NOTE: Francis Collins discusses the effect of U.S. budget cuts on NIH. The interview, recorded ahead of the Sept. 14 OMB report on sequestration, will be shown in full on the Sept. 23 edition of BioCentury This Week television.
Budget sequestration would reduce FDA's FY13 budget by $319 million, including about $112 million in user fees, according to a report released Friday by the White House Office of Management and Budget. Industry would be obligated to pay user fees in full, but FDA would be unable to spend the sequestered portion of the fees. Sequestration is slated to go into effect on Jan. 2, 2013.
The Budget Control Act (BCA) of 2011 requires across-the-board cuts, or sequestration, of federal budgets as a result of the failure of the Joint Select Committee on Deficit Reduction to propose, and Congress to enact, a plan to reduce the deficit by $1.2 trillion.
The White House expressed its opposition to sequestration on Friday and called on members of Congress to "work together to produce a balanced plan that achieves at least the level of deficit reduction agreed to in the BCA that the president can sign to avoid sequestration." The cuts imposed by sequestration set new budget baselines and, under the BCA, would remain in effect for a decade.
The BCA limits sequestration to 2% of Medicare's budget, resulting in an $11.1 billion cut in FY13. The cuts would come entirely from payments to providers and would not reduce benefits, according to OMB. Sequestration would also cut NIH's FY13 budget by $2.5 billion, or 8% (see below).
Unless Congress acts to prevent or modify budget sequestration, NIH's budget will be cut by $2.5 billion in FY13 to $28 billion, according to a report released Friday by the White House Office of Management and Budget. The Congressional Budget Office estimates that sequestration would cause NIH to "lose the ability to fund about 2,300 grants that we otherwise planned to support" in 2013, NIH Director Francis Collins told BioCentury. NIH would be forced to eliminate about a quarter of the grants it planned to award in 2013, making it "the worst year that anybody could ever remember as far as your chance to get started in a new research project."
Collins said the cuts "could be a devastating blow" to young scientists. "I'm sure we would end up losing a significant fraction of our current generation of talent, which would not be something you could just turn back on again a few years later if you decided to change your mind," he said.
BioCentury This Week television will broadcast a separate interview with Collins on Sept. 23 about advancing science in an era of fiscal austerity.