A report submitted by the Minister of Science, Technology and Space to the Prime Minister calls for the preparation of a five-year national plan for research and development * The report warns of economic damage due to the constant erosion of R&D budgets in Israel
This week, Wednesday, April 24, 2013, Minister of Science, Technology and Space Jacob Perry submitted to Prime Minister Binyamin Netanyahu a comprehensive report on the deteriorating state of research and development in Israel and the need to allocate additional budgets for investment in science, hi-tech companies and technological and scientific innovation.
The report was compiled by a science and technology forum chaired by the chairman of the National R&D Council at the Ministry of Science, Prof. (resp.) Yitzhak Ben-Israel, and including leading members of the research and development system in Israel: the chairman of the Planning and Budgeting Committee at the Education Council High School - Prof. Manuel Trachtenberg; President of the National Academy of Sciences Prof. Ruth Arnon; Chief Scientist at the Ministry of Science, Technology and Space Prof. Ehud Gazit; Chief Scientist at the Ministry of Economy Avi Hasson; Head of the Administration for Research, Development of Weapons and Technological Infrastructure at the Ministry of Defense - Ophir Shaham Institute; and the head of the National Economic Council in the Prime Minister's Office, Prof. Eugene Kendall.
Minister Perry joined the call of the forum members who signed the report to the government to maintain the continued excellence and originality of the research and development system in Israel, and their warning of the severe consequences expected for the economy if it is harmed by the ongoing erosion of the budget.
"Precisely now, in the midst of an economic and budgetary challenge faced by the government, we must secure the development and research reserves of the Israeli economy and academia. Without a strategic five-year plan, Israel will soon lose the assets of human capital and knowledge that it has accumulated over the years," wrote Minister Perry in his address to the Prime Minister and Cabinet Ministers.
In Minister Perry's address to the Prime Minister, he wanted to emphasize the conclusions of the authors of the report that "we urge the new government to take action and re-raise the flag of research and technology, for the benefit of the economy and society in Israel. It is appropriate that this field be recognized as a strategic field of national importance, which is high on the government's priorities. We are aware of the obvious budgetary difficulties, but along with fiscal responsibility and for the sake of a strong economy, we must ensure that the engines of growth will return to full force."
"Accordingly, we call for the preparation of a national five-year plan for research and development that includes a multi-year budget outline embodying an annual increase of 4% in the R&D budgets. Such an outline is necessary in order to keep pace with the countries that compete with us, and to prevent a real economic slowdown that comes from the loss of sources of growth," the report states.
The authors of the report note that despite Israel's past successes in the fields of science and technology, "we are forced to warn that research and development in Israel currently operates mainly due to the inertia of past activity and that the future is shrouded in fog. This is in light of the continuous erosion of the status of research institutions in the last twenty years, which is reflected in the reduction of the budgets directed to research and development (both civilian and military) - a reduction whose severe consequences we will feel well in the coming years."
For example, the authors of the report made a comparison between the growth rate of government spending on research and development in Israel relative to a group of leading countries in the fields of academic research and industrial innovation such as the USA, Great Britain, Finland, Sweden, Switzerland, Japan, the Netherlands, Canada, Denmark and Germany. The comparison shows that these countries increased the government budgets allocated to research and development in the last decade by about 4.5% per year on average. During that period, the Israeli government increased the budgetary part dedicated to research and development by only 0.7% per year on average. This slow growth resulted in the government investment in R&D in Israel, as part of the total civilian R&D, being among the lowest in the OECD.
The authors of the report note that the State of Israel continues to lead the list of countries that invest in research and development relative to their size in terms of a percentage of GDP, but most of the investment comes from the business sector, which tends to downplay risks and does not finance breakthroughs that require long-term investments.
According to the report, in the intense competition that currently prevails in the global economy, "a country that does not address this issue of strategic importance will be left behind in a short time. The meaning of slowing the pace in the R&D race is the flight of minds and businesses - both foreign and local - at a high economic and social price." Therefore, according to the authors, there is a vital need to ensure stability and increase the scope of funding the research and development systems funded by the government.
The report presents alarming data on the state of the research and development system in Israel:
In relation to the rate of government funding from the national R&D expenditure in Israel, it appears that foreign bodies are the source of funding for about 42% of the national R&D expenditure in Israel - this is the highest rate among the OECD countries. In contrast, the government in Israel is responsible for funding only 15% of it, i.e., the lowest rate among these countries.
In relation to university R&D in Israel, the report states that there has been a process of constant erosion for over a decade, which is reflected in the fact that the share of higher education in carrying out R&D in Israel has decreased from 20% in 1997 to only 12% in 2011 . For comparison, only South Korea has a lower rate (11%). If defense R&D is taken into account, Israel falls to the bottom of the list among the OECD countries.
Another erosion trend in university R&D is expressed in the significant decrease in university R&D expenditures also as a percentage of GDP, which fell from 0.73% in 2003 to 0.58% in 2010. This is in contrast to the upward trend in this index in most OECD countries.
This budget erosion results, among other things, in a constant decline in Israel's share of scientific publications in the world and in relation to the OECD countries. There has been a constant decline in Israel's ranking in publications per capita, falling from first place in the world in the early 90s to 13th place in 2011.
As for government spending on R&D, the report states that in 2009 the government focused on indirect funding of R&D within the government allowance for higher education institutions (44%), and direct funding of industrial (38%) and agricultural (7%) R&D. Another 8% of the expenditure was earmarked for the promotion of general research and social services. The remaining five percent were divided between health, infrastructure, space, natural treasures, environmental quality and energy.
However, the state budget proposal reveals only part of the amounts designated for R&D. The rest of the allocations for R&D are included in general budget items. "This situation", write the authors of the report, "makes it difficult to hold a substantive discussion on the government allowance for R&D as part of the state budget discussion".
The authors of the report support increasing the budget for the Chief Scientist in the Ministry of Economy and point to studies that show that the economic benefit of government support for industrial R&D is extremely high: the rates of return on government support for R&D (the Chief Scientist's grants in the Ministry of Economy) are very high and range from 500% to over 1000% Moreover, the government support creates new research and development activity in the economy on a significant scale, which would not have been carried out without it, and creates a significant and distinct addition to R&D in the economy. Also, there was a significant spillover of knowledge between firms in Israel, a finding which, according to the report, is another justification for government involvement to stimulate firms' R&D investments beyond the level at which they would operate without government support.
With regard to the VTA budgets directed to academic research, the report claims that although they have increased but slightly over the years, the increase was mainly, in absolute numbers, in the budget directed directly to the universities, through the budgeting model. The budget has only increased by about 30% in the last seven years (at constant prices). However, Lott has made rigid future commitments on a large and growing scale, for participation in the European R&D program and for membership in CERN and SESAME. The increase in these investments does not lead to an increase in the amount of resources directed to Israeli researchers in academia. Therefore, this is an effective reduction of the available budget for academic R&D in higher education.
The report points out that the success of the reform plan of OT to get academic research in Israel back on track and place it at the forefront of global research, requires the preservation of OT's available budget for academic R&D and means to continue and even accelerate the trend of absolute budget growth of OT for R&D Academic P in the following years.
One response
Well, we have to finance all kinds of nationalist and anti-nationalist religious derivatives...