Jos Manuel Duro Barroso President of the European Commission

EUROPEAN HIGHER EDUCATION: AN ENGINE FOR GROWTH AND JOBS

Conference on higher education in the framework of Europe 2020 Lisbon, 11 November 2011

Dear Rector and Vice-Rector, Dear Professors, Ladies and gentlemen, It is a pleasure to be here and see so many familiar faces around to discuss the crucial role of higher education in contributing to European Union strategy for growth and jobs. As many of you will know education and Europe's universities are very close to my heart; and how to stimulate economic growth and jobs creation in Europe is today at the core of the European Commission action and priorities. The crisis has hit us hard. But if Europe is to emerge stronger from these difficult times, we need more than ever to stimulate smart economic growth, underpinned by knowledge and innovation as its key drivers. That is the only way to build a more sustainable economy for the future. We also need a sense of urgency, and a collective determination to succeed. Education, research and innovation are at the very heart of the Europe 2020 strategy, our European blueprint to get the economy back on track over the course of the decade. But Europe 2020 starts now. It is now that we have to take the right decisions and implement the necessary reforms to enhance our capacities in education, research and innovation. They are key to addressing major economic and social challenges. So let me congratulate the Jean Monnet Centre of Excellence of the Lisbon University, first of all for having received this label last year, and for having organised now such a timely event. I would also like to thank Fausto de Quadros and Antnio Pedro Barbas Homem for their special contribution. 2

The Jean Monnet action to stimulate excellence in education, reflection and research on European integration in higher education institutions worldwide, is more than ever instrumental for the success of Europe. This is why the Commission will continue to strongly support the Jean Monet programme. [Europe and the new knowledge-based economy] When it comes to higher education Europe has a long and strong tradition stretching back several hundred years. Just look at Lisbon University. It is celebrating its 100 years but the history of a university in Lisbon goes back to the 13th century. However, when we look at the situation today, what do we see? First we see our main competitors abroad ahead of us in investing in higher education and putting many more of their young people through university. Secondly, we see in Europe, the number of skilled jobs outnumbering the supply of students with higher education qualifications. While 35% of all jobs in the European Union will require high-level qualifications by 2020, only 26% of the workforce currently has a higher education qualification. Thirdly, we see that 1 in 5 young European cannot find work now; this is emblematic of our challenge. Our social model depends on this generation being financially able to support Europe's ageing population. The lesson to be drawn is crystal clear: We live in a highly competitive global environment driven by knowledge, innovation and technology. If Europe has to succeed in today's new 3

knowledge-based economy we need to capitalize on our existing strength, amplify our education capital and train a work-force with graduate level skills. Higher education institutions have a vital role to play since they are the only institutions to cater for all sides of the triangle of education, research and innovation. Indeed, higher education performs two critical roles: developing individuals' skills and developing ideas. To make the most of these two key roles is the background to the Europe 2020 strategy and to flagship initiatives such as "Youth on the Move" or "Innovation Union." [Developing individuals' skills] Europe's most precious asset is its citizens and the Europe we believe in is a Europe that gives a chance to everyone to develop one's skills. We cannot afford to lose a generation of young people not being either employed, studying or in training. Young Europeans, too often the ones first and worst hit by the crisis, need to gain knowledge, skills and experience. Europe needs young brains. This is why we have set an ambitious but realistic target on educational attainment in the Europe 2020 strategy. By 2020, we want both to reduce early school leaving to 10% from the current 15%; and increase the share of young Europeans having successfully completed higher education from 31% to at least 40%. 4

Europe also needs equity. This is why access to higher education should be widened to under-represented groups, notably lowersocio-economic groups. It should also support the development of universities as drivers of regional development particularly in less developed regions of the European Union. But this is not only a question of quantity. This is also a question of quality. Our aim should be more and better. It is not enough to focus on expanding schooling attainment if we do not work in parallel on promoting the quality of training. A number of studies have highlighted how educational quality, rather than mere school attainment, is strongly related to the distribution of income and to the economic growth. Promoting excellence in higher education includes measures such as improving the relevance of programmes to labour market needs, rewarding excellent teaching, increasing flexibility in programmes, encouraging mobility and facilitating the cross-border dissemination of ideas and best practices. In a nutshell, all measures which will contribute in training, attracting and retaining the best and the brightest from Europe and from outside Europe. The successful implementation of such measures depends ultimately on the commitment of Member States and higher education institutions. However, the Commission can and indeed do a lot to support Member States in the modernisation of their education and training systems. 5

As European citizens are looking beyond national borders for education and training opportunities, the European Union has an important role to play in ensuring that the opportunities of the single market are made available to all. And as you well know, programmes to promote transnational learning mobility, such as the Erasmus programme, have proven to be a great success, helping people to acquire the new skills that will be needed for the jobs of tomorrow. Three million students will have benefited from the current Erasmus programme by 2013. We will push forward our efforts to promote mobility and cooperation as well as to support internationalisation of higher education. For example, we will soon propose an Erasmus Masters Degree Mobility scheme. And let me remind you that recognition of professional qualifications beyond borders is one of the 12 key actions of the Single Market Act adopted by the Commission in April to unlock the full potential of our internal market. [Developing ideas] Aiming at excellence in higher education is a necessity but it is not an end in itself. As I have said higher education is about developing individuals' skills but it is also about developing ideas. And, more could be done to strengthen the links between education, research and innovation. We have to make the knowledge triangle work better in favour of new socio-economic benefits.

Knowledge, ideas and technology have to be better transferred to those who will turn them into new opportunities for business and society. This means that all stakeholders should aim at ensuring excellence in research and maximising the innovation potential of universities. This also means that partnerships "knowledge alliances" have to be developed between higher education and alliances are key to stimulate growth and create jobs. This is exactly the purpose of the European Institute of Innovation and Technology (EIT), the first European initiative that I proposed in 2005 to boost Europe competitiveness by fully intensifying the interaction and integrating higher education, research and innovation with a strong emphasis on entrepreneurship. Another important objective is the completion of the European Research Area by 2014. We should have by then a real single market for knowledge, research and innovation. research institutions, industries and high-tech centres. Such strategic

[Investing in education] Ladies and gentlemen, Investing today in intellectual capital is the best investment we can do for tomorrow's Europe. This is absolutely key to Europe's destiny. This is an investment to be done now to prepare Europe to firmly stand up to the challenges of a fast-changing world and a demanding global economic environment.

We all know that fiscal consolidation and structural reforms are necessary for stabilising our economies. But we also know that the wrong sorts of cuts could simply send Europe into recession. Fiscal consolidation must go hand in hand with a long-term vision of a stable, competitive European economy which delivers sustainable growth. A former president of Harvard University, Derek Bok, once said: "if you think education is expensive, try ignorance." This means that we also need growth enhancing measures such as education, research and innovation, which strengthens the competitiveness of our industries and create new jobs. There is no doubt that investing in education will definitely help the European Union and its Member States to emerge stronger and more competitive in the global market and to sustain our European social model. Much of this investment will be made at national level. And as the economic crisis has left few higher education systems unaffected, it is important to look at alternative and innovative effective governance and funding mechanisms for the higher education sector to underpin the quantity and quality objectives. In the Commission we are also strongly committed to boost growth and jobs across the European Union by investing more in Europe's brains. This is why we have proposed for the next financial framework programme to invest 15.2 billion in education and vocational training, an increase by 68% in this type of expenditure. We also propose to dedicate 80 billion to research and innovation funding, 8

that is an increase of 46% for this new framework programme "Horizon 2020". More investment in these areas is crucial for Europe's global competitiveness so that we can create the jobs and ideas of tomorrow. Increased investment in human capital and modernisation of education and training systems will help the European Union to become a smart, sustainable and inclusive economy. Ladies and Gentlemen, Through their activities in education, research and innovation, Europe's higher education institutions have the talent, the creativity and the expertise necessary to successfully contribute to Europe economic growth, job creations and world-wide influence. In today's globalised world education, research and innovation will make the difference; it has to be our competitive edge, you have to be our competitive edge. I am confident you will stand up to the challenge and you can count on the continuous support of the Commission. Thank you for your attention (1788 words)