Annexes to COM(2011)52 - Response to the Report of the Expert Group on the Interim Evaluation of the Seventh Framework Programme for Research, Technological Development and Demonstration Activities and to the Report of the Expert Group on the Interim Evaluation of the Risk-Sharing Finance Facility - Main contents
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dossier | COM(2011)52 - Response to the Report of the Expert Group on the Interim Evaluation of the Seventh Framework Programme for Research, ... |
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document | COM(2011)52 ![]() |
date | February 9, 2011 |
To this end the Commission will carry out a major review - to report by the end of 2011 - of its strategy for international collaboration. This will examine how to build critical mass and specialisation, in areas of European need and comparative advantage, taking into account the proposal above (2.1) for a future focus on major challenges. In this context, it will also be essential to better define the common and respective roles of Member States and the Framework Programme as well as the means, such as through the Strategic Forum for International S&T Cooperation, to identify areas of common interest and approaches.
3. OUTLOOK
In the final chapter of its report, the FP7 Interim evaluation Expert Group discusses the implications of its findings and evidence, for the goals and implementation of future funding programmes. It underlines that this will need to support the implementation of the Europe 2020 strategy, including the ambitious objectives in the Innovation Union and related flagship initiatives.
The Expert Group puts forward the three issues of excellence, competitiveness and societal objectives as key to the research agenda and priorities for the next FP. These coincide strongly with the broad orientations put forward by the Innovation Union.
The results of this evaluation will have a direct bearing on future research policy, notably in the forthcoming Commission Green Paper, scheduled for adoption early 2011, to launch a wide public debate on the key issues for future research and innovation funding programmes.
4. RISK-SHARING FINANCE FACILITY (RSFF)
4.1. Introduction to the RSFF and context of its Interim Evaluation
The RSFF was developed at the request of the EU Council in December 2005 which asked the European Commission (EC) and the European Investment Bank (EIB) to propose a financing facility with risk-sharing elements for the support of additional investments in RDI for the period 2007-2013. By pooling up to € 2 billion (up to € 1 billion from FP7; up to € 1 billion from EIB's own resources) in order to cover potential losses on loans provided by EIB and/or its financial intermediaries, the RSFF objective is to leverage around € 10 billion of loans for RDI activities implemented by private companies or public institutions with a higher financial risk profile.
In accordance with Annex II of FP7, the EU financial contribution is broken-down in two parts: a first tranche of € 500 million for the period 2007-2010; and a possible second tranche of € 500 million for the period 2011-2013, subject to an Interim Evaluation.
4.2. RSFF Interim Evaluation
Implementing its work in the first half of 2010, the Independent Experts Group (IEG) appointed to carry out this Interim Evaluation concludes in its report[13] that the RSFF appears as an innovative, anti-cyclical demand driven financial instrument successfully introduced into the European Union’s research funding scheme that helped drastically to expand the financing for RDI. Highlighting that very considerable results on an EU-wide scale have been achieved since its launch, even above initial expectations[14], the IEG also underlined that the implementation of the RSFF has been carried out in a highly efficient and effective way, building enormous knowledge inside the EIB and the EC in managing such a new and commonly assessed financial instrument, and serves as a powerful lesson and encouragement to what can be achieved by the judicious combination of risk-based capital from the EU's budget and EIB’s financial resources and expertise.
Considering that RSFF is a model example to be further developed and intensified, the IEG made 10 recommendations that can be regrouped as follows:
- Current programming period 2011-2013:
- Immediate release of the EU contribution of up to € 500 million to the RSFF under the conditions foreseen in the EC FP7 legal basis – ( Recommendation 1 );
- Additional EU contribution of up to € 500 million to RSFF for 2011-2013 coming from EC FP7 Specific Programme 'Cooperation' and/or non-FP7 resources – ( Recommendation 5 );
- Revolving nature of the EU financial contribution to meet the level of demand until the end of 2013 – ( Recommendation 7 );
- Improvements possible to be implemented for some already supported target groups (in particular SMEs, Research Infrastructures) through introduction of specific approaches and change of risk-sharing – ( Recommendations 2, 3 & 4 ).
- Next programming period post 2013:
- Continuation and expansion of the scale and the scope of the RSFF ('renewed RSFF') with a dedicated revolving EU financial contribution of no less than € 5 billion – ( Recommendations 7, 9 and 10 );
- A certain degree of rationalisation of existing/future EU financial instruments should be targeted (avoiding duplication of efforts and ensuring synergies) – ( Recommendation 6 );
- Regular monitoring to be ensured – ( Recommendation 8 ).
4.3. The Commission's response
The Commission welcomes the detailed and thorough analysis of the IEG.
As a positive interim evaluation of the RSFF is a prerequisite for the release of the second tranche of € 500 million of FP7 funding to the RSFF for the period from 2011 to 2013, the Commission notes that this release is strongly recommended by both the RSFF IEG (recommendation 1) and the FP7 Interim Evaluation Expert Group. By voting the EU Budget 2011, the Council and the European Parliament have already provided their agreement of principle on the release of the second tranche (budget of Euro 250 million for 2011). The Commission however invites them to provide a more formal answer later in 2011, on the whole period (2011-2013), if they deemed it appropriate.
The Commission fully endorses the recommendations 2, 3 and 4 of the IEG to address the needs of currently underrepresented groups in RSFF (i.e. SMEs, universities/research organisations and research infrastructures). Technical negotiations between the Commission and the EIB are already taking place on finding concrete solutions and new approaches on how to achieve these objectives, including in particular changes of risk-sharing, portfolio approaches, increase of risk levels, and introduction of equity funding. This work will lead to an amendment of the EC/EIB agreement on RSFF implementation already in the first half of 2011.
The Commission welcomes the objectives of the recommendations of the IEG regarding the next programming period (post-2013). It notes that they are in compliance with the objectives of the Innovation Union Communication[15] to enhance access to finance; attract a major increase in private finance; and make more extensive use of financial engineering instruments in support of innovation[16]. Analysis is ongoing on how to concretely fund an expansion of the scope of the RSFF to allow for an increase of risk sharing for both R&D and innovation projects and how the EU shall be able to finance and support the implementation of ambitious new objectives (like the SET Plan), including Europe 2020 Flagship Initiatives like Digital Agenda or Resource efficient Europe. The Commission and the EIB Group are currently working on the design of an effective, efficient and rational use of financial instruments, in particular in the area of RDI, with a cross policies perspective.
Finally, the Commission agrees with the recommendation of the IEG on a regular monitoring of the implementation of the RSFF and will undertake concrete action in 2011.
[1] OJ L 412, 30.12.2006, p.1
[2] "Catalysing European Competitiveness in a Globalising World" – Panel report of the FP7 ICT interim evaluation; other relevant evaluations in the domain of ICT include the interim assessments of the ARTEMIS and ENIAC Joint Technology Initiatives (JTIs) and interim evaluation of the Ambient-Assisted Living Joint Programme [3]-.@Ahttp://ec.europa.eu/dgs/information_society/evaluation/rtd/index_en.htm
[4] C/2009/8412-1
[5] http://ec.europa.eu/research/evaluations
[6] Decision 1982/2006/EC of the European Parliament and of the Council – 18 December 2006 – Annex II
[7] Decision 2006/971/EC of the Council – 19 December 2006 – Annex III
[8] Decision 2006/974/EC of the Council – 19 December 2006 – Annex III
[9] Annex II to Decision No 1982/2006/EC, p38
[10] http://ec.europa.eu/research/evaluations
[11] The headline from each recommendation is reproduced here, although the full text can be consulted in the relevant evaluation reports.
[12] http://ec.europa.eu/information_society/digital-agenda/index_en.htm
[13] COM(2010)187 of 29.4.2010
[14] The IEG report has been presented by Mrs Erika MANN (IEG Chair) and Mr Luc SOETE (IEG Rapporteur) to the ITRE Committee of the European Parliament, to the Research Working Party of the Council, as well as to the relevant FP7 Programme Committees.
[15] By end 2009, RSFF loans of € 6.3 billion were approved and total investments in RTDI of € 16.2 billion supported, thus achieving a significant leverage effect of 15 (EU/EIB budget sources vs total investments in R&D and Innovation supported); RSFF projects are located in 18 EU Member States and 2 Associated Countries. Figures for RSFF until September 2010 are: EUR 8.1 billion of approved loans for 82 projects; EUR 5.3 billion of signed loans for 54 projects.
[16] COM (2010)546 of 6.10.2010.
[17] As also highlighted in the Communication "Regional Policy contributing to smart growth in Europe 2020" COM (2010)553 of 6.10.2010.