Insights

Emerging priorities for research funding in 2021

By October 29, 2020 No Comments
research funding priorities in 2021

2020 has been a year of surprises, leaving everyone with more questions than answers. For researchers, knowing the upcoming areas where research funders intend to focus is critical to securing funding for 2021 and beyond. Without a doubt, the fastest-developing research priority in FY2020 was COVID-19. The pandemic has taken hold with breathtaking speed, bringing with it an unparalleled urgency to develop vaccines, treatments and preventatives. In addition, the pandemic has sparked new interest in research dedicated to finding and defusing the next virus with pandemic potential before it takes hold.

But what are the priorities for research funders in FY2021? Has the focus on COVID-19 changed research funding priorities? If so, which research areas can expect to benefit from funder attention? And further, what will the impact be on research that falls outside of newly established priorities?

Background on research funding

The federal budget cycle begins each year on October 1. It ends the following September 30. As of this writing, the federal budget cycle has already begun, with the help of a continuing resolution signed by President Donald Trump on September 29, 2020. This continuing resolution provides ongoing funding only for critical government operations. As such, it will remain in place until December 11, 2020. Until the Senate takes up the appropriations bills passed by the House of Representatives in July, there will be no clear consensus on federal research funding priorities for 2021.

As we know, private funders independently choose how they distribute or prioritize funding. Because of this, they will remain focused on their individual areas of interest. Likewise, some universities have begun to self-fund certain research initiatives.

In the foreseeable future, public funding for basic and applied research seems poised to decline in both the US and Europe. Earlier this summer, the European Union agreed on a 7-year budget that includes significant cuts to funding for basic scientific research. China intends to counter this trend, however; it recently announced that it will again increase the percent of the budget allocated to research funding by double digits.

Trends in public research funding levels

In all, the Trump administration has proposed a $13.1B cut in research funding for FY2021. Mirroring this trend, in July, the members of the European Union agreed to cut public funding for scientific research by nearly €13.5B by 2027. The European Research Council (ERC), which funds public research in the EU, is bracing for budget cuts beginning next year. China plans to accelerate public funding for basic research. Ultimately, it plans to spend 2.5% of its GDP on publicly funded scientific research.

White House priorities for federal research funding

The White House proposed overall funding reductions for all major federal agencies that conduct basic and applied research. Within each agency, however, the White House proposed a few funding increases. The most notable requests prioritize:

Congressional priorities for research funding

As part of the budget process, the House of Representatives passed its version of funding appropriations for FY2021. While there are substantial differences between the funding priorities of the White House and the House of Representatives, we can see early indications of how Congress may ultimately allocate federal research dollars.

Constitutionally, the US Congress sets and approves funding for each federal department, so the White House’s budget requests may not transfer well into the final appropriations packages. As of August, the House of Representatives proposed overall increases in funding for basic and applied research, and R&D. In many cases, the proposed House appropriations minimize or eliminate funding cuts proposed by the White House.

The House appropriations increased funding for:

The Senate is expected to consider the appropriations bills after the 2020 General Election and before the end of the current legislative session. Further, the result of the General Election could potentially moderate appropriations mid-year. If elected, Senator Joe Biden promises to increase funding for scientific research; decrease funding for fossil fuels; restore funding for environmental protection and climate change initiatives; and focus intensive research efforts aimed at ending the COVID-19 pandemic. On the other hand, if the Trump Administration returns to Washington, D.C., it promises to double federal funding of artificial intelligence (AI) and quantum information science R&D by FY 2022.

COVID-19 will capture research dollars until at least 2024

The big elephant in FY2021’s living room is still COVID-19. The pandemic erupted after federal research budgets were set for FY2020. Following its arrival, the government allocated funding for disease research in a series of emergency appropriations. This funding covered every federal response, including scientific research. The Centers for Disease Control and Prevention (CDC), the National Institutes of Health (NIH) and the Biomedical Advanced Research and Development Authority (BARDA) will be largely responsible for managing ongoing federal funding for COVID-19 research.

The government’s response was consistent to the traditional federal approach to public health emergencies that arise in the middle of a budget cycle. For example, Congress also used supplemental funding to provide additional resources to the NIH in 2009 as part of the American Recovery and Reinvestment Act. That $10B emergency appropriation increased the NIH budget that year by more than one-third. Congress also approved supplemental appropriations to fund research into Ebola and Zika in the years in which those diseases emerged as a threat to public health.

The supplemental coronavirus funding to the NIH amounts to more than $3.6B. While this marked a nearly 9% increase over the established FY2020 budget for the NIH, the amount is significantly less than the $10B allocated to previous epidemics. Emergency funding remains available to these agencies until September 30, 2024. Congress also permitted the transfer of supplemental funds between federal agencies to ensure the appropriate distribution of research dollars.

Private research funders favor applied research

Unlike the federal government, private research funders tend to focus on a limited area of specialization or interest. Private funders include corporations, non-profit foundations, venture capital firms, and in some cases, individual donors or sponsors. A growing number of research institutions are “self-funding” a limited amount of both basic and applied research, using their own resources.

While the federal government funds a significant portion of basic scientific research in the US, private funders underwrite nearly 75% of research and development (R&D). Higher education institutions fund nearly 15% of applied research. By comparison, the federal government funds just 10%. Within this 10% are the Departments of Defense, Health and Human Services, Energy, the National Science Foundation (NSF), Agriculture, Commerce and Transportation.

Typically, private funders do not coordinate their spending with other private funders, but the growth of private research funding is expected to continue. As public research funding declines, private funders will step in to provide financial support for both basic and applied research that advances their interests. Declines in private research funding are unlikely in FY2021. However, university-funded research may stagnate or even decline if universities see significant reductions in their budgets, donations, or the value of their endowments.

Managing shifts in funding at the institution level

Shifting federal research priorities may require your institution to seek supplemental funding from private funders. Some universities have opted to create self-funding mechanisms to ensure that institutional research priorities receive research dollars reliably.

The shift in funding from federal to private sources may require institutions to adapt their research administration methods to accommodate the demands of private funders. Depending upon the source, federal agencies may also impose new or expanded reporting requirements governing the use of private research funds for sensitive research.

How to align your institution for new research funding opportunities

Streamlyne Research delivers a comprehensive, cloud-based enterprise research administration tool that manages all aspects of the research administration process. This includes everything from pre-award to close-out and compliances. Streamlyne Research is highly secure and accessible from anywhere, so your research teams can remain productive wherever they are.

For more information about Streamlyne Research and how it can help your institution manage the changing demands of research administration, please contact us today at (619) 298-4824.