Is R&D spending a victim of austerity?

The Office for National Statistics recently released some data about government spending on R&D (here) and we’ve been having a closer look at it. If you were to ask a UK manufacturer if it’s up or down you could expect a negative answer, as budgets are slashed further each year in this age of austerity. The reality is a bit more complicated. UK public spend on Science, Engineering and Technology in 2013 (the last year we have data for) was £10.9 billion, an increase of 9% versus 2012 and on the face of it good news. It also reverses the downward trend in R&D expenditure that’s been there since 2009, but it’s still far from the pre-recession peak. There are winners and losers within these figures though, so let’s take a quick look at them.

Research Councils stay steady over a longer period

The government funded Research Councils invest in research, covering academic disciplines from medical and biological sciences to astronomy, physics, chemistry and engineering, social sciences, economics, environmental sciences and the arts and humanities. Their budget was increased for 2013, but when you take into account inflation it’s in real terms stayed at it’s 2008 level, following an increase from £2.5 billion to £3.4 billion between 2002 and 2008.  

University R&D spending

A similar story can be seen with UK higher education spending, with a slight increase from £2.1 billion in 2002 to £2.4 billion in 2013, again affected by inflation. The grassroots pressure group Science Is Vital says that the apparent rise is further misleading though, as the total figure includes an increase in capital spending but also a drop in cash funding for science projects.

Who lost out in R&D taxpayer spending?

There have been specific increases in expenditure from 2002, but the overall budget has stayed quite steady, so who has suffered? R&D in defence, dropping £2.1 billion since 2002. It’s subjective and controversial as to how defence R&D should be regarded, but it’s clear this is where the savings have been made. 

Our R&D spending versus our neighbours and competitors

Back to the bigger picture; the overall R&D figures put us in the position of spending the lowest proportion of our GDP on R&D of all the G8 countries (see below), with 0.5% spent, compared to an average of 0.8%, and this doesn’t compare favourably with our European competitors like Germany (0.89%) and France (0.82%) or our cousins across the pond with their 0.86% spend on R&D. We believe research and development is vital to the UK’s future (it’s why we do what we do) and while it’s great to see R&D spending starting to increase again, more is needed to keep the UK competitive.

 

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1:  UK Government Expenditure on Science, Engineering and Technology, 2013

2:  The G8 is: Canada, France, Germany, Italy, Japan, the Russian Federation, the United Kingdom and the United States