Question
Mr Laurence Lien: To ask the Minister for Trade and Industry (a) what is the target ratio for Public Expenditure on Research and Development (PUBERD) to Business Expenditure on Research and Development (BERD); (b) whether the higher PUBERD to BERD ratio in the last three years compared to the previous three years is a cause for concern; and (c) how else is the Government measuring and tracking the outcomes of PUBERD.
Written reply by Mr S Iswaran, Second Minister for Trade and Industry
Under the Research, Innovation and Enterprise 2015 (RIE2015) masterplan, the Government has committed to invest $16.1 billion between 2011 and 2015 to support research and development (R&D) in Singapore. This public expenditure on R&D (PUBERD), representing 1 per cent of Singapore’s GDP, is aimed at raising the overall gross expenditure on R&D (GERD) by catalysing private sector R&D.
Our base of research and development capabilities has made Singapore an attractive location for MNCs to locate their R&D facilities. Over the last three years, companies such as Applied Materials, Chugai Pharmaceuticals and Proctor & Gamble (P&G) have set up major R&D facilities in Singapore, and are collaborating with public sector research performers such as the A*STAR research institutes and our universities.
The tapering of the business expenditure on R&D (BERD) to PUBERD ratio in the last three years compared to the previous three years is not necessarily a cause for concern. It is common for a country’s BERD to experience short-term fluctuations, because BERD is dependent on macro-economic conditions as well as individual companies’ investment decisions. The effect of the latter is particularly pronounced in Singapore due to our small but growing R&D ecosystem. Over the past decade, while the ratio of BERD to PUBERD in Singapore has fluctuated between 1.5 and 2.5, absolute BERD has more than doubled, from $2.1 billion in 2002 to $4.6 billion in 2011. Over the last three years, BERD has grown at a compound annual growth rate (CAGR) of 11.5 per cent, from $3.7 billion in 2009 to $4.6 billion in 2011.
Public R&D agencies are generally on track in the implementation of RIE2015 plans. Besides the growth in BERD, the Government tracks many other outcomes of our public R&D efforts, such as the research excellence of public sector research performers, growth in public-private research collaborations, technology commercialisation and research manpower development.