OECD expert workshop on the measurement of public procurement of innovation. "Measures of publc procurement of R&D", presentation by Fernando Galindo-Rueda

1. MEASURES OF PUBLIC
PROCUREMENT OF R&D
OECD WORKSHOP ON MEASURING PUBLIC
PROCUREMENT OF R&D AND INNOVATION
Fernando Galindo-Rueda and Silvia Appelt (OECD)
Presentation of interim findings
Version not for quoting / wider circulation

2. • Comparison of supplier- and funder-based
perspectives.
– Main features
– Examples: United States and Canada
• Results from OECD/NESTI experimental
collection of funder-based data from
budgets.
• Discussion
Contents

3. Supplier Buyer
Sources: Surveys of firms and other
suppliers
Budgetary information
Surveys of procurement
officials
Administrative records
Advantages: Direct capture of the R&D
or innovative activity
Internationally comparable
if implemented in business
surveys
Directly capture purpose / use
Theoretically comprehensive,
subject to admin process
Disadvantages: Limited awareness of use
Risk of omitted funds
Constrained to domestic
suppliers
Difficulty of aligning national
practices – diff. admin
process.
Ltd awareness of underlying
R&D activity.
Perspectives for data collection

4. • Canada
– Previously discussed sources. All from Statistics
Canada.
• Business survey
• Federal survey
• United States
– Different sources.
• NSF/NCSES:
– Business
– Federal funds for R&D (no procurement breakdown)
• Procurement admin data. Not necessarily
comparable/consistent.
Examples

5. Source: OECD calculations on data from Statistics Canada, 2012
Canada. Federal government as a source
of R&D funds for Canadian firms.
0
0.2
0.4
0.6
0.8
1
1.2
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010 (p)
Contracts
Grants
Contract to grant ratio
R&D tax incentives become more
important over this period
Share of funds for R&D

6. Source: Statistics Canada (2012).
Contrasting budget and performer R&D
data: The case of Canada (CAN$million)
Federal R&D expenditures BERD GOV Sources
Contracts Grants
Both sources indicate that
procurement accounts for
~25% of federally-funded
R&D performed domestically
by Canadian business
Fed funds source indicates funds twice as large as the business data
Federal
funds for
R&D
received by
domestic
R&D
performers
Business R&D survey, intramural R&D
funded by Federal govt.

7. 40 % of US federal funds go to business.
United States, 2010
Federal funds for R&D data - NSF

8. United States: Federal Funds for R&D
and fed-funded R&D (USDmillion), 2010
Various factors for gap between what companies
report and what budget data say:
- R&D performed abroad by US and non US firms
- Passed-through funds
-Admin/survey errors
- Timing of funds – appropriation/expenditure
Source: NSF/NCSES

9. United States: Overall R&D federal
funds and R&D procurement funds
(Secretariat estimates from FPDS)
Completely separate source of
data, entirely focused on
procurement.
R&D defs may not fully match.
R&D procurement ca 40% of total
funds
R&D Procurement is more
business oriented than total
funds.
Nearly 85% of business funds are
procurement related

10. United States: Overall R&D federal funds
and procurement funds (Secretariat estimates from FPDS)
Comparison indicates
implied level of grants and
other non-contract funds
received by each broad
sector.
Most of non-business funds
are through means other
than contracts
(contracts only ~15%)

11. United States: Adjusting for the level
difference, budget/admin data and business
data provide a similar picture
In both cases, about 85% of funds going to business
do so as procurement/contracts
Budget-related sources Business sources

12. United States (full overview)

13. • 2nd experimental / voluntary data collection
by OECD –NESTI Working Party
– Modes of Public Funding of R&D based on
GBAORD
• Inclusion of a new breakdown
– based on type of instrument (contract, grant,
funds for govt intramural R&D…)
• Launched Nov 2012-still live.
– Few countries currently able to provide
information on this particular indicator.
Complemented with other sources.
Funder perspective. Estimates of R&D
budgets as starting point.

14. Notes: Percentages refer to % of government budget appropriations or outlays on R&D (GBAORD)
Source: OECD/NESTI experimental survey on modes of public R&D funding based on GBAORD data. Nov2012-
Jan2013
(*) Data for CAN based on statistics on Federal Funds for R&D (Statistics Canada)
(**) Data for USA refer to OECD estimate based on own estimates of Federal procurement of R&D based on FPDS
and NSF estimates of total Federal funds for R&D. Using different sources may overstate R&D contract share.
Results: allocation of government funds for
R&D, by type of instrument, 2010
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
BEL CHE IRL ISR NZL CAN* USA**
R&D contracts Funds for intramural government R&D Other, including grants
Only 5 countries
so far able to
provide this
breakdown

15. Notes: Percentages refer to % of government budget appropriations or outlays on R&D (GBAORD)
Source: Unless otherwise stated, from OECD/NESTI survey on modes of public R&D funding. Based on GBAORD
data. Nov2012-Jan2013
(*) CAN : OECD calculations based on statistics on Federal Funds for R&D (Statistics Canada)
(**) USA: OECD calculations based on own estimates of Federal procurement of R&D (drawing on FPDS) and NSF
estimates of total Federal funds for R&D. Using different sources may overstate R&D contract share.
Results: allocation of government funds for
R&D, by type of instrument, 2010
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
BEL CHE IRL ISR NZL CAN* USA**
R&D contracts Funds for intramural government R&D Other, including grants

16. • Business R&D surveys
– Most do not include question
– CAN, USA, ESP show it would be easy to include.
– Would meet National Accounts needs for capitalising
R&D.
– Would be more internationally comparable.
• Consider HE sector as contract R&D provider to
Govt.
• Budget-based data already available in some
countries, but still a minority.
– Only source for procurement abroad.
– Challenge for international comparisons.
Summary points

17. • Treatment of complex cases.
– Mixed ownership of rights from R&D.
• Assume contract funds=investment by authority,
costs not covered = own investment by firm?
– Grants and other incentives to participate in
procurement actions.
• Business reported data.
– Include in guidelines for revised Frascati Manual
/ OECD international collection
• Role of budget-based data.
– Integrate in surveys of government authorities?
Points for discussion