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Eleventh-hour deal pulls science funding back from the cliff

The deal to avoid the “fiscal cliff,” agreed by the House and Senate on 1 January after negotiations with the White House, provides science funding with a temporary reprieve.

Fiscal cliff is a term used to describe the combination of automatic tax increases and drastic spending cuts, known as the sequestration, which was triggered by the 2011 Budget Control Act.

“Science funding was most threatened by sequestration,” said an American Society for Biochemistry and Molecular Biology (ASBMB) blog post on 2 January. The group said the across-the-board cuts would have knocked more than 8 per cent off the budgets of all federal research funding agencies, including the National Institutes of Health and the National Science Foundation, and would have had “deleterious effects on how science is conducted in this country”.

The deal, which was preliminarily approved by the Senate in the early hours of new year’s day, postponed the sequestration until 1 March. But ASBMB said science agencies’ budgets will be much discussed in the coming months as the new Congress will be embroiled in a debate over raising the national debt ceiling.

In the months before 1 January, when the sequestration cuts were due to begin, science and research groups had warned that agencies such as NIH cannot reduce spending on the salaries of their federal employees quickly enough to meet the sequestration demands.

For example, ASBMB estimated that trimming the NIH budget by $2.5 billion would probably require the agency’s funding to be cut by more than 11 per cent, or $3.4bn.

It also suggested that the NSF was unlikely to have cut specific programmes to comply with the sequestration, but would instead probably have reduced grant awards and tried to spread the pain of cuts out over time.

Immediately after the fiscal cliff deal was reached, President Obama said that “Cutting spending has to go hand-in-hand with further reforms to our tax code so that the wealthiest corporations and individuals can’t take advantage of loopholes and deductions that aren’t available to most Americans. And we can’t keep cutting things like basic research and new technology and still expect to succeed in a 21st century economy.

“We’re going to have to continue to move forward in deficit reduction, but we have to do it in a balanced way, making sure that we are growing even as we get a handle on our spending,” he added.

The resident noted that the 1 January agreement means more than 98 per cent of Americans and 97 per cent of small businesses will not see their income taxes go up, and companies will continue to receive tax credits for their research and investments and for the clean energy jobs that they create.

Obama pointed out that the agreement extends tax relief for businesses through to the end of next year, including the research and experimentation tax credit.