An ambitious project has been launched by the Italian Department for Development and Cohesion Policies, involving Italian national and regional policy makers.  The aim: co-designing Innovation policies under EU Structural Funds for a multi-level coordination, in Gov 2.0 style.

The context: EU Regional Policy and Innovation

In many EU Countries, especially in the lagging areas of the East and the South of Europe, European Cohesion Policy is the main source of funding for Research and Innovation policies, and new Europe 2020 flagship initiative “Innovation Union” aims at strengthening and further developing the role of EU Structural Funds 2007-13 to support innovation. While the European Social Fund (ESF) is dedicated to the development of human capital, the European Regional Development Fund (ERDF), as stated in the European Regulation No 1080/2006, contributes towards the financing of productive investment and infrastructures as well as the development of endogenous potential through measures which support regional and local development.
Each EU region inserts its policy objectives in its regional Operational Programmes or in a shared National or Interregional Programme. For each regional objective, the selection criteria of projects are set out by a dedicated Managing Authority.
In the case of Italy, with their ERFD regional Operational Programmes (OPs)
– all regions have programmed funding for research projects carried out by enterprises (in collaboration with research centres or other enterprises) and for innovation in enterprises; 13 OPs include actions for the creation of new businesses in the emerging sectors
– 19 regions intend to empower research infrastructures, equipment and instrumentation to support R&I supply, and to create clusters and structures for technological transfer (innovation poles, technological districts, competence centres)

The total amount of resources dedicated to Research, Innovation and Information Society by all Italian Operative Programmes 2007-2013 exceeds 20.7 billion Euros. 70% of these resources are concentrated in only 5 Regions of the South: Campania, Puglia, Sicilia, Calabria and Basilicata. This is the highest amount of money ever managed by those regional authorities for this particularly difficult kind of policy.

A specific action for inter-regional coordination in Italy

In 2008, the Department for Development and Cohesion Policies (DPS) of the Italian Ministry of Economic Development – responsible for Structural Funds in Italy – launched a technical assistance project dedicated to the Italian Regions of the Convergence objective (the five regions mentioned above) and aimed at sharing good practices of policy implementation in the field of Research and Innovation. In particular, academic support was offered to tackle critical issues, such as empowering strategic design capability and project selections, in itinere and ex post evaluation, the efficient use of conditionality and result-driven funding. Eight working groups were created, involving more than 100 representatives of regional administrations plus the central ministries and agencies responsible for national innovation policies. 
I dedicated a post to some of the high-level conclusions the final report of the first phase of the project (2008-09), in which you can also find not only regional data on structural funds in Italy, but also methodological advice and examples of good practices.
A new phase of the project has just been launched: “Sostegno alle politiche di ricerca e innovazione delle Regioni” (“Support to regional Research and Innovation policies”). The new wave is promising more in-depth analysis of current trends of regional policy for Research and Innovation. Moreover, central and local policy-makers are actively involved in order to co-design policies, to share implementation practices and to draft policy documents and templates ready to be used in day-to-day activities. It’s up to a few thematic working groups to produce drafts of grants, strategies, evaluation studies, implementation processes, etc. in true ‘Gov 2.0’ style, e.g. through the use of tools for on line collaboration.
To date, four working groups, coordinated by high level experts and practitioners, have been focusing on at least six policy issues:
1. Technological foresight and regional policy
2. Selection and criteria for research projects
3. Conditionality and funding of projects
4. Pre-commercial Public procurement
5. In itinere evaluation indicators
6. Ex post evaluation indicators
You can download the powerpoint presentations of the project on the website of the National Agency for Innovation (Agenzia per la diffusione delle tecnologie per l’Innovazione), in Italian.

Innovation policy needs multi-level coordination

But the scope of these activities could not be limited to national boundaries. The ‘secret agenda’ of Andrea Bonaccorsi, professor of Economics at the University of Pisa and coordinator of the project, is to connect Italian regional authorities to the European regional network, and import innovative ideas from the most advanced EU regions.
The rationale is clear. From a regional point of view, it is useless and dangerous to let national or EU plans identify long-term regional policy goals and research priorities by simply ‘copying’ the most fashionable EU or national ideas into local strategies and plans. For example, it is evident that focusing on biotechnology, ICT or nanotechnology may not be the best strategy for all European regions; but this seems to be the case if you take a look at regional policy documents. Instead, Prof Bonaccorsi suggests to apply the ‘smart specialization’ approach to regional priority setting. The effort should be concentrated on specific sectors and niches of application by combining General Purpose Technologies such as ICT with locally generated competencies. 
In other words, regions must find their true vocation, and the experience of other advanced European territories might prove fundamental. The increasing interest toward territory-based innovation policies is demonstrated by the growing regional percentage of public expenditure for Research and Innovation in most OECD countries, especially in those countries where regional governments have greater autonomy (see figure above).
The concept of smart specialization was first introduced by Dominique Foray, Paul A. David and Bronwyn Hall – experts of the Knowledge for Growth group (K4G) working for the President of the European Commission – and then embedded in Europe 2020 strategy. Regional specialization implies a multi-level governance to coordinate different, place-based policies at national and regional level. An on-going research project by the OECD and the European Commission identifies some of the main barriers to a seamless policy-making process at national level:
– low political and technical capabilities of local institutions,
– duplication of competencies and plans and
– the presence of policy gaps (policy areas not covered).

Towards a bottom-up approach to policy coordination

Now, how to realize multi-level coordination?
While multi-level governance can be improved trough political agreements or the creation of dedicated agencies, the value of this kind of projects is to provide good examples of a bottom-up approach. People involved in policy implementation from different regions – along with national technical bodies – are given the chance to meet their peers and share knowledge, as happens in a true community of practice. I can’t wait to see the results.