Review of the National Innovation System: Venturousaustralia – building strength in innovation

The Australian Academy of Technological Sciences and Engineering (ATSE) welcomes the report on the Review of the National Innovation System, entitled “Venturousaustralia – building strength in innovation”. The report has many sound recommendations that are supported by ATSE. This Review will provide a timely signal to government and industry in Australia that the nation needs to reinvigorate and better fund innovation, which has seen government funding diminish considerably in the past decade.

The response from the Academy is focussed on those areas where there are either omissions or where further development is required of the recommendations contained in the Report. The Academy’s response is based on comments received from a number of Fellows, including some input from key leaders in industry.

In general terms, ATSE considers that the report is perhaps too focused on assisting public sector research and that inadequate attention has been paid to new mechanisms likely to support a strong focus on innovation in Australian industry, to encourage industry to expand its expenditure on R&D significantly and to promote collaboration between industry and research providers. The primary policy goal should be to promote structural and cultural change through the achievement of much more dynamic innovation in industry, firms and government. ASTE considers that the report does not adequately address the deficiencies of previous policy frameworks. In a number of key areas related to industry, ATSE believes that the recommendations require further development if we are to achieve the innovation objectives.

The Academy notes that the Report follows on from earlier reviews (for example, ‘The Chance to Change”) highlighting the importance of innovation to the Australian economy. ATSE is clearly of the view that time has now come for a significant effort to support innovation in Australia. Furthermore, ATSE is prepared to assist in the further development of innovation policies arising from this Review and in the implementation of the associated framework.

The Academy notes that the Report follows on from earlier reviews (for example, “The Chance to Change”) highlighting the importance of innovation to the Australian economy. ATSE is clearly of the view that time has now come for a significant effort to support innovation in Australia. Furthermore, ATSE is prepared to assist in the further development of innovation policies arising from this Review and in the implementation of the associated framework.

SUMMARY

While ATSE supports the broad thrust of the “Venturousaustralia – building strength in innovation”, the Academy considers that the following matters deserve further attention:

• The Academy supports the introduction of the proposed tax credit scheme; this should be done as a matter of urgency. Consideration should be given to providing additional credits to those organisations that undertake collaboration with publicly funded research institutions (PFRIs) and that undertake innovation in the national priorities areas.
• While the Report comments on the desirability of collaboration between research providers and industry, identifying preferred mechanisms of collaboration and support for such mechanisms should be a priority task for the new National Innovation Council.
• ATSE strongly supports the Competitive Innovation Grants Program, but questions the requirement to repay grants from royalties because of administrative requirements which will make the cost benefit questionable.
• There are high costs and risks in later stages of technological innovation. Government needs to recognise that increasing the rewards or reducing the risks is the critical issue in administering the innovation/ promotion programs recommended by the Review.
• The Academy considers that the proposed National Innovation Priorities should be subjected to a more extensive foresighting approach.
• The Academy supports that public sector research be fully funded and that the level of government support for R&D be lifted to international standards and that this be achieved over a five-year time frame.
• The Academy is concerned that the Excellence in Research for Australia is focused principally on competitive grant income and publications in highly ranked journals. The ERA must have a reward component to foster collaborative links that will enhance innovation.
• While broadly supporting the proposed governance framework, the Academy considers that an Innovation Committee of Cabinet should be constituted to focus on the development of strategic initiatives for innovation and the allocation of funding for national innovation priorities and to coordinate the many departments involved in innovation. This would be advised by the National Innovation Council.
• ASTE believes that there might be merit in mirroring overseas practice in establishing a statutory body in Australia to be responsible for funding both research and industry support related to innovation.
• ATSE calls for an increase the numbers of science, technology, engineering and mathematics (STEM) graduates from Australian universities by mechanisms such as reducing fees in these disciplines in recognition of the key roles that these graduates play in innovation.
• ATSE calls for a 10-year strategic plan to increase Australian innovation.