The main share of government funding is traditionally channelled via institutional funding of universities: In 2012, 59 percent were given to universities as so-called basic funds (“basismidler”) while 49 percent were handed out on a competitive basis (“konkurrenceudsatte midler”). The most important competitive funding instruments are managed by the two research councils, the Danish Councils for Independent Research (DCIR) and the Danish Council for Strategic Research (DCSR). The funding via the research council system increased from 2008 – €292 million – to €350 million in 2010, but decreased in 2012 to €272 million (DASTI, 2013).
In June 2009 a political agreement was reached on a new distribution model of core funding to universities. The new model is a modification of the former model, which covered indicators for education, external funding and PhD graduates. The new model also includes bibliometric indicators and was introduced stepwise over the period 2010-2012. In 2013 it was agreed to continue the distribution model for five more years. The principles for the bibliometric indicator are summarised in a report published by the DASTI in October 2009. The most recent results for the bibliometric indicators are published on the homepage of DASTI.
Bottum-up project funding is either transferred to the universities directly or channelled through the Councils for Independent Research. The Councils for Independent Research are an umbrella organisation for five research councils, and supports research projects (competitive funding) based on the research initiatives of the researchers themselves. The main source of funding is the Ministry of Science, Innovation and Higher Education.
Several governmental strategies have strengthened the R&D specialisation of Denmark in food, biotechnology, climate and energy, such as the Climate Adaptation Strategy, the Danish Business Strategy on Climate Change, the Green Growth agreement, the Energy Agreement 2012-2020, and the Energy Strategy 2050.
The Climate Adaptation Strategy (2008) included a research strategy and the establishment of a coordinating unit for research in climate adaptation to ensure that Danish climate research addresses adaptation issues to a greater extent and to promote cooperation and knowledge-sharing among the research centres.
The Danish Business Strategy on Climate Change (2009) shows ways of exploiting growth opportunities arising from climate change by developing, disseminating and utilising Danish climate-related solutions. The strategy focuses on entrepreneurship, commercialisation, demonstration and public-private cooperation on green solutions.
The Green Growth agreement (2009) states that a high level of environmental, nature and climate protection goes hand in hand with modern and competitive agriculture and food industries. The agreement includes research and innovation initiatives within agricultural and food sectors aimed at making them more dynamic, and including environmental technologies related to the industry. The Green Development and Demonstration Programme (GDDP) was established as a follow-up of this.
The Energy Agreement 2012-2020 was reached in March 2012. The Agreement contains a wide range of ambitious initiatives, bringing Denmark closer to the target of 100 percent renewable energy in the energy and transport sectors by 2050. The Agreement encompasses large investments up to 2020 in energy efficiency, renewable energy and the energy system which implies considerable investments in innovation activities in these areas.
The Energy Strategy 2050 of the Danish Government sets out a strategy aimed at making Denmark independent of fossil energy sources by 2050. The strategy identifies three tracks, and one of them is research, development and demonstration, followed up by large demonstration and preparation for the market and finally the utilisation and integration in the transport and energy system.
The RESEARCH2020 catalogue which was published in June 2012 contains a presentation of five visions that are intended to represent strategic research horizons to be pursued until the year 2020:
In the cross field of research and innovation, the former Ministry of Science, Technology and Innovation has introduced several measures to foster R8D collaboration between public research organisations and business enterprises, with the overall aim of stimulating greater R8D investments in the private sector. These policy measures are intended to enhance the R&D intensity of Danish firms and are administered by the Danish Council for Technology and Innovation. These types of policy measures include Innovation consortia, Innovation networks, Knowledge voucher and Research voucher for SME and the Knowledge Pilot Initiative.
One target for Danish innovation policy has been the commercialisation of public research that results in new, R8D intensive firms. The framework conditions for new R&D intensive firms have been addressed systematically. Several new policy schemes for improved framework conditions were implemented in 2008, such as Proof of Concept, the AcceleRace programme and the Gazelle Growth programme.
To stimulate performance of R&D activities in firms that do not perform R8D yet the improvement of human capital in Danish enterprises is essential, i.e. vocational and further education and lifelong learning. One of the challenges involved in achieving the national R8D investment targets in the business sector, is the need for increased employment of R&D personnel in the business sector, especially in SMEs. Important policy instruments which support this process include the Industrial PhD Initiative and the Knowledge Pilots.
Attracting inward R&D foreign direct investments (FDI) is not prioritised by the Danish government.
The promotion of private-public R&D cooperation is covered by a broad range of measures, such as the establishment of the Business Innovation Fund, support for the Danish National Advanced Technology Foundation (DNATF) and the Danish Council for Strategic Research (DCSR), and the start of Green Labs DK subsidy programme, which will be run by the Ministry of Climate and Energy with a funding volume of €28.2m over the next three years. In 2010 a new initiative for the strengthening of entrepreneurial universities was launched. This initiative is supported by the Danish Growth Council, the Danish Enterprise and Construction Authority and the Danish Agency for Science, Technology and Innovation.
Business Innovation Fund and Market Development Fund:
A Business Innovation Fund (“Fornyelsesfonden”) of €100 million has been established in the period 2010-2012 with the aim of supporting innovation and market maturity within the green and welfare areas. The Fund has since then been converted into the Market Development Fund (“Markedsmodningsfonden”) which helps firms bringing their new products to the market faster and which makes it easier for public-sector institutions to obtain innovative solutions. An amount of €20m is allocated for the Market Development Fund each year from 2013 up to and including 2015.