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The necessity for institutionaltransformations has become vital also for the research activity of highereducational establishments, especially after the recent changes in the activelegislation. At the present moment, from the legal point of view, the researchinstitutes attached to higher educational establishments has found themselvesin a dubious situation: though they are included in the list of researchorganizations their organizational and legal form as well as the legal statusare not defined. Therefore the research institutes and research divisions athigher educational establishments cannot be accredited as researchorganizations and thus have no right to enjoy the privileges granted to suchorganizations. Perhaps one of the natural legislative solutions could be forthe state higher educational establishments to create unitary enterprises thatare both to finance and to carry out research activity. The situation mightalso become better regulated after research universities and universitycomplexes are created. However so far many research institutes have joinedhigher educational establishments as their structural subdivisions thus havingdiscontinued their former status of separate legal entities and pursuing theiractivity on the basis of a mandate issued by the rector. But this situation isvery often inconvenient for both the research institute and the highereducational establishment itself. This collision sets obstacles in theway of research activity at higher educational establishments. At the same timeresearch activity is becoming increasingly important in the system ofaccrediting higher educational establishments. In the year 2001 the criteria inthe system of state accreditation of higher educational establishments shiftedtoward strengthening the role of research activity. The threshold indices forbudgetary and extrabudgetary funding to be provided for research anddevelopment per unit (per capita) of the faculty staff and consequentlyfor the establishment in question to be>

Funding the research activity at highereducational establishments was not among the state’s priorities. While the plan offunding provided for the RAS has been overfulfilled, that of funding theresearch at higher educational establishments through the Ministry ofEducation, on the contrary, has not been fulfilled as planned. The distributionof budgetary funds by Ministries as envisaged for the year 2002, again, is notfavoring the Ministry of Education and the Ministry of Industry, Science andTechnologies. And the research activity of Moscow State University whosefunding is entered in the budget as a separate item is planned at 76% of thelevel of the year 2001. On the whole, the year 2001 saw a continuing reductionin the share of the funding on research in the budget expenditures. Itwas 1.84%, while the budget for the year 2002 is envisaging only1.5%.

The cuts in budgetary funding haveinfluenced the changes in the structure of the sources of financing in thesphere of science. The share of budgetary funding has been decreasing havingreached, according to preliminary estimates, the figure of 48.7%, while theshare of the enterprising sector has not changes, and the share of foreignsources has been increasing. Today, according to the results of sociologicalsurveys, the share of foreign funding in the budgets of successfully working isat least 25%. In this respect Russia is a unique country if compared tothe developed countries in the West and the former socialist states of EastEurope. The growth rate of the foreign funding for Russian science during thepast 5 years has been unprecedented, and now Russia has the highest share offoreign participation in the total amount of funding in the sphere of science.Russia, with her 17% of foreign funding in the total spending on science, hasleft behind the UK –the absolute leader, as far as the share of foreign funding is concerned, amongthe developed Western countries with her 16.8%, and all the East Europeancountries (Hungary, Czechia, Poland) where this share varies between 1.5% and5%23. As for the actual volume of the foreign funding provided forRussian science, it is even higher because due to the peculiarities ofstatistical reporting this index is underestimated approximately by20-30%.

The share of industry in financing Russianscience today is, according to preliminary estimates, 16.4%, while in thedeveloped countries of the world it varies between 50% (Great Britain, France)and 73% (Japan). At the same time, in 2001 domestic charitable funding emergedwhich was distributed on the principle of competition-based allocation ofgrants through specially created foundations. These funds so far have not beenlarge but the tendency itself of such sources to be appearing at all seemsimportant.

The state research funds – the RFFS and the RHRF– represent the mostefficient (as of today) mechanism of distributing budgetary financing. Besides,now there exist certain areas where their activity has becomeindispensable because they are carrying out the functions that used to beperformed by other agencies. This has to do primarily with the promotion ofpublishing, support of electronic libraries and the development oftelecommunications. In 2001 the RFFS allocated $ 4 mn for the creation andmaintenance of an electronic library that has provided for scientists afree-of-charge access to full versions of the best foreign and Russian journalsand databases on all areas of fundamental science. For RHRF, the support ofpublishing projects comes second after providing the financing for grantscovering individual and collective research. Owing to the activity of boththese funds, the scope of certain publications has almost reached the formerУSoviet levelФ. These programs are developing in the situation of dramaticallyreduced allocations on the part of the RAS for subscriptions to besubmitted by libraries. However in the year 2002 the situation might becomemore complicated because in accordance with the new Tax and Customs Codes anypurchases of literature on science – both Russian and foreign– are subject to a20% VAT which in fact would mean a reduction in the volumes of literature to bepurchased.

On the whole, because of the scarcity ofthe funds allocated to these two organizations (both the RFFS and the RHRF arestill receiving a total of only 7% of the budgetary financing on civil scienceon the item УFundamental research and assistance to the progress of science andtechnologyФ) they are unable to support many important directions of researchor finance the renovation of the material base of science. Besides, afterthe approval of their new statutes, the former scheme of distributing financinghas become problematic. Now the funds are federal institutions under thegovernment, and they provide competition-based financing of research projectsand other activities conducted by research organizations. This in fact means anexpansion of the administrative rights of their directors to select the staffneeded for carrying out projects and to manage the financial assets allocatedby the funds. The notion Уresearch collectiveФ has in fact been replaced bythat of УorganizationФ.

In the year 2001 the maximum size of a RFFSgrant for a group of researchers under 10 persons was 150,000 roubles, themedium-sized grant –80,000 roubles. In the RHRF the maximum size of an individual grant was 50,000roubles, that of a collective grant – 150,000 roubles. And only slightincrease has been planned for the year 2002: the size of the RHRF grants is tobe 60,000 and 170,000 roubles, respectively.

As for foreign programs and funds, thesupport provided by the ICST (International Center for Science and Technology)alone for the civil projects of the former MIC scientists in the year 2001 was335 million dollars which is six times as much as the budgets of both the RFFSand the RHRF put together.

The financing priorities of the foreignorganizations are undergoing a change, and the most obvious shift today istoward supporting joint research. According to experts’ estimates, nowadays one third ofall fundamental studies in Russia is done in the form of joint projects withforeign partners. Besides, those programs where support is provided to certainparticular categories of scientists (women, university researchers, researchersfrom the provinces, young researchers under 35 years of age) have been activelydeveloping.

At the end of the year 2001, a survey wasconducted among the foreign research foundations most active in the territoryof Russia as an attempt to specify what is the main contribution of thesefoundations to the support of Russian science. It was found that 53% of therespondents believed that their support was most for young researchers who thuswere able to stay in the sphere of science. Then, as 47% of the respondentsthought, they had helped mainly in the commercialization of Russian productsand technologies. Finally, 13% said that they had contributed to the formationof research infrastructure by promoting telecommunications, providing an accessto foreign periodicals, replenishing libraries and financing purchases of newequipment needed for research. At the same time there was a question as to howthe researchers in the West and Western science in general had benefited fromthe foundations’activity. Here, the answers are obvious. Three main lines of benefiting for theWest are as follows: they had acquired an access to unique and previouslyunpublished data, they obtained interesting results by participating in jointprojects, and, finally, they were granted an access to specific geographicalareas (this concerns primarily zoologists, botanists, specialists on thesciences on the Earth).

Among the issues that have been recentlydiscussed by the funds is the possibility and feasibility of implementing theprogram of УrepatriationФ of Russian scientists who emigrated from the countryby offering them special grants for resettling and working in Russia. Suchexperience has already been accumulated by some developed countries, forexample Great Britain and Canada where the sphere of science has begun to feelthe negative effect of an outflow of most talented researchers to the USA.However in those countries the necessary financing is allocated not by fundsbut by the governments who are well aware of the importance of a УcriticalmassФ of bright scientists for the economic and general cultural development ofany country. At the same time there is no single answer to the question as tothe efficacy of such initiatives. True, the progress of science depends notonly on the presence of УstarsФ or high salaries of scientists but also by ahost of other factors, among them - the availability of well-developedinfrastructure of research and innovation activity, incentives for industry tosupport science, a positive attitude toward science on the part ofsociety.

In the sphere of tax regulation on thewhole there have been a number of positive developments. Thus, there aregrounds to believe that the lowering from January 1, 2002 onward of the profitstax and the inclusion of the cost of research and development in the totalproduct cost will have a positive effect on the development of innovationactivity in the sphere of small-scale high-technology business, as well as willstimulate industry to make larger investments into fundamental and appliedresearch.

Besides, in February 2001 the Decree of theGovernment of the RF (No 91 of February 2, 2001) УOn the Utilization byResearch Organizations of a Part of their Profit Left at their Disposal onCarrying On and developing their Research and Development WorkФ was approved.This Decree contains a list of the themes for research that are subject to thisprivilege. Unfortunately they are formulated in such a broad manner that almostany work can be >

The lack of government financing in thesphere of science was compensated for in the year 2001 mostly by foreignsources and to a certain degree - by the financing provided by industry and thebudding private sponsors. As a result, the average salary level in the sphereof science went up and became, according to preliminary estimates, 116.2% ofthe average wage level in the economy. Thus, in 12 out of 30 main branches ofthe economy the wage level was lower than in science. This financialstabilization, in its turn, influenced the employment in the sphere ofscience.

From the point of view of quantity, thesituation with employment is no more so acute as it used to be two yearsago. Moreover, there has been a further growth in the number of thoseemployed in the sphere of science and technology. According to preliminarycalculations, the number of those employed in the sphere of science andtechnology in the year 2001 grew to 916,200, having increased by 0.6% ascompared to the level of the year 2000 and by 5% as compared to the level ofthe year 1999. The increment in the number of the employed was created mostlyby an inflow of the young, including those who had completed their postgraduatestudies. The share of postgraduate students who complete their studies with adefended thesis has reached a record of 30% which is the highest figure for thepast decade. As for the absolute number of postgraduates who have completedtheir studies and of new dissertants, it was also by 12.9% and 26% higher than the precedingyear’s level. TodayRussia is the leader by the number of dissertations defended in every 10,000researchers: for Russia this figure is about 450, for the USA - a little over200.

Despite the growing interest towardacquiring science degrees, the share of researchers has been graduallydecreasing. Today this category amounts to about 48% of the total number ofthose employed in science, while in the year 1992 this index was 70.5%. Thisdecrease is in part justified because more marketing and legal services haveemerged as well as divisions dealing with commercialization of the results ofresearch and development.

As far as employment is concerned, theproblems in today’sscience relate not so much to an outflow of researchers as to a disruptedreproduction structure and dramatic aging of the research staff. In November atthe general assembly of the RAS it was officially admitted that Russian sciencehas become Уthe most elderlyФ in the world. True, at the present time the shareof researchers under 40 years of age is 12% - a figure the smallestever.

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