Prime Minister Vladimir Putin holds a meeting of the Government Commission on High Technology and Innovation in Zelenograd
20 december 2010
Vladimir Putin’s opening remarks:
Good afternoon, ladies and gentlemen,
Just recently, on December 1, we held a government meeting on the performance of state-run funds that support research and development. I suggest we revisit these issues at this meeting of the Government Commission on High Technology and Innovation.
Let me remind you that construction of this facility began in a bare field in 2000. The first building was constructed and work has continued since then. It is going well on the whole. I would like to note that these state-run funds perform three jobs. First, there is support for fundamental science. This was followed later by support for innovative small and medium-sized businesses, which ultimately became a second, independent aspect of their work. Third, there is support for research in the humanities.
During the trying years when funding for science and research was scarce, these funds played a positive role by providing targeted support to the most important, the most needed research.
In total, these funds have financed about 120,000 projects. They have helped publish over 4,500 research papers and carry out more than 1,000 research expeditions.
These funds have also been providing support for young researchers. For example, there is a very popular programme for creative young people called the Youth Science and Innovation Contest. Fittingly, the acronym for the programme’s name (in Russian) spells ‘umnik’ (or ‘smart person’ in Russian). Under this programme, more than 4,000 innovators have received about one billion roubles for their businesses.
It should be noted that the Development Fund for Small Businesses in the R&D Sector is closely cooperating with Vnesheconombank, Russian Venture Company and the RusNano corporation. In fact, together these development institutions form the infrastructure for innovative and high-tech businesses.
We understand that these funds are important and needed. This is why we have set aside over 10 billion roubles for them this year. They received the same funding, or even slightly more, in 2009. In fact, in 2009 and 2010 we remained where we stood in the pre-crisis year of 2008. In 2011 we intend to allocate 11 billion roubles from the federal budget for these funds.
This money should be spent reasonably and carefully on truly breakthrough research projects, on various research teams’ unique and original ideas and on encouraging innovation projects with commercial prospects.
I would like to underscore that there are a number of tools that the government and private businesses in Russia can use to foster the development of science and innovation. I’m referring to government programmes, targeted research and development funds (which are companies in which the government is a stakeholder), and private investment and venture funds.
It is important for these state-run funds to find where in this science and innovation support system they are most needed and where there are no alternatives to them.
These funds should not become mini-ministries or double the functions of government scientific bodies or academies. Nor should they work according to governmental patterns and templates. They should not fear changes. Their work should be guided by today’s realities and, most importantly, they should foster direct dialogue with the people their work is meant to benefit – researchers and research teams. The cornerstones of these funds should be publicity, transparency and accountability to the public. I would like to speak about several issues related to this point.
First, it is important to work closely and actively with those who apply to these funds for grants, consult with them and help them fill out paperwork so that bureaucratic formalities do not impede the process.
Second, researchers need to understand how their applications will be evaluated and what guarantees there are that the evaluations are unbiased. There must also be a way for them to find out the result at the end of the evaluation.
There should not be even the slightest cause for researchers to allege that the grants are awarded only to projects submitted by people who are close to the fund. Therefore, it is important for evaluations to be independently and randomly checked.
Third, these funds should become even more open. My request is that you post on the internet not only applications and projects that have been awarded grants but also reviews of all the applications submitted so that experts can see what applications were submitted and which one was awarded a grant.
Naturally, the web portals of these funds have to provide complete information on the practical results of projects benefitting from government assistance.
Fourth, I believe that medium-term plans for all state-run funds have to be drawn up. These plans have to include performance criteria. We raised this issue at the government meeting on December 1.
The process of preparing and implementing these plans has to be as transparent and public as possible and should involve representatives of scientific circles.
In addition, I propose setting up a system to monitor how the results of government-funded projects are put to practical use. The money is spent, results are achieved. So, what are these results? Are they gathering dust on shelves somewhere or on computer sites and are not being used at all? Or have these results been put to practical use and are contributing to the real economy or to the advancement of basic research? We need a system to monitor the practical outcomes of these projects.
Finally, today we will choose the topic for our commission’s next meeting. I know that there are some proposals. Please tell me about them.
Let’s get down to work.
Let’s start with expert review. I was discussing this with Mr Fursenko (Minister of Education and Science Andrei Fursenko) on our way here today. He believes that the expert review system is streamlined and that a truly respected expert community has formed over the past several years. But I would like to emphasise that even outside this expert community, information has to be available on how this system works and what products it delivers.
Please, Mr Fursenko.
Andrei Fursenko: Thank you, Mr Prime Minister. Ladies and gentlemen,
The main purpose of the state policy in high-tech industries is to deal with all problems developers and manufacturers of innovative solutions at different project stages encounter, from research work to product development and marketing.
We carry out our strategy for supporting research labs and innovative businesses through specific foundations. I should clarify up front that these foundations are not the same as state research academies and they perform slightly different functions than the government agencies that carry out federal targeted programmes. These foundations are charged with laying the groundwork for innovative projects.
While most of our allocations generally go towards existing R&D infrastructure, the money allotted under federal targeted programmes is invested in new innovative projects in priority areas which have already been approved. Such projects are reviewed and selected by R&D foundations.
For example, the Basic Research Foundation and the Foundation for Humanities Research hold open contests to select projects. This is the best selection mechanism in the basic research sector. There is the Foundation for Russian Science, which is responsible for concluding state contracts. Its activity is regulated by Federal Law No. 94.
Each of these foundations promotes and supports promising initiatives in the industry, no matter where scientists who had developed them work: at government-funded institutes, private companies, the Academy of Sciences or universities.
These foundations award grants to scientists and supervise their projects. Grants are awarded without conditions.
Mr Prime Minister has already outlined our main objectives in this industry. I am not going to go over them again. I’d only like to say that one of our absolute priorities is to thoroughly review applications and supervise projects.
The foundations have brought together many renowned experts. I’d like to give one example. While carrying out the tasks set forth in government resolutions 218 and 220, we hired a group of experts to evaluate several projects. Most of the experts were members of these foundations.
On a side note, Resolution 220 called for a contest to be held among leading international scientists to create research labs at Russian universities. We hired experts recommended by the U.S. National Science Foundation, associations of European and American universities and the European Commission. I should say that the quality of the evaluation made by Russian experts was at least as good as that of the renowned experts from leading international institutes.
Today we will hear reports of the heads of these foundations. They already spoke at the exhibition today and now will tell us about their accomplishments in greater detail. Now I would like to highlight several remarkable projects.
In March 2010, physicists at a research institute based in the town of Dubna synthesised the super heavy element number 117, which the American Physical Society honoured as one of the most prominent discoveries in basic research made in 2010. This project was made possible by a grant awarded by the Basic Research Foundation, after which it was joined by several international foundations and the work was completed successfully.
Meanwhile, this foundation financed an applied research project of the Tomsk Regional Centre for Manufacturing Technology, which developed parts of cooling systems for nuclear reactors made of zirconium and titanium alloys. These solutions were later used by Chepetsky Mechanical Plant to develop serial technology. As you can see, these foundations help to resolve a wide range of research challenges.
The same goes for the Development Foundation for Small Businesses in the R&D Sector. If memory serves, Mr Sergei Polyakov [Director General of the Foundation for Small Businesses] demonstrated heart valves today. The manufacturer, sponsored by this foundation, meets most of the domestic demand for such valves and also supplies them abroad – these valves have been internationally certified.
Regarding the Foundation for Humanities Research, the chairman of its board, Mr Vladimir Fridlyanov, has spoken about support for excavations today. But there is one more very important aspect of its activities – it publishes unique books. The books are published not for profit, but they make it possible to maintain the cultural atmosphere in Russia. The publications include a multi-volume encyclopedia of the Russian language, research on the restoration and publication of unique documents, and so on.
Now I’d like to say a few words about the financing for these foundations. They were set up in the 1990s, and the disbursements budgeted for them were comparable to what civilian research received. This approach has its logic.
Since the foundations finance the larger share of major innovative projects, in particular at the first stage (most of them are also sponsored by RusNano and Russian Venture Company, as well as through the Skolkovo project), the state had to set a fixed ratio of allocations for the foundations to those for civilian research in order to eliminate the problem of bottlenecks.
This ratio was maintained until the crisis broke out, when allotments for civilian research were not only kept at the same level but even increased through an anti-recessionary programme, while disbursements for the foundations remained at the same level.
Some even suggested reducing spending on them. But the government has made a decision to keep it at the same level. This decision was supported by the Ministry of Finance.
We set aside the same amount for 2011. Unfortunately, the funding for 2012 and 2013 had to be cut, although we insisted that it should be maintained or, better yet, increased.
We have an understanding on this issue with the Ministry of Finance; we agreed to revisit it as we revamp the budget for the next three years in 2011. However, I think it necessary to mention this problem now.
It is critical to increase allocations for these foundations. The increase should at least keep pace with inflation, and outpace it if possible.
Why is it so important to increase these allocations? It would be very unsound to narrow the research field now, as sometimes research projects can result in new important unexpected discoveries.
On the other hand, if we keep the research range unchanged, we have to reduce the value of grants. Today the average value of grants awarded by the Basic Research Foundation, the Foundation for Humanities Research and the Foundation for Small Businesses is worth 400,000 roubles, 350,000 roubles and around 1,000,000 roubles, respectively, which is often inadequate for important forward-looking projects.
These sums may seem adequate for theoretical research projects but are definitely not enough for projects involving tests of new solutions. This is why I believe it is absolutely necessary to increase allotments for these foundations, while understanding that any increase should be economically substantiated.
Another important issue is legal regulation of the foundations’ activities. We have drafted a federal law to specify the legal status of these foundations. The Duma has passed this law in the first reading.
According to the new legislation, one of the key aspects of their activities should be support for innovative projects, along with general research and development projects, which is of crucial importance to innovative businesses.
The new legislation also calls for providing benefits to private foundations alongside state-run ones, which already receive these benefits.
The law also sets forth tax incentives, exempting the grants awarded by the foundations and the contributions to the foundations’ capitals from corporate tax.
We also suggested that the draft law include the legal definition of innovative activity and a provision that state-run foundations can have the status of autonomous bodies. We discussed this issue with the foundations’ heads as well as with ministries and agencies.
We are ready to make these amendments, and we believe the Duma can review them during the second reading.
This concludes my report. I think the heads of the foundations can tell us more about specific problems they face today. Thank you.
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Vladimir Putin’s closing remarks:
We have gathered here for a specific purpose. As I said in the beginning, we needed to take a close look at the funding and achievements of foundations that support science and high-tech research. These foundations were established rather long ago – over ten years ago, in fact – and they have been doing good work since then. They involve thousands of people, and they have backed several hundred thousand projects – several hundred thousand! The effect is evident. It’s no coincidence that a foundation to support small and medium-sized businesses working in the field of innovation and high technology eventually branched off from the Basic Research Support Foundation. It happened naturally.
The Foundation for Humanities Research is also doing good work. We have seen the results of its work today. Next year, we are allocating six billion roubles to the Basic Research Support Foundation, a billion roubles to the Foundation for Humanities Research, and four billion to the Small and Medium-Sized Business Support Foundation – 11 billion roubles, all told. We will review your work in the first quarter to see what else should be done.
I would like to call your attention to the need to improve the regulatory environment, especially considering the several critically important draft laws that are awaiting approval, including a law on innovative activities. I am not sure that we will write the law on expert review quickly enough, though we should start thinking about it now. At any rate, we can and must make a few necessary steps to streamline the system of expert review and enhance its transparency, though the available body of experts is authoritative enough as it is. We must involve influential scientists and experts irrespective of nationality and borders. Borders should not be an issue in this field of activity, and indeed they aren’t.
Last but not least, ongoing work will be closely linked with other development agencies and the real economy. This activity, which is so intertwined with real life, must be supported in every way possible. It will yield practical results, which will help to enhance labour efficiency, and will express itself in greater efficiency and a greater role for innovation in our economy as a whole. However, as you know, the situation in this field is problematic, to put it mildly, despite all our appeals to expand the next-generation innovative economy. But these appeals are not mere words. We are seeing a gradual expansion at a rather modest pace for now. It is our duty to speed up the process. We have everything we need to do so. I am counting on our effective teamwork in the near future. Thank you.