The National Council for Research and Development in a serious report: the government is neglecting R&D and letting it deteriorate

A number of negative trends have been identified, which over time may harm the development of the R&D system and the economic growth fueled by it * Government participation in R&D is almost half of the OECD average

In a report submitted yesterday (Sunday) to the Minister of Science, the Knesset's Science Committee and the Prime Minister, the Chairman of the R&D, Prof. Oded Abramski, writes: "The governments in Israel do not have an overall policy on the subject of R&D and there is no multi-year planning." Prof. Abramsky pointed out that in Israel, where R&D plays such a central role for the economy and society, it is important that the government lead multi-year planning of the national R&D policy.

In the report, Prof. Abramsky writes, among other things: "The National Research and Development Council examined the structure of the R&D system in Israel and the prevailing development trends in it in order to establish a policy that will ensure the preservation of the existing achievements of the system and its continued growth in the future. A number of negative trends have been identified, which over time may harm the development of the R&D system and the economic growth that is fueled by it, among them: the decline in student achievement in the education system as reflected in the results of the PISA tests; the aging of senior academic staff in universities; Shrinking funding sources for basic research; The "brain drain" phenomenon caused in part by the difficulty of finding suitable employment in R&D in Israel; The absence of significant R&D activity in traditional industry branches; The ongoing decline in the government's share of R&D funding in academia and industry; The paucity of resources invested in the governmental research system operating in the fields of national infrastructure (water, energy, natural treasures, transportation, etc.); The lack of coordination between the various R&D systems and the lack of a government R&D policy for the long term."

Growth in R&D investments has moderated

The national expenditure on research and civilian development carried out in Israel has increased in real terms almost threefold since 1990. Between 1990 and 2000, the national expenditure on R&D grew at an average real rate of 8.0% per year. This was the decade in which the great immigration from the former Soviet Union arrived and in which the rapid growth of the information technology (ICT) industries took place. The growth in R&D spending continued almost continuously during the current decade at a more moderate average rate - 3.1% per year. The increase throughout the reviewed period occurred, most of it as a whole, in the business sector.

However, this investment was made mainly by the private sector. The share of the government sector in financing the national expenditure on R&D gradually decreased from 35% in the mid-90s to 16% in 2006 (the last year for which there are final statistical data). In recent years, the decline is also expressed in absolute terms: in 2001, funding for R&D by the government sector amounted to NIS 5.3 billion, and it decreased to NIS 4.6 billion in 2006. Partial estimates, recently compiled by the Central Bureau of Statistics, indicate Possible change of the above trend in 2008.

The need for government funding stems from three main reasons: first, most of the return from investment in R&D is expressed in the national economy as a whole, and it is not profitable for private parties to invest in the basic stages of research; Second, there is no market mechanism that can regulate investments in R&D related to products and services in which the main activity is currently in the public sector, such as health services, education, water and electricity; And thirdly, the investment in R&D is largely a long-term investment and its viability for the national economy depends on the strategic planning of the investment, and especially the building of the human, physical and organizational infrastructure for R&D.

The size of the gap that exists in Israel in the scope of government funding for R&D can be confirmed by comparing it to other developed countries. In the member countries of the OECD, the governments finance an average of 29% of the national expenditure on R&D, while in Israel the government funding constitutes only 16% of the national expenditure on R&D.

The report was compiled by Naftali Arnon, the Council's advisor, under the guidance of Prof. Abramsky. It will be brought up for discussion at one of the upcoming meetings of the Science and Technology Committee of the Knesset.

Summary of the report
A. The state of research and development (R&D) in Israel

Israel is considered a country rich in R&D and technology. Some of the indices used to evaluate the scientific and technological strength of countries place Israel in a very high place among the developed countries. Israel ranks first in the world in terms of the ratio between the national expenditure on R&D and the gross domestic product and in terms of the proportion of people employed in R&D in the business sector. It is also ranked among the first places in the proportion of people with post-secondary and higher education in the population, and in the number of scientific articles published in the scientific press in the world in relation to the size of the population.

Economic studies point to the close relationship between investment in R&D and innovation and economic growth. Indeed, Israel has a highly developed science and technology industry that is considered the main growth engine of the Israeli economy in the last two decades. Israel is recognized as a center of technological entrepreneurship and Israeli ventures benefit from financing in large volumes from venture capital companies from Israel and abroad. Due to the availability of a developed R&D system and high-level research personnel, leading multinational companies (IBM, Intel, Microsoft, Motorola, etc.) preferred to establish R&D centers in Israel.

Israel has branch science and technology ties at the international, interstate and interinstitutional level. Hundreds of Israeli researchers take part in the R&D programs of the European Union.

Israel is a partner in international research facilities including the European Molecular Biology Laboratory (EMBL) and the European Synchrotron Facility (ESRF). Israel also participates in the activities of the Facility for High Energy in Geneva (CERN) as an observer.

Israel was admitted in May 2010 as a member of the organization ^[1]OECD. Since 1997, she has participated as an observer in over ten committees and working groups in fields related to R&D within the OECD.

The government of Israel has signed bilateral agreements for scientific and technological cooperation with nearly thirty countries, including the USA, Germany, France, Great Britain, India and China. Among others, binational research funds operate with the USA (BSF, BIRD and BARD), Germany (GIF), South Korea, Singapore, Canada and Great Britain.

All the universities and some of the other research institutions in Israel have cooperation agreements with research institutions abroad. The number of active agreements exceeds five hundred.

The National Research and Development Council examined the structure of the R&D system in Israel and the prevailing development trends in it in order to establish a policy that would ensure the preservation of the existing achievements of the system and its continued growth in the future. A number of negative trends have been identified, which, persisting over time, may harm the development of the R&D system and the economic growth that is fueled by it., and among them: the decline in student achievement in the education system as reflected in the results of the PISA tests; the aging of senior academic staff in universities; Shrinking funding sources for basic research; The "brain drain" phenomenon caused in part by the difficulty of finding suitable employment in R&D in Israel; The absence of significant R&D activity in traditional industry branches; The ongoing decline in the government's share of R&D funding in academia and industry; The paucity of resources invested in the governmental research system operating in the fields of national infrastructure (water, energy, natural treasures, transportation, etc.); The lack of coordination between the various R&D systems and the lack of a government R&D policy for the long term.

B. Council activity through committees

A significant part of the Council's work is done through the appointment of a large number of committees in which, in addition to the members of the Council, a long list of senior scientists and other people with extensive experience in the various fields of activity took part. As part of the summary, only a brief mention of each committee is given.

1)     The National Committee for Research and Development Policy in Israel: Chairman of the committee: Mr. Yigal Ehrlich. The committee's role is to design a comprehensive and principled statement regarding the manner and scope of R&D activity in Israel. This committee began to deal with two main issues: 1) Diversification of the areas of activity rich in knowledge and innovation by identifying Israel's comparative advantages in areas other than ICT and examining ways to promote them. The areas examined are: energy, environment, water, food, health and internal security. 2) Preservation and encouragement of research for his name. This research, which is at the base of the pyramid of technological research and development, is mostly carried out in universities. It is highly dependent on budgets originating from outside the universities and suitable financing mechanisms must be developed for its preservation and development over time.

2)    The Committee for National Research Infrastructures: Chairman of the committee: Prof. David Horn. The committee established benchmarks for defining national research infrastructures, which are essentially centers of equipment essential for the advancement of research, which are high in cost and must be open to cooperation and accessible to all relevant researchers. The definition also refers to participation in multinational frameworks. In addition, the committee initiated a comprehensive survey on what is desired and what is found on the topic of infrastructure. The committee is coordinated with TLM - the inter-ministerial and inter-institutional body engaged in pooling resources to build national infrastructures for R&D.

3)    The National Committee for the National Data Set on R&D in Israel: Chairman of the committee: Prof. Yadin Dodai. One of the main tasks of the council is to establish a set of data, usually quantitative, that describe and document the R&D activity in Israel in all its aspects. This system is intended to be used by the council for the purpose of designing the R&D policy and the research community and the general public. The aforementioned committee examines and approves the work plans and monitors their execution. Currently, more than 20 surveys are in the planning and execution stages with a total budget of about four million shekels - more than half of the total budget available to the council.

4)    The National Committee for Academia and Industry Relations: Chairman of the committee: Prof. Moshe Oron. The committee dealt with several important points in the interface between academia and industry in Israel. It is worth noting that this interface is a fundamental element in Israel's success in the hi-tech fields in recent decades. The committee focused on the issue of the transfer of academic knowledge to industry and the cooperation between them. The committee also dealt with the issue of intellectual property, where its initial conclusion was that at the level of government policy there is no place for legislation in this area, but rather there is a need to create a dynamic of multiple application-oriented studies in systems that the government supports or owns.

5) The National Committee for the Coordination of International R&D Relations: Chairman of the committee: Prof. Mina Teicher. The committee found it appropriate to begin its work by mapping the scientific activity in an international context at the state and institutional level. This is due to the necessity of the mapping for the purpose of fulfilling the committee's duties, which include: characterizing missing ties at the state level, identifying international funding options, recommending the preferred fields, entities and countries for developing R&D ties, and the like. Mapping is currently in an advanced stage.

6)    The National Committee for Coordination between Civil R&D and Security R&D: Chairman of the committee: Brigadier General (res.) Uzi Elam. The committee chose to focus on two subjects where there is an interface between civilian and defense R&D, tiny robotics and energy sources. In this context, the committee initiated two technological surveys on the aforementioned subjects and completed the planning of the surveys and the selection of the implementing bodies. The surveys are to be carried out in 2010. The committee is also examining the idea of ​​establishing a dual-use national laboratory (civilian and security) and is in the process of commissioning a feasibility study on this issue.

7)    The Committee for Examining the Government Research Institutes and the Status of the Chief Scientists in the Government Ministries: Chairman of the committee: Prof. Yehudit Birak and Prof. Avraham Friedman. At the current stage, the committee is dealing with the issue of government research institutes. The committee focused on questions of principle related to the justification and conditions for the existence and functioning of a government research institute. The committee reviewed the research centers within the government and submitted an interim report that includes a number of recommendations, among them: to give the institutes the status of a government reference unit; establish a steering committee for each institute headed by the chief scientist of the institute's parent office; The desired budgeting profile is that public funding constitutes most - but not all - of the required funding.

8)    The committee for examining government research in the field of agricultureChairman of the committee: Prof. Ilan Hat. The committee's work focused on the academic-research side of the Volcanic Institute and the Office of the Chief Scientist of the Ministry of Agriculture. The committee's recommendations point to the need to see as a main task applied R&D for the benefit of the agricultural sector and the Israeli economy. This also includes reference to the food industry and environmental aspects. Infrastructural research as well as overseas R&D will be carried out within the output mix determined by the Institute's management. A significant part of the government budget should allow for the renewal of equipment and conducting research at the initiative of the institute's management. The recommendations also refer to the professional advancement of the researchers and the cooperation with academia and industry.

9)    The National Committee for Research and Development in the field of energy: Chairman of the committee: Prof. Leah Bem. A preliminary review of the field, carried out by the committee, revealed that the R&D activity in the field is decentralized, while in the matter of energy, the most benefit can be obtained by concentrating efforts in areas where the uniqueness of the Israeli economy can be identified. In this context, the committee is preparing to conduct a survey to map the state of R&D in Israel in the field. On the basis of what is known today, the committee identified several promising areas, mainly in the field of solar energy, among them photovoltaic systems for electricity production, solar air conditioning systems, concentrated solar energy and energy storage. Other areas mentioned: systems for producing heat at moderate temperatures, fuel cells, extracting distillates from oil shale, "green" construction.

10)           The National Committee for the Advancement of Research and Development in the Life Sciences and Medicine: Chairman of the committee: Prof. Hermona Sorek. The committee saw its role as the interface between academic research in universities and hospitals and industry, in characterizing the capabilities of the research and in searching for real and implementable ways in a short time to translate them into industrial R&D and industry. The committee focused on examining capacity against priorities, examining models for funding biotechnology and defining the characteristics of a national project. About a year and a half ago, the committee characterized a survey which will examine the capabilities in the field of life sciences and medicine in institutions of higher education and research institutes and at the same time examine the biotechnology industry in Israel. Until the completion of the survey, the committee began to conduct a limited survey on its own.

11)           The committee for examining research in the government health system: Chairman of the committee: Prof. Ehud Razin. The committee examined the research carried out in the various units of the Ministry of Health or funded by it and referred to organizational, operational and professional aspects of the research. In the interim report of the committee, which has not yet dealt with the research being done in the government hospitals, The committee defined the research goals in the Ministry of Health and emphasized the need to strengthen the position of the chief scientist in the Ministry. The committee also recommended increasing the ministry's involvement in the institutes it participates in funding and the restructuring of several units that deal with epidemiological surveys.

third. General activity of the council, conclusions and recommendations

The council held plenary meetings once a month. Some of the meetings were devoted to meetings with the leading factors in the field of R&D in Israel ^[2] For the purpose of exchanging information and receiving assessments regarding the issues at hand in the field of national R&D policy. Other meetings were devoted to the discussion of the reports of the sub-committees and the issues brought up for discussion by the council members. Based on all of the above, the council formulated conclusions and recommendations that were detailed in plans and position papers that were submitted to the relevant decision makers and published in the media. Below is the summary of the council's recommendations (in addition to the recommendations of the sub-committees approved by the council plenary and detailed above). The detailed plans and position papers are presented in the current report in chapter 6.

1)    A series of recommendations submitted in March 2009 to Prime Minister-designate Benjamin Netanyahu

The recommendations referred to initiatives in the field of R&D as part of steps to deal with the economic crisis and especially to prepare for stable growth in the phase of exiting the crisis. The recommendations referred to the following areas:

• Development and upgrading of national infrastructures for R&D
• An initiative to bring back Israeli scientists and engineers from abroad
• Targeted and significant support in selected industrial fields (within the Chief Scientist programs of the Ministry of Science and Technology) in order to increase innovation and competitiveness.
• The promotion of R&D in universities in accordance with the recommendations of the Shohat Committee, and the promotion of targeted R&D in academic colleges and research institutes.
• Strengthen education for excellence in order to create a scientific-technological reserve for the State of Israel.
• A general recommendation for increasing the government budget to encourage R&D, science, technology and innovation as part of the measures to deal with the economic crisis.

2)    Position papers and recommendations submitted by the council:

• A program for the return of Israeli scientists and engineers living abroad - the program was approved by the government and is in the stages of detailed planning by an inter-ministerial team led by the Ministry of Immigrant Absorption.
• Position paper regarding R&D in the higher education system - the recommendations were partially approved by the government
• A specific position paper regarding R&D in academic colleges.
• Position paper on fostering quality and excellence in the education system.
• Position paper on encouraging industrial R&D.
• Position paper on space R&D.
• Position paper on R&D in alternative energy.
• Recommendation for an additional budget for bi-national research funds - the recommendation was partially approved by the government.
• Recommendation for the establishment of a venture capital fund for biotechnology - the plan was approved by the government and its implementation began.
• Recommendation for the establishment of a national fund for medical sciences - the plan has been approved and is being implemented.

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[1] OECD - the Organization for Economic Cooperation and Development, which brings together all the countries with a developed market economy (the United States, Canada, Western European countries, Japan, Australia, etc.).

[2] Meetings were held with the chief scientists and directors of institutes in the government ministries, with the heads of higher education institutions, with directors of research funds, with managers and R&D personnel from industry and with heads of government, public and private bodies engaged in enriching youth in science and education for excellence.