UK science budget: Cuts of at least 20 per cent in the pipeline
Government and business expenditure on research and development in the UK compare poorly with the majority of G7 countries and both have fallen consistently over the 20 years from 1989-2009.
Business enterprise R&D as a percentage of GDP in the G7
| 1989 | 1999 | 2009 | |
| Canada | 0.73 | 1.06 | 1.00 |
| France | 1.35 | 1.36 | 1.37 |
| Germany | 1.96 | 1.67 | 1.88 |
| Italy | 0.71 | 0.50 | 0.65 |
| Japan | 2.01 | 2.14 | 2.53 |
| UK | 1.46 | 1.22 | 1.12 |
| US | 1.84 | 1.96 | 2.02 |
Government intramural expenditure on R&D as a percentage
of GDP in the G7
| 1989 | 1999 | 2009 | |
| Canada | 0.28 | 0.21 | 0.19 |
| France | 0.53 | 0.39 | 0.36 |
| Germany | 0.35 | 0.33 | 0.41 |
| Italy | 0.26 | 0.20 | 0.18 |
| Japan | 0.23 | 0.30 | 0.31 |
| UK | 0.29 | 0.22 | 0.17 |
| US | 0.42 | 0.29 | 0.30 |
Unfortunately, the analysis of government activity is more limited than in previous years because the coalition government has not published data on research and development employment patterns within government.
The 2009 SET statistics showed:
- a 16 per cent fall in the number of people employed on R&D in research councils
- a 35 per cent cut in civil departments and
- 55 per cent in the MOD.
Given the extensive programme of job cuts currently in progress, it seems highly likely that this capacity will shrink further.
Data published by the House of Lords Science and Technology Select Committee in summer 2010 do not provide grounds for optimism. At that time, many key departments did not know their planning assumptions for employing analytical professions – which does not suggest that specialist staff are given appropriate priority.
Where planning assumptions are available, they generally anticipate a reduction in staff numbers, as shown in the numbers of analysts in government departments.
It is evident that government departments still face significant challenges in quantifying the numbers of science and engineering staff they employ, let alone their areas of specialism.
Departmental expenditure on Science, Engineering and Technology
Net government expenditure on SET by departments in real terms 2000-01 to 2009-10, shows that while science budget expenditure has grown significantly over the last ten years, this growth is weighted towards the first half of this period.
Some research councils, such as the Natural Environment Research Council, have seen little or no growth in budgets since 2005 and the total science budget shrank in real terms by 0.8 per cent.
By contrast, civil departments overall fared better in the second part of the decade, from 2005-06, but with some notable exceptions.
For example, the SET budget for the Department of the Environment, Food and Rural Affairs rose by 12.5 per cent between 2000-1 and 2005-6, but fell by 68.4 per cent in the following five years – leaving the department with 47.4 per cent per cent less in real terms in 2009-10 compared with its budget at the start of the decade.
The Scottish government’s SET budget fell by 6.4 per cent in real terms between 2005-6 and 2009-10, offsetting an increase of 24.9 per cent in the previous five years.
Real terms SET expenditure by the Welsh Assembly government in 2009-10 was at only one third of the level in 2000-01.
However the most stringent and sustained cuts have been in Ministry of Defence SET expenditure, which has fallen by over 60 per cent in the years since 2005-06. Spending on development has been particularly harshly affected, falling by 79.6 per cent, although research expenditure has also been cut by more than one quarter.
Departmental expenditure on research and development
Net government expenditure on R&D by departments in real terms 2000-01 to 2009-10, shows a largely similar picture for expenditure on R&D, though departments have been differentially affected.
For example DEFRA suffered a 21 per cent cut in R&D expenditure at the end of this ten-year period compared with the much larger fall in SET expenditure of 47.4 per cent.
For the Department of Health (excluding the National Health Service) the position is reversed. Here a 40 per cent cut in SET expenditure between 2000-1 and 2005-6 was offset by a proportionate increase in expenditure in the second half of the decade.
There was no such compensating increase in R&D expenditure with the result that spending on R&D had fallen by 40.8 per cent by the end of the decade.
Departmental expenditure on external research
Data provided to the House of Lords Science and Technology Select Committee in summer 2011 shows that the majority of departments that had made plans at that time also planned to reduce their expenditure on external research. The Department of Health and the Department for International Development are obvious exceptions.
Other departments indicated that such expenditure is not planned in advance but depends on emerging policy priorities.
Definition of the science budget
Looking ahead, prospects are fundamentally affected by a change to how the science budget is defined.
As the Campaign for Science and Engineering has shown, in the 2010 spending review, the science budget excluded capital spending but included Higher Education Funding Council research spending.
So while government committed to freeze the newly defined science budget at £4.6bn over the spending review period, under the definition used in the 2007 spending review there is a £0.5bn cut in cash terms over this period.
This equates to a cut of just over 12 per cent compared with 2007 spending plans and of just over 8 per cent after taking account of the £200m funding cut in the 2010 spending review.
Total science budget (cash terms)
| Defined by | 2007 spending review | 2010 spending review |
| 2010-11 | 3,924 | 4,576 |
| 2011-12 | 3,736 | 4,576 |
| 2012-13 | 3,545 |
4,577 |
| 2013-14 | 3,523 |
4,577 |
| 2014-15 | 3,628 | 4,576 |
| percentage change 2010-11 to 2014-15 | -8.16 | 0 |
The actual impact on spending power is of course higher after taking account of inflation. Even on the SR 2010 definition, and taking at face value the government’s statement that the budget has been frozen, there is an estimated real terms cut of 14 per cent on the basis of projected changes in the Consumer Price Index (CPI) over the spending review period.
However, as CASE point out, inflation in science and engineering may be higher than indicated by the overall trend. The US government uses a Biomedical Development Price Index which, in 2010, grew three times faster than the overall inflation index. So, in all, a science budget cut of 20 per cent or more is in the pipeline.
The table below shows just how significantly the change in definition affects research council capital budgets.
Research Council budgets (cash terms)
| Defined by 2007 spending review | ||
| Resource | Capital | |
| 2010-11 | 2,680 | 393 |
| 2011-12 | 2,774 | 340* |
| 2012-13 | 2,754 |
199 |
| 2013-14 | 2,769 | 199 |
| 2014-15 | 2,780 | 181 |
| percentage change 2010-11 to 2014-15 | 3.6% | -117.13% |
Note: * includes additional £100m of investment announced in March 2011 budget
Notes:
• SET is defined to include research and development creative work undertaken on a systematic basis in order to increase the stock of knowledge; technology transfer activities associated with research and experimental development; and scientific and technical postgraduate education and training.
• R&D is measured on the basis of the Frascati manual i.e. basic research undertaken primarily to acquire new knowledge of the underlying foundation of phenomena and observable facts.
Applied research i.e. original investigation directed primarily towards a specific practical aim or objective.
Experimental development work i.e. systematic work drawing on existing knowledge gained from research and practical experience that is directed to producing new materials, products or devices; to installing new processes, systems or services; or to improving substantially those already produced or installed.