1 Government policy for research and higher education

1.1 Introduction

The Government has high ambitions as regards the Norwegian knowledge society. In line with the Sundvolden Declaration, the Government will pursue a targeted commitment to research and higher education. Norway has many good academic environments, along with a highly developed business community in a number of areas, but we have the potential to be even better. In addition to a general commitment to quality in research and higher education, the Government will prioritise special efforts in world-class science. This is necessary to stimulate more breakthroughs and greater international visibility for Norwegian research, as well as to benefit from the knowledge found among the foremost international experts.

Knowledge and expertise are among our most important competitive factors. New insight and recognition together with capable people with sound skills form the foundation for how we deal with major social challenges. This is also the basis for facilitating value creation, both in the public and private sectors. Research and education impact the economy by enhancing the quality of the workforce and the services delivered, and enabling us to develop and adopt new solutions and products. This in turn contributes to adaptability and increased productivity. A knowledge-based approach is essential in finding solutions that can address many of the challenges facing our society. Some examples of this are a change-over to green growth and adaptation to climate change, improved health treatment methods, and how we can produce safe, healthy food. We also need knowledge that brings new recognition and helps us understand social development.

The effect of investments in research and higher education depends on how the investments are oriented. Increased investments must be arranged so they result in improved quality in research and higher education. This long-term plan outlines a framework for how the Government will reinforce research and education to meet the challenges and seize the opportunities in the Norwegian knowledge society in the period from 2015 to 2024.

1.2 An ambitious and predictable escalation

The Government wants to increase research and development (R&D) appropriations to 1 per cent of the gross domestic product (GDP). The objective is to increase R&D appropriations beyond the growth in GDP each year until the goal is achieved. Given the current outlook for future GDP growth, the Government aims to attain this goal in the 2019–2020 period. The Government will scale up appropriations to research and higher education within six long-term priority areas:

• Seas and oceans

• climate, environment and clean energy

• public sector renewal, better and more effective welfare, health and care services

• enabling technologies

• innovative and adaptable industry

• world-leading academic groups

As part of this commitment, the Government will augment some of the most important input factors in the research and higher education system during the period from 2015-2018. The Government will:

• fortify recruitment with 500 new positions

• increase appropriations to research infrastructure by NOK 400 million

• raise appropriations to programmes that stimulate good Norwegian participation in the EU Framework Programme for Research and Innovation, Horizon 2020, by NOK 400 million

Modern and functional building facilities with up-to-date equipment are required to achieve the objectives in the long-term plan. In its follow-up of the long-term plan, the Government will assign particular priority to two construction projects which support these long-term priorities: new building for Life Sciences, Pharmaceutics and Chemistry at the University of Oslo, and an upgrade of the Ocean Space Centre in Trondheim.

The Government will embark upon following up the long-term plan with an appropriation of more than NOK 660 million in the 2015 fiscal budget. The Government proposes targeted efforts including support for the Programme for User-driven Research-based Innovation (BIA), Commercialising R&D Results (Forny 2020) and leading global expertise based in Norway, cf. Proposition 1 S (2014–2015) for the Ministry of Education and Research.

The long-range priorities in the long-term plan are solidly anchored in national research and innovation strategies. They also have broad support in the 150 inputs on the work received from the Norwegian community, business and industry and the academic world during the development of the plan. These priorities are an expression of the Government's commitment in areas where Norway enjoys strategic advantages such as natural resources, strong industry clusters or top-notch expert communities. The resources are to be devoted to research and education at a high international level, including research and education that supports business development and productivity. The plan also contains priorities which elevate areas where there are major, unmet needs for knowledge and expertise. A common feature for all priorities is that efforts will be intensified in areas where research and higher education can make a significant contribution toward handling challenges or in creating and seizing opportunities.

1.3 Why does Norway need a long-term plan for research and higher education?

The long-term plan is a new tool in research and higher education policy. The long-term plan has ten-year objectives and priorities. It also contains more concrete goals for the efforts in the initial four-year plan period. The Government aims to review the long-term plan every four years.

In its publication OECD Science, Technology and Industry Outlook2014, the OECD points out two typical characteristics of countries with highly-developed research and innovation systems. The first characteristic is that these countries pursue long-term investments in the knowledge base; that is to say, through investments in human resources (education, recruitment and capacity building) and equipment (such as laboratory equipment, data pooling, large-scale facilities for measurement and observation in connection with research and education). The second recurring characteristic is that these countries bolster competitiveness through prioritised efforts to address major social challenges.

Long-term, prioritised commitments create predictability and contribute to more coordinated policies for research and higher education. However, there must be a balance between the need for predictability through long-term priorities and the need for flexibility, which provides a window for seizing opportunities we cannot foresee. If management is too detail-oriented, this could tie up resources in measures and policy instruments that impede renewal, and that do not address the problems they are intended to solve. Detailed management also impairs the ability to exploit knowledge about challenges and needs that can be found within the various academic groups. The long-term plan creates predictability in two ways. First, the long-term plan has ten-year objectives and priorities which provide clear signals for the academic community, industry and the public sector. Second, the Government is signalling a commitment to follow up the long-term plan in the annual fiscal budgets. The long-term plan contains both a concretisation of the resource input for recruitment positions, research infrastructure and instruments designed to contribute to good participation in Horizon 2020, and an ambitious goal for growth in appropriations to research and development, wherein measures to follow-up the long-term plan are to be prioritised. This provides opportunities for the business community, academia and the public sector to mobilise for cooperation. This also provides a better opportunity for a long-term perspective when these entities are to develop their own strategies and commitments.

Several parties have noted that coordination of Norwegian resource policy is not good enough, including the Office of the Auditor General, the OECD in its innovation assessment of Norway and Technopolis in connection with an evaluation of the Research Council of Norway. The long-term plan is an important tool for improving coordination and implementation of research and higher education policies. Chapter 9 of the plan addresses coordination and follow-up in greater detail.

1.4 Government objectives for research and higher education policy

The Government's objective is to earmark 3 per cent of GDP for research and development by 2030. Public R&D funding will be raised to 1 per cent of GDP. Long-term, predictable frameworks for public funding will also be geared toward facilitating more R&D in business and industry.

Source

OECD Main Science and Technology Indicators 2014-1

Previous white papers on Norwegian research policy have provided a general outline of the Norwegian research system. Report No. 30 (2008–2009) to the Storting Climate for Research listed nine objectives for Norwegian research: five strategic objectives and four overarching objectives. The strategic objectives represent global challenges, better health and health services, research-based welfare policy and professional practice, knowledge-based industry throughout the country, as well as industry-relevant research in strategic areas. The four integrated objectives are a well-functioning research system, high-quality research, internationalisation of research and efficient use of results and resources. These goals were continued in the white paper Long-term perspectives – knowledgeprovides opportunity (Meld. St. 18 (2012–2013)).

The Government has set three overarching objectives for the long-term plan for research and higher education. These are consistent with the objectives in the two previously mentioned research white papers, but the long term planfurther elaborates the priorities for which areas will receive greater focus. The priorities for research and higher education are also linked more closely. The three objectives are:

• enhanced competitiveness and innovation

• tackling major social challenges

• developing research communities of outstanding quality

The objectives are inter-connected. Development of products, processes or solutions that contribute to addressing major social challenges can, in many cases, also be a springboard for business development, improved profitability and greater innovation. Furthermore, the effects will be magnified by access to excellent candidates and cooperation with world-renowned expert communities.

Enhanced competitiveness and innovation capacity

Skills and knowledge-based assets are important competitive factors for the Norwegian economy. This is true for all modern economies, but is a particularly prominent factor in Norway because our cost level is far higher than that of our trade partners. The ability to develop, absorb and apply knowledge is a significant competitive factor. In many cases, we cannot be the cheapest, but we can work smarter and we can compete on products and solutions that deliver a level of quality which in turn warrants a higher price. This applies both for industry as well as the public sector. Norwegian industry needs innovation and adaptability to secure jobs and value creation in the future. The public sector needs innovation and adaptability to reinvent itself and deliver good social welfare services that society can afford to fund in the future. The Government will therefore prioritise resources for research and higher education that contribute to the objective of competitiveness and innovation within all of the priorities in the long-term plan.

Research on economic development and private investments in R&D reveal that public support plays a substantial role. The business community tends to under-invest in R&D without public investments, due to factors related to market failure and system failure. Frequently cited examples are high risk, the need for a long-term perspective, the fact that gains resulting from R&D often devolve to others, including competitors, and the intrinsic unpredictability of research results. The Government's point of departure is, nevertheless, that enterprises are the best judge of their R&D investments as regards their own competitiveness.

The Government allocates public investments to institutions that conduct research, such as universities, university colleges and institutes. These entities carry out fundamental and applied research with a long-term perspective, and train competent experts for posts e.g. in the business community. Public investments must also contribute toward making it more attractive for business and industry to invest in research and development. This may include programmes that reduce risk and stimulate research and development in the business community, such as programmes that promote cooperation between universities and university colleges and the business sector, and programmes that foster research excellence with relevance for business and industry. Programmes that stimulate growth of new enterprises and economic adaptation are also needed.

Tackling major social challenges

Many countries pursue targeted research and higher education that will contribute to addressing major challenges facing society. This is also the case in the European research and innovation programme called Horizon 2020. Global challenges such as climate change, security and preparedness, disease and epidemics, safe access to energy, water and food are huge and complex. The challenges posed by changing demographics will put the welfare state under pressure. Addressing these social challenges will require coordinated efforts across various professional communities and sectors, as well as international cooperation.

While these are comprehensive global challenges, the problems can often be specific and local. For example, municipalities must care for a growing percentage of elderly citizens who require care. Investing in new care facilities is a traditional approach. However, if good options are available for sound and effective home-based services, the municipality may be able to help its elderly population to achieve better, more active years in their own homes, while saving on investments in new buildings. New solutions are also important in being able to work smarter and more effectively in maintaining sound welfare, health and care services. Such solutions can be created through smart application of new technology.

Knowledge is put to use where people, organisations and cultures meet. The success of new solutions, whether they involve change, adaptation or new technology, requires a wide range of perspectives from the humanities, health and care disciplines and social science. This is crucial in achieving greater understanding of which solutions can actually be implemented in our society, and how this can best be accomplished.

Source OECD: Green Growth Indicators 2014

Source Thomson Reuters/CWTS: Web of science, adapted by NIFU

Norway must be prepared for the challenges we will encounter, but we must also see the opportunities that arise as a result of this development. For example, climate change and environmental impact are some of the most comprehensive challenges we face in the next few decades. We must understand and adapt to the upheavals which will come, and we need new knowledge and technology to reduce emissions. The demand for change creates opportunities for business development and innovation. We must exploit these opportunities so that the overall costs of essential change are as low as possible. The number of patents for environmental technology (also called green technology) has risen substantially, cf. Figure 1.2, but a great potential remains for business development in this area. The priorities in the long-term plan support the need to understand these social challenges, contribute to addressing them in an optimal manner, and to exploiting the possibilities.

Developing excellent academic communities

Norway lags behind countries we tend to compare ourselves with when it comes to measuring the quality of research. Norwegian scholars are quoted less frequently than colleagues from other Nordic countries. Evaluations and reports that assess the quality of Norwegian research and higher education reveal overall good quality in Norwegian academic communities, with certain important variations. Regular assessments conducted by the Research Council of Norway show that quality varies between disciplines and between institutions. Some of the environments are outstanding while, at the same time, there are too many academic environments that do not conduct research of acceptable quality. High quality is therefore a consistent objective. In this context, the Government is working e.g. to examine the future structure and funding system of the higher education sector. The objective is for some institutions to attain a level where they can compete with the very best Nordic institutions, and more research groups should be able to assert themselves with the world elite. Public resources shall be used to promote research and education of top-notch international quality.

The Government is therefore escalating its efforts to develop excellent specialist environments. A research and higher education system with consistently high quality is necessary if we are to develop and utilise knowledge. While we are devoted to assisting the very best, it is also important to ensure good terms for high-quality research that is not part of a global elite class, but which is important in the development of quality education and social welfare services. Vibrant, high-quality specialist environments will attract the best students and researchers.

1.5 Flexibility for the future

Norway devotes considerable State resources to research, development and higher education. We will spend around NOK 53 billion on these areas in 2015. The Government will continue to increase appropriations, but that will not suffice to achieve these objectives. Where and how we invest are of great importance, along with how national and regional measures and programmes work in harmony with European and other international measures and programmes.

Investments in research and higher education must have a long time perspective as these areas are, by nature, long-term commitments. It often takes quite some time before results of public sector investments become visible. It takes time to build laboratories and teaching facilities. It takes time to develop and refine outstanding academic environments. It takes time to establish good IT tools and collaboration systems which provide these specialist environments with the necessary terms and conditions for excelling in a global context. This long-term perspective means that it is not possible or desirable to micro-manage policies ten years into the future. We cannot know for sure which measures and systems will be best suited to address all of the challenges or opportunities presented in the long-term plan. History has shown us that surprising breakthroughs with subsequent rapid change make it difficult for us to know whether today's disciplines, technologies or industries will yield the best solutions.

It is impossible to predict exactly which effects we will achieve, or lose out on, if the investment level is increased or reduced. Nevertheless, firmly established research in economic development indicates that the totality of investments in research and higher education has a significant impact on economic growth, welfare, employment and sustainable development.

The concept that investments in knowledge are crucial for growth and social prosperity is also characteristic of European cooperation on research and innovation work. This is particularly apparent in the Horizon 2020 research and innovation programme. The reasoning behind the extensive public investments is that research and innovation activity should contribute to realising the Europe 2020 strategy objective of the EU becoming a smart, sustainable and inclusive economy. Norway shares the same objectives for research and education as our international partners, in a great many areas. This is one of the main reasons why extensive international cooperation is both useful and necessary. There is no “Norwegian cancer” or “Norwegian Alzheimer’s disease”. It would be counter-productive for each country to work independently to solve these types of problems. International cooperation allows us to share the burden of major investments in e.g. laboratories, data acquisition and other equipment. At the same time, it provides us with the opportunity to recruit talented people from all over the world. Norway is integrated in the international system for higher education, research and innovation through the Nordic and European collaborative efforts. A good balance is thus necessary between public investments in national and international policy instruments for research and higher education.