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Preliminary Report: R&D Spending Fell In FY 1996

October 1996

Federal funding for research and development (R&D) dropped 3% in FY 1996, according to a preliminary report by NSF's Division of Science Resources Studies (SRS).

Using statistics from NSF's Annual Survey of Federal Funds for R&D, SRS found that the Federal government's 1996 financial obligation to R&D and R&D plant (facilities and equipment) dropped from $73 billion in FY 1995 to $71 billion. In addition, the 1996 survey of 32 Federal agencies captured more detail than earlier surveys, dividing the development funding of the Department of Defense (DOD) into two categories: major systems development and advanced technologies.

"Development has never been split out into these components before," says report author and analyst Ronald L. Meeks. "DOD wanted it split apart so that there could be a more accurate comparison with other agencies. Parts of the DOD development activities are completely defense related and parts have dual usage."

Researchers found that DOD is the top spender of the 32 Federal agencies surveyed. DOD is expected to spend $34 billion on all R&D and R&D plant activities in FY 1996.

When looking at development alone, DOD is still the top spender. The agency will obligate a total of $30 billion. Most (87%) of this will go to the category of major systems development. And most of that category (95%) will be provided by the three armed services and the Ballistic Missile Defense Organization.

In the second category, advanced technology development, DOD will provide $4 billion, down $0.8 billion from FY 1995.

In addition, the report found that most Federal assistance was concentrated into a few agencies. "Seven Federal agencies, out of 32 that report to the R&D survey, are expected to account for 92 percent ($66 billion) of total Federal funding for R&D and R&D plant in FY 1996," Meeks writes.

In order of funding magnitude, these seven agencies are: Department of Defense, Health and Human Services, National Aeronautics and Space Administration, Department of Energy, National Science Foundation, Department of Agriculture,and Department of Commerce.

The NSF survey and the resulting data brief were completed based on data that agencies delivered to the White House in February 1996--the midway point for the fiscal year, says Meeks. The data do not reflect changes to the budget made more recently.

For a copy of this data brief, call SRS at (703) 292-8774 or visit NSF's Web site: http://www.nsf.gov.

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