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SMART SPECIALISATION THE GOVERNMENT PERSPECTIVE - Cardiff University 28 June 2012 BACKDROP - CHALLENGING TIMES  Economic landscape : recession & Eurozone crisis  EU budget focus on driving high end growth & maximising impact  Concentration of investment on top drivers of growth  UK National Reform Plan targets  Stronger performance management & accountability  More flexibility to align EU funds (regional, social, rural and fisheries) EU ‘COMMON STRATEGIC FRAMEWORK’ INVESTMENT THEMES 1. 2. 3. Innovation and R&D ICT: Improving access; quality and usage SMEs: Improving competitiveness, incl. in the agricultural and aquaculture sectors 4. Shift to low carbon economy 5. Climate change adaptation and risk management 6. Environmental protection & resource efficiency 7. Sustainable transport and unblocking key networks 8. Employment and labour mobility 9. Social inclusion and fighting poverty 10. Education, skills and lifelong learning 11. Improving institutional capacity for efficient public administration UK CHALLENGES FOR STRUCTURAL FUNDS  Increasing R&D spend & ‘localising’ national investment plans (TSB)  Improving access to finance for SMEs  More renewable energy use  NEETS / youth unemployment  Higher level skills  Financing through ‘financial instruments’ (more loans / fewer grants) ‘LESS DEVELOPED’ REGIONS 2014-2020  GDP/head below 75% EU27 average  75%-85% EU co-financing available for wider range of activities  Safety net” of 2/3 of previous allocation for regions moving ‘up’ and out of this category  At least 25% spend must be from European Social Fund  Likely to be West Wales and the Valleys + Cornwall and Scilly Isles ‘TRANSITION’ REGIONS 2014-2020  GDP/head between 75% and 90% of EU27 average  60% EU co-financing  Safety net” of 2/3 of previous allocation for regions moving ‘upwards’ into this category At least 40% spend must be from European Social Fund, of which 70% of each programme must focus on only 4 priorities, with 20% earmarked for tackling social exclusion at national level  80% ERDF to focus on only 3 priorities  Likely to include : – – – – – – – – – – – Devon Lincolnshire East Yorkshire & N. Lincolnshire Shropshire & Staffordshire South Yorkshire Merseyside Lancashire Tees Valley & Durham Highlands & Islands Cumbria Northern Ireland MORE DEVELOPED’ REGIONS 2014-2020  GDP/head more than 90% EU27 average  50% EU co-financing  At least 52% spend must be from European Social Fund, of which 80% of each programme must focus on only 4 priorities  At least 20% ESF to focus on social exclusion at national level  80% ERDF to focus on only 3 priorities: Innovation SME competitiveness Low carbon and energy efficiency (at least 20%) SMART SPECIALISATION: WHAT WE NEED VS WHAT WE WANT  UK strategy for stimulating R&D excellence  Proven track record of world beating innovation  Smart specialisation as a ‘precondition’ for receiving UK ERDF....does not apply...but  We want....Locally transparent and locally engaged innovation / R&D investment decisions.  We want....National innovation investment woven into local investment plans NATIONAL LEVERS: TECHNOLOGY STRATEGY Technology Strategy Board (UK national innovation agency) works with top companies in R&D to:  Accelerate ‘the journey between concept and commercialisation’  Connect the innovation landscape  Turn Government procurement into innovation driver & business opportunity  Invest in priority areas based on potential to generate sustainable UK economic growth TSB DELIVERS THROUGH....  Technology & Innovation (Catapult) Centres  Demonstrator Projects : Innovation Platforms (eg. Low Carbon Vehicles)  Support for networking & collaboration (incl. Knowledge Transfer Networks)  Support for SMEs (Grant for R&D, Knowledge Transfer Partnerships, Eurostars)  Procurement : driving innovation through government procurement LOCAL LEVERS?  Universities  Private sector R&D  Social / business innovation? ? SMART SPECIALISATION: How do we deliver local impact from a partnership between national & local investment in innovation ?  Need to avoid cathedrals in the desert + suboptimal fragmentation KEY QUESTIONS  What will shift the economic game?  How will the difference be measured?  How much & when?  Fuzzy boundaries?: o Different partnerships for different issues? o Different geographies for different issues?  Leadership? Governance?