RIO Country Report Austria 2014
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The annual RIO Country Report analyses and assesses the development and performance of the Austrian national research and innovation system and related policies in the perspective of EU strategy and goals.
The report highlights recent national policy and system developments occurring and assesses the match between national policy priorities and the structural challenges of the research and innovation system. It addresses among others:
- The progress of Austria towards achieving the Innovation Union, focusing on areas where action is needed.
- Progress in responding to the ERA actions, particularly in light of the ERA progress report findings published in September 2014.
- Country specific R&D and innovation recommendations as indicated in COM(2014) 400 final '2014 European Semester: Country specific recommendations, Building Growth' adopted by the Commission on 2 June 2014 and endorsed by the Council on 27 June 2014.
- Progress in tackling research and innovation system challenges beyond those outlined above.
- Areas highlighted by the Commission's Communication on 'Research and innovation as sources of renewed growth' (COM(2014) 339 final) and its accompanying Staff Working Document 'State of the Innovation Union, taking stock 2010-2014' (SWD(2014 181 final).
The RIO Country Report 2014 builds on the experience of the ERAWATCH project. The ERAWATCH Country Reports from previous years are also available for download on this page.
Country Report file
The current state of the Austrian economy does not largely differ from the overall state of the Eurozone, both approaching zero growth in 2013. National elections held in 2013 as well as the restructuring of several federal ministries in the context of the new coalition government, to a certain extent, slowed down the introduction of new policy measures, also in R&I policy fields. General public consolidation efforts in the wake of the crisis have led budgetary stability agreements on national and federal state levels, launched in 2012.
Cross-border R&I cooperation is well established in Austria at the level of researchers, research organisations from industry and academia, and research funding agencies. Notably, Austria is an active and important player in a variety of EU level initiatives. In the field of basic research, there is a high propensity and readiness to finance also research conducted outside Austria, e.g. under the D-A-CH agreement. Moreover, the recent coalition agreement foresees a tightening of international strategic S&T partnerships. Consideration of societal challenges in Austrian R&I funding is so far limited.
The national R&I strategy, published in March 2011, emerged from an ex ante consultation process that included all relevant stakeholders. While the strategy does not provide a multi-annual roadmap with budgeting, it makes transparent the political target to invest 3.76% of GDP for R&D by 2020. Furthermore, the strategy committed to a 10% increase of R&D active companies by 2013. A newly launched, national target also aims to increase the annual number of start-ups by three percent and by 2020. Among the most recent policy initiatives are the launch of the national infrastructure action plan as well as the establishment of new regional and thematic knowledge transfer centres (both in 2014).
One main issue at stake are educational outcomes in Austria, more specifically, of disadvantaged young people as well as drop-outs from higher education tracks. In this way, there is a policy focus on maximizing the labour market and innovation potential among women and migrants. Several recent policy measures in Austria address gender specific aspects, namely the “National Action Plan for Gender Equality”. This plan contains a package of 55 measures, of which 35 had already been implemented by end of 2014. Early impact assessments of policy initiatives targeting migrant school drop-outs such as youth and apprentice coaching are rather encouraging.
Austria’s labour market for researchers is fairly open and characterised by a high institutional autonomy, in particular for higher education and other public research institutions. Human resources in science and technology (HRST) are mainly employed in the business and the higher education sectors. Moreover, Austria is among the OECD countries with a relatively large share of immigrants in the workforce and is an attractive location for students from abroad. However, net balances for mobile academics and mobile inventors are negative for the past 15 years, i.e. this constitutes a net outflow of highly-qualified R&D staff.
Open, transparent and merit-based recruitment of researchers:
Academic inbreeding in public research institutions is not frequently observed in Austria. Transparent procedures and advertisement standards, which are regularly checked, often prevent academic inbreeding and assure fair and international recruitment. However, there is no official system in place to establish the equivalence of foreign academic ranks with national ones, whether tenured or non-tenured. Such decisions are often taken on a case-by-case basis. Moreover, language barriers for students as well as for employment of foreign university staff persists as most master and higher level courses are still held in German.
Access to and portability of grants:
Austrian researchers are only allowed to move their publicly-funded grant to another ERA country to a fairly moderate extent as portability largely depends on the specific research funding organisation. In general, grant portability is frequently limited to individual grant merits rather than organisation associated grants. Additionally, scientist affiliation to a recognised institution is often more relevant than residency criteria with regard to individual grant portability. Nevertheless, notably, Austria has one of the more open national funding systems in the EU with respect to funding eligibility for non-resident scientists.
Austria advertises most positions internationally as stipulated by law, including the European Researcher's Mobility Portal. It participates in the EURAXESS initiative with a national portal, several contact points and two service centers. Offers advertised online via the Austrian portal have been constantly increasing in the last few years. More than 300 Austrian research institutions had registered by the end of 2013.
Structured doctoral programmes (“Doktoratskolleg”) have been first launched in 2004 and are increasingly funded by FWF most lately. This main initiative is complemented by existing fellowship programmes run by the ÖAW as well as several self-financed doctoral programmes launched on institutional level by individual universities (“Initiativkollegien” financed via institutional funds). A recent evaluation of the “Doktoratskolleg” concluded with a positive assessment of the programme and only recommended minor changes.
HR strategy for researchers (HRS4R) incorporating the Charter and Code:
Austria is among early adopters in the assignment of the European Charter for Researchers. By 2013, many Austrian research institutions had signed the Charter & Code. Broad implementation of principles at Austrian universities was assured via performance agreements with universities. Regarding implementation within the HRS4R framework, the medical university of Graz, as the first institution in Austria, has been acknowledged as “human resources excellence in research”. 3 other Austrian organisations followed shortly after.
Education and training systems:
Again, gender-specific policies in Austria encompass a variety of support measures, also including specific R&I policies on education. Recent initiatives on school level encourage gender-specific teaching schemes for STEM subjects at school or aim to strengthen female participation in STEM university studies. As regards a higher quality of teachers at schools and universities, an expert group was established on national level in 2013, monitoring progress on on-going reforms (“PädagogInnenbildung NEU”). Moreover, insufficient entrepreneurship education activities are still an issue of public controversy. However, recent policies support the certification of “entrepreurship schools” which help identify best practices and new concepts of entrepreneurial pedagogy.
Not applicable to Austria
e-Infrastructures and researchers electronic identity:
In total, Austrian universities host 16 electronic databases, according to a recent assessment based on the research infrastructure database by the BMWFW. However, these are only provided to third parties to a limited extent (Open for Collaboration). Moreover, the FFG has been funding big data projects since 2013. The internet portal data.gv.at also offers a catalogue of open data records and services from public administration (Open Government Data). This data can be used freely, both for personal information as well as for commercial purposes. Electronic identifiers for researchers in Austria have so far not been assigned, nor systematically collected in a national register.
Open Access to publications and data:
To date, a coherent national policy framework on open access is not in place in Austria, even though already almost half of all scientific papers seem to be published via open access (OA). In 2012, the "OA Network Austria" has been established as a joint activity under the organisational umbrella of the FWF and The Austrian Rectors' Conference (UNIKO). Accordingly, there are different stakeholders taking action to implement and disseminate OA in Austria, and there are already numerous measures being implemented on very different levels (by funding agencies, public research organisations and universities).
Austria ranks very high in terms of its political and regulatory environment according to the World Economic Forum (WEF) Global Competitiveness Index (2013). However, regulatory conditions for start-ups demonstrate a very high level of licensing complexity largely due to the high costs involved (towards public and private sector) and long duration for obtaining licenses. Additionally, existing bankruptcy laws are not very encouraging for experimentation and potential failure among innovating firms in Austria, in particular SMEs. Supply and demand-side policies and instruments have only been coordinated to a very limited extent.
The main funding programme supporting spin-offs from universities, universities of applied sciences and non-university research organisations is “Academia plus Business (AplusB)”, already active since 2001. Only very recently, a number of “Knowledge Transfer and Exploitation of IPR Centres” were established by the BMWFW, with a total volume of €20m. Among other things, the centres support strategic patenting, prototype development and start-up activities at universities and public research institutions that result from basic and applied research. Moreover, the coalition agreement signed in late 2013 foresees several measures reducing red tape for Austrian entrepreneurship.
The private sector finances the largest share of domestically conducted R&D, with an estimated 44% of national R&D expenditure in 2014. The public share in GERD stood at 39%; the share financed from abroad, mainly via foreign companies, accounted for 16%. In order to meet the targeted ratio of financing by 2020, contributions from the private sector in Austria will need to increase at a higher rate than those from the public sector in the next five years. Moreover, the massive expansion of subsidies for corporate research, due to an increase in the indirect research (tax) premium effective in 2011, has caused a major shift in how increases in public funds were used, partially at the expense of funding available for the higher education sector.
Project vs. institutional allocation of public funding:
In general, the allocation and mix of direct public funding seems appropriate. At present, direct funds in Austria are more commonly allocated via institutional than via project-based modes, roughly accounting for 3/4 and 1/4. Moreover, the share of competitively allocated funds weakly increased in the last few years. This was mainly due to subsequent reforms of HEI financing systems (2002 and 2013) which based institutional funding to universities on three-year performance contracts. Furthermore, project-based funding is relatively scarce in the HEI sector, whereas more than 60% of this type are performed by Austrian businesses and frequently granted by FWF and FFG.
In Austria, direct government funding of business R&D and indirect support via R&D tax incentives had a 1:1 relation, according to the latest available data (2011). In an international comparison, the Austrian government is one of the few that does not seem to select or focus on one specific funding approach for private sector activities. However, since 2006, indirect funds have grown much faster than direct funds in Austria and also faster than indirect funds in most other OECD economies. In general, public funds in Austria cover well the entire R&I process stages, from fundamental research to market innovation and are complemented by a large set of policy measures addressing knowledge and technology transfer.
All regions (Federal States) have developed economic and innovation strategies. Having a smart specialisation in place is a pre-condition for regions to be able to spend European Regional Development Funds on R&I (based on new “ex ante conditionality” clause); in this context, Austria will have but one national operational programme for all ESIF (with regional chapters). At the national level, the BMWFW runs complementary initiatives that aim at empowering regional R&I actors. In general, innovation strategies in Austrian regions are frequently adjusted to R&I policies and activities followed on national and EU levels.
Like the majority of EU countries, Austria also addresses knowledge and IPR transfer on a national level through overarching laws on the research system, obliging both research funders and public research organisations to play a full role in supporting national innovation and competitiveness. However, the role of the Austrian Patent Office (APO) as the main stakeholder of public IPR activities has been negatively assessed recently (2013). With regard to public support of IP management across borders, a national contact point (NCP) has been designated in 2010. Notably, Austria is the first MS to ratify the Agreement on a Unified Patent Court in 2013. In the private sector, there seem to be very few IP matchmaking and trading services active in Austria.
Evaluation culture in Austria is well developed in an international comparison. Ex-post, interim and, to a lesser degree, ex-ante evaluations are standard practice at programme, institution and system’s level evaluations in Austria. Eight major evaluations relevant to federal policy and publicly accessible have been undertaken between mid 2013 and 2014. An important stakeholder in R&I evaluation in Austria is the Platform Research & Technology Policy Evaluation (fteval) which e.g. contributes to the further development of evaluation culture by standard-setting.
Knowledge and technology transfer is well established in Austria. There are already various effective policy measures in place, e.g. COMET, COIN, BRIDGE programmes or Christian Doppler Laboratories. Moreover, inter-sectoral mobility as another important transfer mechanism in Austria is still relatively low, although no hard factors restrict mobility of researchers between the public and the private sector. Very few policy schemes address this issue, e.g. the ‘young experts’-programme which supports master theses and PhD theses undertaken in industry.
Austria has been unable to catch up with or even reduce distance to innovation leaders in the past 3 years (Innovation Union Scoreboard 2014), i.e. since the launch of the national R&I strategy. This assessment suggests that Austria performs above average on inputs relevant to the system such as venture capital investments. However, it rather underperforms on specific output indicators, at least in its reference group as well as compared to innovation leaders. Arguably, this implies continuing inefficiencies in the overall science and innovation system.
Main structural challenges of the Austrian system include (i) a weak human capital basis for innovation, e.g. expressed by a low tertiary education rate; (ii) deficits in labour participation, e.g. the labour quota of women, elderly and migrants; (iii) deficits in R&D, e.g. a low number of research conducting enterprises, in particular SMEs; (iv) deficits in finance, e.g. venture capital is still relatively scarce; and (v) competition and industry dynamics bottlenecks, e.g. relatively low start-up dynamics limiting the renewal of established industries and transitioning to knowledge-intensive activities in the economy.
By and large these structural challenges are common knowledge and concrete policy initiatives in various fields in the last few years have proven more or less successful in challenging these bottlenecks. Notably, some valuable trends even emerged without the intervention of policy, e.g. as regards scientific excellence where there is preliminary evidence on high performing research groups and fields in Austrian HEI and PRO. Moreover, R&I Governance in Austria has been improved step-by-step and continues to be systematically developed. Similarly, gender challenges have been successfully identified and now tackled with a coherent and strategic set of measures and new regulations. Other areas of Austrian R&I policies remain weak points in the system and, arguably, should attract more policy attention and a redesign of the policy mix, e.g. public initiatives have so far had a limited effect on the availability of venture capital funds. Moreover, the funding system seems to have lost some of its funding flexibility in times of budgetary pressures, mainly due to a massive increase in indirect allocation of public funds in the last few years.
In general, funding support well-tailored to the needs of SMEs is in place: A major component of Austrian total funding is “indirect” funding and, thus, allocating funds to innovative firms broadly and non-selectivly, using a common system of R&D tax credit. Moreover, like many other EU countries, Austria also offers innovation cheques. Another important research facilitator for SME innovation is the Austrian Cooperative Research (ACR). In terms of innovation-friendly regulation, the bankruptcy system’s effectiveness as an early warning system is relatively low in Austria. In addition, the overall trend suggests that the share of innovative companies among all SMEs has slightly declined in Austria during the last decade and according to the latest available data.
In general, there is a significant lack of private risk capital to finance small, young enterprises with high growth potential, expected to have an effect on employment and structural economic change. Notably, the national government has already launched several initiatives that seek to improve financing conditions for innovation and provide newly founded businesses with sufficient venture capital, in particular innovative SMEs and high-tech start-ups. However, these initiatives have not generated sufficient impact. Furthermore, the new government seeks to improve legal framework conditions of finance and SME access to capital markets according to the coalition agreement signed in 2013.
Innovation-oriented public procurement policies in Austria were substantially activated by European deliberations and initiatives. In the meantime, several initiatives and strategic documents have been launched on national level. E.g. 2013 saw the “greening” of some of the existing national procurement regulation. Most importantly, the Federal Procurement Agency (FPA) set up an innovation-friendly public procurement (IPP) service centre the same year that now serves as a first point of contact and supports pilot projects of interested agencies.
Austria is a small and wealthy EU Member State, with a GDP per capita above the EU average. After experiencing a fast recovery in early crisis years, economic growth has been slowing down since 2012. The Austrian economy is now close to zero growth and thus converges to the EU average. Gross domestic expenditure on R&D (GERD) stood at 2.84% in 2012 and, again, is well above the EU average (approximately 2%).
Activities in high-tech patenting and high-tech exports indicate an overall low- and medium-tech and applied R&D orientation of the Austrian innovation and science system. Continuous R&D activities are mainly concentrated in larger, manufacturing firms. Knowledge-intensive sectors accounted for an average R&D intensity of around 5%. However, this is significantly lower than intensities observed in innovation leader economies. Next to the corporate sector, actors in higher education institutions (HEI) are the biggest research performers in terms of volume.
In 2011, the national R&I strategy "Becoming an Innovation Leader: Realising Potentials, Increasing Dynamics, Creating the Future" has been published. It introduces a coordinated vision and strategy across ministries, while its implementation is safeguarded by several working groups across ministries and external advisory bodies. Moreover, in the wake of the 2013 federal elections, R&I budgets and policies are now mainly conducted by a single, newly established Ministry of Science, Research and Economy (BMWFW). Main funding agencies are the AWS (Austria Business Service), the FFG (Austrian Research Promotion Agency) and the FWF (Austrian Science Fund).
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