The performance of the Academy of Sciences has been declining for several years. The financial and bureaucratic structures within the Academy have become increasingly obsolete negatively impacting the quality of research. The current RDI system is not capable of generating socio-economic benefits that are conducive to increasing Hungary's competitiveness. The public research funding system is under-financed and is highly fragmented between universities, different institutes of the Hungarian Academy of Sciences and sectoral institutions supervised by different ministries.
Inevitably, the cracks in the system began to show.
In 2018, the Hungarian Academy of Sciences ranked 23rd out of 28 European institutions in a review measuring the quality of output. In the realm of innovation, Hungary has also been performing poorly. On a survey measuring public innovation spending, Hungary attained a low 33.4 percent, while the share of innovative SMEs came in at only 31.5 percent. As the data reveal, Hungary is lagging far behind European nations when it comes to patent recognition and other intellectual properties.
There were other worrisome signs. In the EU’s Horizon 2020 program, for example, the Hungarian Academy of Sciences was granted only 0.6 percent of available funding, the lowest-ever to date. This, taken together with a stagnant academic climate populated by largely inert research groups and plummeting intellectual activity, poses a significant threat to future planning. This amount of funding is insufficient to boost the quality of cognitive labor.
In October 2018, the government put forward a 10-point plan for academic reforms.
To achieve better results, public spending on research, development and innovation (RDI) must be reorganized into a new framework that operates more effectively and more independently and includes suitable guarantees and personal responsibilities. To replace the disenfranchised network comprising a number of smaller research facilities, the government proposed to bring spending under one umbrella and thereby foster a culture in which grants are being allocated according to a more up-to-date set of criteria. Our plan is to boost R&D expenditures to 1.8 percent of GDP by 2020.
Meanwhile, the research procedures must undergo a set of reforms as well. The National Science Policy Council, an advisory body to the government, will be tasked with facilitating more target-oriented, profit-driven research activities and monitoring the financial expenditures of the National Research, Development and Innovation Fund. The additional 25 percent in funding, according to the Hungarian government’s plans, should help boost scientific performance.
What’s more, a new set of legislative amendments were approved July 2 that calls for a restructuring of the Hungarian RDI institutional and financing system. As part of this new infrastructure, the Loránd Eötvös Research Network (LERN) will supervise scientific activity. Operating independently of the government, LERN has been granted the same institutional status as the Hungarian Academy of Sciences. In fact, its independence is further underpinned by answering directly to the Hungarian Parliament. Its budget, too, is allocated in a separate chapter in Hungary’s central budget. The board comprises six members nominated by the MTA and another six nominated by the Information and Technology Ministry (ITM). The president of LERN’s governing body will be appointed based on the joint recommendation of the MTA president and the ITM minister. The prime minister appoints the members and the president for a term of five years.