calendar tag arrow download print
Skip to content

Government funding of R&D

fact sheet
18 April 2023

Photo: Peter Hilz/Hollandse Hoogte

Governments are important financiers of R&D. In the Netherlands, government finances about a third of total R&D expenditure. In this factsheet we provide insight into Dutch government spending on Research & Development (R&D) and innovation. And place these publications in an international perspective. We also look at regional and European expenditure.

In short

  • Absolute government R&D expenditure rises from 4.7 billion in 2012 to 7.8 billion in 2022.
  • The ministries of Higher Education, Culture and Science and Economic Affairs together fund 84% of R&D expenditures in 2022.
  • Indirect R&D expenditure of the Dutch government is above the average of the EU-27.

The fact sheet is divided into five sections. We look at:

  1. national government expenditure on R&D;
  2. national government expenditure on innovation;
  3. national government expenditure in international perspective;
  4. regional expenditure;
  5. European expenditure.

1. Developments in government expenditure on R&D

The government finances R&D directly (through basic or project financing) or indirectly (in the form of tax support).

The following graph shows from 2000 the two forms of government support for R&D - both direct financing and fiscal support. Direct investments are presented as a percentage of gross domestic product (gdp) to place them in the context of the economy.

      Government expenditures and percentage GDP

Source: Rathenau Instituut (TWIN)
Notes: The numbers are based on the various budgets of the departments. It concerns the budgets for R&D of the national government: the budgets of the provinces are not included in this. The fiscal part only concerns the WBSO / RDA, which is aimed at R&D (MIA / VAMIL are only aimed at innovation and are not included here).

In the graph above, we see government direct R&D expenditure (in euros) increasing annually up to 2011. There was a decline in 2012. Subsequently, the total amount of government support in the long-term budget shows a slightly increasing trend until 2017. From 2017 to 2018, R&D expenditure rose sharply due to the extra investments from the 2017 Coalition Agreement. The increases from 2021 are mainly due to the National Growth Fund and the Ministry of Education.

The following table looks at the development of R&D expenditure per department in the period 2021-2022. An innovation-relevant component can be distinguished within R&D expenditure, which we will return to later in this fact sheet. 

Government R&D budgets by ministry, in millions of euros and as percentage of GDP

2021 2022
Realization Preliminary
Education, Culture and Science 4853,9 5323,7
Economic Affairs and Climate Policy 865,3 1233,2
Health, Welfare and Sport 515,9 488
Agriculture, Nature and Food Quality 238,7 254,9
Defence 189,8 180,5
Infrastructure and Water Management 89,2 117,8
Foreign Affairs 46,2 118,9
Justice and Security 24 24,8
Social Affairs and Employment 12,3 12,6
Interior and Kingdom Relations 11,1 11,6
General Affairs 0,7 0,6
National Growth Fund 0 0
Total 6847,1 7766,6
Total in percentage of GDP 0,8 0,82

The table shows that the Ministry of Education, Culture and Science and the Ministry of Economic Affairs and Climate Policy are by far the two largest financiers of R&D, together responsible for 84 percent of the expenditure in 2022. From 2021, resources from the National Growth Fund are also part of the R&D funding. These ensure that R&D expenditure increases. Within the expenditure of the Ministry of Education, Culture and Science, the university's first funding stream accounts for the largest part. The expenditures also rise sharply from 2023 onwards.

R&D expenditure is increasing over the years. Government R&D expenditure as a percentage of GDP increased to 0.80 in 2021. 

2. Innovation and innovation-related expenditure

Since 2014, figures on government spending on innovation have been gathered alongside government spending on R&D. The collection of data on innovation expenditure is in its infancy, however.

The following table shows the different forms of government support for R&D and innovation for 2021-2022. In 2022, 78% of the total government contribution to R&D and innovation will consist of direct expenditure on R&D. 15% consists of indirect tax aid for R&D and innovation. Direct innovation expenditure is 7%.

Direct and indirect financial support for R&D and innovation, in millions of euros

2021 2022
Realisation Provisional
R&D expenditure 6847,1 7766,6
of which innovation relevant 1315 1555,3
Expenditures on non-R&D innovation 447,3 671,7
Fiscal support for R&D and innovation 1565 1480
of which only for innovation 149 139
Total expenditure for R&D and innovation 8859,3 9918,3

3. International comparison of government funding of R&D

How does R&D spending in the Netherlands compare with that in other countries? The figure below compares government spending on R&D (as a proportion of GDP) in a number of European countries. The figure shows that the Netherlands is slightly above the average of the EU-27 countries.

For a good comparison, fiscal support should also be included in direct R&D expenditure. Most countries have such schemes; only a few do not (yet) (Germany and Switzerland). If looking at indirect R&D expenditure, the Netherlands is above the EU-27 average (see data publication Government support for R&D, in % of GDP). As percentage of GDP, the size of government support through tax incentives varies from 0 to 0.31%; in the Netherlands it is 0.15% (2020).

4. Regional

Activities related to knowledge and innovation also take place at regional level, though few figures have been gathered on this. However, a survey of funding for knowledge development and innovation at regional level was carried out for the 2013-2019 edition of TWIN. This funding comprises European resources, provincial resources and matched funding from central government. Regional development agencies, management authorities and other regional organisations are also involved. Up to and including 2021, the budgets that the provinces committed for knowledge and innovation were between €137 and €270 million. These investments are higher in 2020, 2021 and 2022, partly because extra resources have been made available in connection with COVID-19, but also because of new projects and initiatives. The provinces have budgeted a total of € 249 million for knowledge and innovation in 2022.

5. Europe

The European Union also contributes to the funding of R&D in the Netherlands. Since 1984 this has mainly been in the form of funding under the Framework Programmes, which has grown steadily. Horizon 2020 (2014-2020) had a total budget of €77 billion. Horizon Europe (2021-2017) started medio April 2021 and has a total budget of €96 billion. Dutch institutions, both public and private, acquired a relatively large amount of funding from Horizon 2020 and Horizon Europe so far, amounting to one-and-a-half times the Dutch contribution to the programme. The share of European public funding in total public R&D funding in the Netherlands has grown from 9% during the 7th Framework programme to 13% for Horizon 2020. In 2021, the first year of Horizon Europa, the share of European public funding was 13%. The average annual income from this source between 2014 and 2020 was €769 million.