8: R&D Investment Criteria
Better Research and Development (R&D) Investment Criteria, Department of Engergy (DOE) Other Information:
Science and technology are critically important to keeping our nation’s economy competitive and for addressing challenges
we face in health care, defense, energy production and use, and the environment. As a result, every federal research and development
(R&D) dollar must be invested as effectively as possible. THE PROBLEM • The federal government will spend approximately $90
billion in 2001 on R&D, an investment representing 14 percent of all discretionary spending. The ultimate goals of this research
need to be clear. For instance, the objective of NASA’s space science program is to "chart our destiny in the solar system,"
and the goal of the U.S. Geological Survey is to "provide science for a changing world." Vague goals lead to perpetual programs
achieving poor results. • The federal government needs to measure whether its R&D investments are effective. We can rarely
show what our R&D investments have produced, and we do not link information about performance to our decisions about funding.
Without this information, decisions about programs tend to be made on the basis of anecdotes, last year’s funding level, and
the political clout of local interest groups. • Many R&D projects have ended up stepping beyond the legitimate purposes of
government to compete with—or unnecessarily subsidize—commercial ventures. Last year, the Department of Energy (DOE) funded
a midsize turbine development project at a rate of more than $30 million a year—even though the market had advanced to the
point where all manufacturers had backlogs of orders. Unwisely invested federal dollars merely replace private research dollars,
without increasing the nation’s total commitment to research. In the worst case, misguided research funding merely inflates
the cost of doing research by bidding up the price of human and capital resources. Federal R&D should not compete with or
supplant private investments. • Finally, many R&D projects directly benefit corporations that could fund their own R&D projects
without federal assistance. For instance, DOE continues to fund gas-to-liquid conversion research even though the process
has been commercialized to the point that one multinational oil company is considering investing up to $6 billion for new
plants based upon this technology. The Expected Near-term Results • The 2003 Budget will increase the expected efficiency
of applied research and development programs in DOE by no less than 10 percent. • The 2003 Budget will reduce programs that
directly benefit individual firms, (instead of entire sectors) by no less than 50 percent. • New applied research and development
proposed in the 2003 Budget will be expected to perform in the top 25 percent of the program’s existing R&D, with the goal
of improving the quality of the research portfolio. • Application of the criteria will provide a benchmark for future performance
assessments that will inform funding beyond 2003. THE EXPECTED LONG–TERM RESULTS • The Administration expects that these investment
criteria will better focus the government’s research programs on performance. The effectiveness of the U.S. government’s R&D
investment will be measurably improved over a period ending three years from initial benchmarking. Applied research programs
will be better focused on achieving well-defined practical outcomes. Basic research programs will better target improving
the quality and relevance of their research. These investment criteria will promote our nation’s leadership in important science
and technology areas.
Objective(s):
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