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topic Ministry

28.03.2011

Investing in the future: The Twelve Billion Euro Package of the Federal Government

In the coalition agreement for the 17th legislative period, the governing parties agreed to invest €12 billion more than previously planned in the key areas of education and research between 2010 and 2013 - €6 billion in each of the two areas.

This promise is being kept despite the necessary budget consolidations: the additional €12 billion euros have been included in the budget of the Federal Ministries and in the Federal Government's financial planning. The BMBF plays a central role in these activities and is to receive more than half of the funding for education (59 per cent) and about two thirds of the funding for research (66 per cent). The remainder will be made available to other Ministries that have responsibilities in the areas of education and research in addition to their core fields of work.

Contributing to the 3 per cent and the 10 per cent targets

With this funding, the Federal Government is making a significant contribution to achieving the 3 per cent and the 10 per cent targets:

The 3 per cent target for research and development was originally formulated in the European Union's Lisbon Strategy. It was jointly agreed by the EU Member States at the beginning of the new millennium and confirmed last year as an objective of the Europe 2020 Strategy. It is the Federal Government's declared objective to invest three per cent of GDP in research and development by 2020 in cooperation with the Länder and the private sector.

In addition, the Federal Government and the Länder agreed on the 10 per cent target for education and research at the Education Summit in Dresden in autumn 2008. This target includes funding for education as well as spending on research and development.

Why is the Federal Government investing so much money in education and research?

We are facing tremendous global challenges: climate change, securing the global energy and resource demand, demographic change, the shortage of skills, common diseases, and many others. If we want to find solutions and strategies for sustainable growth, we need to know more about ourselves and the world in which we live. And if we want our products and services to continue to be bought here and across the world, precisely because they are "Made in Germany", we need to make sure that they remain innovative and competitive. We need research and innovation to achieve both of these goals. Our children, too, need to be equipped to meet the challenges of a changing and increasingly globalized world. A solid education is the best prerequisite for this. It is also the key to an independent life and to social cohesion. That is why we need a good education system.

Research and development are worth investing in, as they are known to be drivers of economic growth: for years, the countries that have experienced the fastest economic growth have been those that have invested the most in research and development. Technological progress, which forms the backbone of our strength as an exporting nation, does not happen of its own accord or through external influences - it is a result of targeted activities in the area of research and development. It is impossible to achieve technological strength in the private sector without an outstanding science system. Government initiatives to strengthen scientific research also stimulate more private-sector investments in this field - they are the soil on which creativity, inventiveness and innovation can flourish in our country.

The level of education also has a significant impact on growth dynamics: Internationally, countries with good PISA test results tend to have the fastest growth rates. As former U.S. President John F. Kennedy once said: "There is only one thing in the long run more expensive than education: no education." We should not take Germany's current levels of economic growth for granted - we need to work on maintaining them.

Public and private investments in research and development (R&D) have increased significantly in recent years: since the mid 1990s, R&D expenditure as a percentage of Germany's GDP (known as R&D intensity) has improved dramatically compared with that of other countries. However, at 2.8 per cent (in 2009), we are still not as technologically competitive as we could be. Many countries in Northern and Central Europe (Finland, Austria) and particularly in Asia (China, Taiwan, Japan, Korea) are very dynamic when it comes to increasing their R&D investments. US President Obama has also recently said that he wants to boost his country's R&D expenditure despite the current budget problems.

What will the additional funds for education and research be used for?

The additional €12 billion euros will be used by different Federal Ministries for a wide range of activities in the areas of education and research between 2010 and 2013. Some current priorities at the BMBF include:

Early-childhood education: Early support is twice as effective

We are promoting early-childhood education in cooperation with the Federal Ministry for Family Affairs, Senior Citizens, Women and Youth (BMFSFJ). Our priority is language teaching and integration support in child-care facilities. In addition, nursery school teachers are being trained in new areas - for example in the use of new media and how to awaken children's interest in science and technology. A total of 16,000 nurseries have already taken part in the BMBF's "Tiny Tots Science Corner" project. Extensive research projects on early-childhood support are currently under way, and we expect them to produce insights on how we can compensate for deficits and develop talents more effectively.

Skilled staff: Training the next generation

There is already a skills shortage in the private sector. Numerous studies predict that demographic developments will exacerbate this situation over the next two decades. In particular, there will be a shortage of highly-skilled workers and university graduates. To address this challenge, we plan to invest in both vocational training and academic education with a view to pursuing the following measures:

Vocational training: There is already a shortage of applicants in some occupations. With the "Education Chains Leading to Vocational Qualifications" initiative, we are reducing the number of school drop-outs and making the transition to vocational training more efficient. At-risk students from secondary general schools and special needs schools are assigned voluntary mentors to help them make the transition to vocational training and work. The initiative to provide careers advice in inter-company training centres and similar institutions will also be continued on a long-term basis. In addition, the successful Meister-BAföG (financial assistance for master craftsmen trainees) will receive more funding than ever before.

Higher education: The BMBF is providing more than €2.5 billion for institutions of higher education in 2011 alone. The Länder are receiving part of this money under the Higher Education Pact so that they can create additional places for the numerous young people who are expected to apply to university during the years in which two year groups will finish school at the same time. The end of compulsory military service will increase the number of university applicants even further. We believe that everyone who wants to go to university should be given a chance to do so.

To ensure that more students complete their degrees successfully, we have added a third pillar to the Higher Education Pact: the Teaching Pact is designed to improve the conditions of study and the teaching quality at universities, for example by enabling universities to take on extra staff and improve the training of professors and tutors. The Federal Government will invest about €2 billion in this measure until 2020.

Financial considerations should not stop anyone from pursuing a degree. To this end, the Federal Government has increased the funding provided under the Federal Training Assistance Act (BAföG) twice since 2008 and has adjusted the allowable deductions to ensure that more school and university students can benefit from the funding. In addition, we have introduced the Germany Scholarship, which is financed in equal parts by the Federal Government and by private funding providers. In this way, we are laying the foundations for a strong new scholarship culture.

The measures taken over the last few years have already borne fruit: in 2010, more students were accepted at German universities than ever before. The percentage of people entering higher education increased by three per cent to more than 46 per cent.

Research: Preparing Germany for the future

The High-Tech Strategy is a central instrument for the strategic coordination of the national innovation policy. It is being further developed and implemented on the basis of a Federal Government decision of July 2010. The entire Federal Government is determined to put research and innovation at the centre of the political agenda.

The aim of the High-Tech Strategy is to create lead markets and establish lead suppliers, to intensify cooperation between research and industry, and to further improve the general conditions for innovation.

We want to make Germany the leading provider of science- and technology-based solutions in the areas of climate/energy, health/nutrition, mobility, security, and communication. By focusing on these areas, the High-Tech Strategy is also creating growth and employment in Germany.
Forward-looking projects focus on selected tasks as a basis for future research and innovation policy. These projects pursue specific objectives related to scientific and technological development over a period of ten to fifteen years. Strategies for innovation are being developed and steps towards their realization planned in concrete cases. The selected forward-looking projects include "Living an independent life well into old age" and "CO₂-neutral, energy-efficient and climate-adapted cities", for which a detailed vision for the future has already been developed and presented to the general public under the title "Tomorrow Town".
National and European research and innovation policies are being closely linked. Europe 2020 is an ambitious process started by the European Commission and the European Council with the aim of putting education, research and innovation at the centre of European growth policy. On this basis, Germany will contribute to a coherent research and innovation policy in Europe.

The Industry-Science Research Alliance is an expert body that supports the implementation of the High-Tech Strategy. All of the Federal Ministries are represented in the Research Alliance, where they work together with representatives from science and industry. In this way, the Research Alliance is making a direct contribution to pursuing the strategic aims of the High-Tech Strategy, providing concrete support for innovation-oriented research and giving shape to the general conditions for research.

The BMBF's website offers information about the various fields of research receiving support from the BMBF.

We are strengthening the German science system through the Pact for Research and Innovation. After all, our leading position in science depends on the quality of our research and innovation system. The German research organizations (the Fraunhofer Society, the Helmholtz Association, the Max Planck Society, the Leibniz Association and the German Research Association) will receive 5 per cent more funding every year from the Federal Government and the Länder in coming years.

The Excellence Initiative will also be continued. It supports cutting-edge research at universities, undertaken in cooperation with research organizations and the private sector. This is strengthening research at universities and making it more visible. The first round already generated a wave of innovation at German universities, triggered structural changes, and significantly increased the attractiveness of German universities for researchers and students from Germany and abroad.