Lies, damn lies, and statistics
Whenever the Commission cries out for "innovation" or "spending on R&D" it usually follows with a plea for stronger patent protection, having wholly swallowed the dogma that people only innovate because they can earn lovely royalties off their "intellectual property".
Not being entrepreneurs, the Commission does not understand what a market is, nor what it means to compete for customers by making products.
Official R&D figures ignore the SME sector, but that accounts for 80% of the economy according to some figures.
However, given the mess that patent thickets have made of many areas where Europe was meant to be dominant - e.g. telecoms - it'd not be surprising that R&D is slowing down. What's the point of making shiny products when you're likely to be sued? It's easier to retire from product development altogether, pump up your patent portfolios, and let the Asians do the hard and suable work of turning "IP" into actual sellable products.
The irony is that large patent holders in cahoots with the patent industry then lobby for more lax patent examination and stricter patent enforcement regimes, and manage to confuse the poor Commission into promoting this vision in the name of "R&D".
Hmm... let me look into my crystal ball... more so-called "R&D" for large firms (hidden subsidies)... a European Bayh-Dole-style act (turn Universities into patent troll incubators)... push for an European patent judiciary (kill those petulant national courts that insist on observing the letter of the law and discarding software patents)... push for specialised patent courts (where patent experts can jack-up their costs)... help "educate SMEs" in the proper use of IPR (nice business you got here, guv, shame if a patent lawsuit were to 'appen)...