Image: DSI
Science department wants country to spend 1.1 per cent of GDP on R&D by 2024
South Africa’s Department of Science and Innovation says it will boost the country’s gross expenditure on R&D to 1.1 per cent of GDP by 2024 as an intermediate target on its way to 1.5 per cent by 2030.
Imran Patel, the DSI deputy director-general for socio-economic innovation partnerships, revealed the target on 18 September while briefing Parliament’s portfolio committee on higher education, science and technology along with Godfrey Mashamba, DSI chief director for science and technology investment.
Patel and Mashamba appeared before the committee to explain the government’s R&D tax incentive, which gives companies a tax deduction of 150 per cent on their R&D spending, in order to prod them to innovate.
But MPs on the committee also grilled the two men on how the DSI plans to stimulate research investment in order to reach its 1.5 per cent target, from the current spending level of around 0.8 per cent of GDP.
It was in response to this prodding that Patel mentioned the interim target. “We have agreed that the way we get from 0.8 per cent to 1.5 per cent has to be broad-based. Every single player has to contribute their part,” he said.
He added: “We want to convene a meeting on departmental level to find out what it would take in Rand terms to get from 0.8 per cent to 1.5 per cent by 2030. We have set an interim target of 1.1 per cent by 2024.”
Diminishing research spending by industry has been flagged by officials as the reason for the flatlining in South Africa’s GERD as a percentage of GDP in the last few R&D surveys. Patel and Mashamba said the tax incentive is the government’s main plan for stimulating private sector investment in R&D.
Although the scheme was initially marred by backlogs, this has been smoothed out, according to Mashamba. By 2017 the scheme had stimulated R50 billion (US$3.3bn) in industry R&D investment that may not have been spent otherwise, he claimed. However, he said low demand, a constricted economy, investor uncertainty, a lack of human capital, and a drop in foreign direct investment were all inhibiting business R&D.
However, on public sector expenditure Patel asked the committee for help, urging it to “push” government to spend more money on R&D. “As a science system we have to be a lot more assertive in this administration. We have proved our value and now the money has to follow the value,” he said.
But the committee was not charmed by its two witnesses. Committee chairman Philemon Mapulane repeatedly interrupted the officials. He also squabbled with Patel about procedure, and admonished him for answering questions aimed at Mashamba.
A number of terse exchanges occurred. Mapulane said the DSI must brief the committee on its decadal plan in November, as this is expected to be approved by cabinet in October. “Part of the briefing must also reflect on R&D investment. As a portfolio committee we can then continuously discuss it and see what level of interventions are required to ensure that we are on track to reach the 1.5 per cent by 2030,” he said.
Phuti Keetse, a committee member hailing from the Economic Freedom Fighters party, criticised Patel and Mashamba for using technical language. “We hope that next time they will relax the technicalities a bit. […] We can’t all be scientists,” he said.