-2014) and previously occupied a number of research-related executive roles in the private sector. From 2009-2011, he was professor of plant biology and biotechnology at the University of Copenhagen.
He spoke to EURACTIV’s Jeremy Fleming at the EIT’s annual innovation forum, in Budapest, on Tuesday (5 May).
Do you think there are problems in the communications and relations between the various players of the Knowledge Innovation Communities (KICS) based on cultural differences and corporate jealousy?
I think such problems are one of the big things at the beginning of a KIC, when people are developing a pre-consortium. But in the end once they make a final proposal, the process of getting this together seems to help companies become more open-minded. But there can be tensions on and off, especially when a project emerges within a KIC and they need new negotiations to incorporate it.
Apart from two KICS set to launch next year – sustainable food, added value manufacturing – what further KICS are in the pipeline?
For the moment, there is one more KIC set to launch in 2018 – a KIC on urban mobility – though the EIT will be subject to a review in mid-2017 [by the Commission] and hopefully we will launch the new KIC in 2018, subject to the review.
What will the review be considering?
They will look at the performance results from the existing KICS. They will ask what have they achieved, whether the model is working, examine features of the co-locational nature of the KICS – which bring together players from different member states – and see if these are running smoothly. They will also asses the key feature of the KICS: the knowledge triangle between business, education and research, and see what impact this is having. For example, are we succeeding in making universities more entrepreneurial?
We expect that in the 2017 [review] there will be a focus on quantifiable issues. We have already been using key performance indicators in assessing the KICS: such as the number of students used in KICS; the numbers of ideas generated; the number of start-ups that have emerged.
In the end, assessing impact will be about how much more entrepreneurial the system has become, whether we have countered job losses and contributed to economic growth. These are more abstract concepts and we will be working with the KICS over the next year to help determine how the early outcomes can be described in performance indicators.
There is a separate persuading job you have to do with the European Parliament in the meantime
What is being discussed [by the Parliament] relates to outstanding issues around governance and management. That is something from the past relating to the beginning of the EIT that needed to be fixed. We are very confident that by September we will be able to satisfy the Parliament’s concerns on this.
The Commission has indicated it wants to raid the EIT budget for the seven-year period from 2014-2020 to help fund the European Fund for Strategic Investment (EFSI), the funding vehicle of the so-called Juncker investment plan. Have you now accepted that this is inevitable?
The question remains open since the details of the Juncker plan are still being debated in trilogue, although the Commission has signaled it wants to achieve agreement by the end of June. It is hard to accept because we have a credibility issue with our partners. The proposed cut (€350 million over the seven year period) from €2.7 billion down to €2.35, would represent a 13% decrease, which is a lot, it would mean that there are things we would have to stop doing. The proposed funding decrease would affect investment over a shorter term period, compelling KICS to accept a decrease in funding next year for example.
Nevertheless you have indicated that the cut could actually turn out to be positive!
I have been working in corporate life for 25 years, and I have seen many times that when you get a cut it hurts you, but it can also make you more creative and focus on more important things. The mere fact of seeing a threat can make people more creative in finding solutions. Part of the KICS non-EIT budget usually comes from other funders or private sector, and maybe it will help them move towards more financial sustainability.
Are you discussing how the KICS could deal with the decrease?
We do have dialogue with the KICS on how to reduce their funding, but there is no one-size-fits all approach, because they are all different and work in different ways. They might be able to transfer some budgets from one year to next, ask their partners to invest more. The announcement of the funding hit came as an unfortunate Christmas present last year, and we are now working it into a reality.
If you do lose the money, is there any way that the EIT could look to recoup some of its loss from the Juncker Plan itself?
I do not believe that there will be a full guarantee of that but there are certainly opportunities to get the KICS recognised as eligible vehicles for funding under the plan. To that end we have started a dialogue with the European Investment Bank and Fund.