Three billion good reasons to innovate

The EU’s Competitiveness and Innovation Programme (CIP) is intended to show that innovation is not just about new technologies.

The €3.6 billion programme offers funds to people hoping to invest in a range of business-oriented innovation projects. These can range from new computer technologies to more unusual branches of innovation, such as innovative management structures.

It widens the scope of activities previously funded under the EU’s enterprise and environment programmes, as well as the Commission research department’s central framework programmes.

"The CIP was set up to improve the links between innovation, competitiveness and entrepreneurship," explained a Commission official. "The framework programmes focus on purely technical innovation. CIP was needed because innovation can be broader than that."

The programme runs from 2007 to 2013: the same period as the seventh framework programme for research (FP7).

It is broken into three chapters: entrepreneurship and innovation (€2.166bn), ICT policy (€728m) and ‘intelligent energy’ (€727m). The Commission says this means a 60% increase in the money spent on "actions related to competitiveness and innovation", compared with 2006 levels.

The CIP reflects an increasing political interest in environmental projects. As well as the intelligent energy programme, eco-innovation is eligible for €430m of the entrepreneurship funding.

It puts an emphasis on small businesses. Simplified rules and support networks were built into the programme to help small- and medium-sized enterprises (SMEs) compete with big companies.

Luc Hendrickx, director of enterprise policy at the SME umbrella group UEAPME, said the new programme was welcome.

"We always said the Commission should use a broad definition of innovation," he said. "When the Lisbon Strategy was agreed in 2000, everyone’s focus on innovation changed. It was no longer exclusively about new or high technology."

He said it was too early to say whether the programme had improved EU innovation activities, with the first batch of projects funded by CIP up and running for less than six months.

Hendrickx said that UEAPME did not bid for money this year, but was drafting a tender for 2008.

"We’d like to see the Observatory of European SMEs re-launched," he said. The observatory ran up to 2004, collecting data on small enterprises and identifying room for development and innovation.

"The observatory hasn’t been running for three years now," said Hendrickx. "At the moment we don’t even know how many SMEs there are in Europe." Evidently, even the most modern approach to innovation still has a few missing links.

The EU’s Competitiveness and Innovation Programme (CIP) is intended to show that innovation is not just about new technologies.