The role of the state in the NSI

1. The role of the state in the NSI South Africa

2. Evolution of the current form of the state The segregation/apartheid heritage • High degree of intervention: • establishment of parastatal corporations in energy, transport, iron and steel • Industrial development corporation • CSIR • Strong system of science and technology • Minerals-energy-complex (endowment driven) • Military-industrial-complex (strategic imperatives)

3. Evolution of the current form of the state The segregation/apartheid heritage • Weak system of innovation • Human capital constraint • Small local markets • Relative isolation from global S&T networks • Wasteful state administration structures • Distorted economic geography • Transitions • 1916-1948: drive to modernity • 1948-1994: the apartheid NSI

4. Evolution of the current form of the statePost-apartheid • GEAR (1996) • Neoliberal • Structural continuity • Review of GEAR (2001) • Sub-target growth, investment, savings and enduring unemployment • negative net FDI (excluding M&A investment) • Unchanged human capital constraint (poverty, education) • Post-Polokwane • Possibility of a third stage

5. Periodisation of STI policy • Two STI policy documents • 1916: empire driven (integrated planning but short lived) • 1996: NSI driven (White Paper) • The White Paper and GEAR • Institutional build-up (DACST, NRF, NACI, Innovation Fund) • Policy fragmentation and isolation of STI • Post-GEAR • DACST to DST • Transfer of CSIR from DTI to DST • Strategic intervention increased in S&T • Neutral intervention in the broader NSI

6. Post-apartheid performance of the system of S&T • R&D intensity has increased consistently since 2001 • Share of government financed R&D dropped over 2001-2004 but rose sharply in 2005 • Weak relationship between financing and performance patterns • Drop in share of HEI R&D performance

7. Human CapitalS&T • An aging and shrinking scientific population • Black and women scientists, technologists and engineers are not entering the academic ranks • In 1990, the percentage of scientific publications produced by researchers 50 years of age and older was 18% (one in five), but by 1998 this figure had increased to 45% (one in two). • Between 1990 and 1998 the percentage of publications by black scientists rose from 3,5% to 8% (less than one in ten). Participation by women has not changed over the 1990s, with publication output being about 10% of the total. • Currently, there is less than one researcher for every thousand members of the workforce, as compared with five in Australia and ten in Japan. (NRDS, 2002: 21)

8. Human CapitalBroad based • Low numeracy and literacy rates • HDI dropped consistently over 1995-2005 • Increasing income inequality • Increasing within racial classifications • Decreasing between racial classifications • The integrity of the family unit and the uncertainty of human capital formation • High unemployment • Single parent households • HIV/AIDS • Inadequate provision of basic needs

9. Regional (intra-NSI) disparities • HDI • Education • Migration flows • STI

10. STI-specific policies1996 White Paper • Starting point • SANSI designed to meet the requirements of apartheid • Badly coordinated STI policy • Strategy • Integrating and coordinating STI initiatives across government departments • Prepare a government wide science budget • Management of government SET institutions with appropriate M&E mechanisms

11. STI-specific policies1996 White Paper Shortcomings • Low priority indicated by placing within the state architecture • No interface with other policy areas (trade, industrial, labour, and primary and secondary education) • No demand side initiatives to compensate for the erosion of the military-industrial-complex (lost opportunity with the commitment for the provision of basic needs) • Supply side policy limited to direct R&D subsidies • Coordination was allocated to Ministers’ Committee on S&T; a weak coordinating mechanism reinforcing “silo” STI planning

12. STI-specific objectives2002 NRDS • Enhancing innovation • Address the “innovation chasm” • Development of social sciences to understand the SANSI • Coordination of funding instruments • Poverty reduction orientation • ICT and biotechnology • SMMEs and BBEE • Agricultural orientation of R&D to establish an indigenous value chain • Provincial convergence

13. STI-specific objectives2002 NRDS • SET human resources and transformation • Addresses matriculation rates and maths and science enrolment • Rationalisation of state S&T system and infrastructure • Eradication of “silo” policy formulation • Alignment with the national economic (and social) development strategies • Private sector interventions • Tax incentives for R&D • Provincial innovation initiatives, such as incubators to be run by the proposed Foundation for Technological Innovation • Dedicated funding for global technology sourcing aimed at small and medium firms complemented by information drives to expose local firms to new sources of technology • Venture capital in the form of seed and early-stage venture capital for high-technology businesses, in conjunction with the DTI

14. Ten year innovation plan (2007) Recognised constraints • Human capital development • “Human capital pipeline” from post-grad students to recognised researchers • Low R&D levels and intensities • Poor knowledge infrastructure • sub-optimal levels of ancillary functions, such as finance, that impede the flow from R&D to innovation

15. Technology development and innovation Farmer to Pharma Human & social science Global change Energy Space science Human capital - Centres of excellence, South African research chairs initiative, professional development programme, etc. Enablers Cross- cutting enablers Grand challenges Knowledge infrastructure – Science councils, state-owned enterprises, global projects Ten year innovation plan (2007)targeted intervention GRAND CHALLENGES

16. Ten year innovation plan (2007)Technology Innovation Agency • Provide funding and complementary services to bridge the “innovation chasm” • Stimulate development of technology intensive services and products • Provide an intellectual property support platform • Stimulate investment (venture capital, FDI, etc.) • Promote development of human capital

17. Broader policy frameworkHuman Resource Development Strategy (2001) • Targets • Improve Human Development Index • Improve basic social infrastructure • Reduce income inequality • Gini coefficient • Improve international confidence • International Competitiveness League ranking

18. Broader policy frameworkIndustrial policy • Goals of the Microeconomic Reform Strategy (2002): • Growth • Competitiveness • Employment • Small business development • Black economic empowerment • Geographic spread of economic activity

19. Broader policy frameworkMacroeconomic Strategy (AsgiSA, 2004) • AsgiSA identifies the following constraints: • Currency volatility • Inefficient national logistics system whose infrastructure lacks the required capacity for growth • Shortage of skilled labour • Market concentration, monopoly power and barriers to entry • Limited new investment opportunities • Regulatory environment which is not appropriate for the SME sector; labour law was identified as one of the constraints • Shortcomings in state organisation, capacity and management

20. Broader policy frameworkHRD - AsgiSA interventions • Build a strong foundation in public schooling • Focus on priority areas in tertiary education and training • Initiate and improve work-based training programmes and scarce skills initiatives • Establish a joint council in government to strengthen and co-ordinate the activities to address the skills shortage • The urgent need for skills, which are a necessary input for AsgiSA programmes, led to the idea of creating a short- to medium-term troubleshooting approach towards skills challenges.

21. Broader policy frameworkHRD – JIPSA (2004) interventions • Five high-profile priority skills areas for immediate attention: • engineering and planning skills for the ‘network industries’ – transport, communications, water, energy • city, urban and regional planning and engineering skills • artisanal and technical skills, with priority attention to infrastructure development, housing and energy, and in other areas identified as being in strong demand in the labour market • management and planning skills in education and health • Mathematics, Science and language competence in public schooling. • Systematic process of discussion with key ‘project owners’ and role-players regarding the skills required to underpin AsgiSA projects • Constraints and inefficiencies in the current frameworks and institutional arrangements for skills delivery • analysis of the problem of unemployed graduates • strengthening of the labour market and skills information system • the National Qualifications Framework Review and quality assurance mechanisms • analysis of artisan training capacity

22. Broader policy frameworkFramework on local development (2006) • Based on New Institutionalism • Convergence of economic and social policy • Conditions for successful local development • Human capital • Institutional networks • Linkages across municipal, provincial, national, continental and global systems

23. Inter-NSI integration2007 SADC Protocol on STI • Establish institutional mechanisms in order to strengthen regional cooperation on and coordination of science, technology and innovation • Institute management and coordination structures, with clearly defined functions, which will facilitate the implementation of regional STI programmes • Promote the development and harmonisation of science, technology and innovation policies in the Region • Pool resources for scientific research, technological development within the Region • Promote public understanding and awareness of and meaningful participation in these disciplines • Eliminate restrictions that restrict the free movement of scientists, technologist and engineers for the purposes of education, research and participation in joint STI programmes.

24. Recommendations • Strengthen the coordinating role of the DST to eliminate “silo” planning • Redefine “human capital pipeline” to include primary and secondary education (planning integration with DoE and DoL) • Poverty eradication • Build indigenous STI component in all state construction and infrastructure programmes – demand side incentives • LSI convergence

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