Parliament Updates

10 February 2022

Ms STEGGALL (Warringah) (12:50): Today I rise to speak on the Australian Research Council Amendment Bill 2021. This bill will amend the Australian Research Council Act to index appropriations and provide a new funding cap, commencing in 2024. These are administrative changes that I support. The Australian Research Council is a statutory Commonwealth agency under the ARC Act. For 20 years the ARC's fundamental purpose has been to grow knowledge and innovation in the national interest and for the Australian community. This kind of innovation aims to underpin positive environmental, social and economic outcomes. The ARC does this by advising the government on research matters as well as administering the National Competitive Grants Program, Excellence in Research for Australia, and the engagement and impact evaluation assessment frameworks. The ARC runs various funding schemes under the banner of linkage programs, which encourage research collaborations between researchers and a range of different styles of organisations, including private enterprise, community organisations and other research agencies.

In 2021 the ARC had its 20-year anniversary, and it has achieved a lot. Since being established, the ARC has awarded over $13 billion in over 29,000 research grants. There are 1,100 research projects funded each year. The Commonwealth invests in research and development in many ways, but the ARC forms a large part of it. The ARC administers roughly 6.8 per cent of the Commonwealth's total investment in research and development. This is a substantial amount. The ARC has partially funded 74 centres of excellence with industry and universities, and centres of excellence foster collaboration between research organisations, businesses and universities. Centres of excellence usually undertake innovative transformation research, and recent centres have focused on issues like recycling and even dark matter.

The ARC supports industrial transformation research hubs, which engage researchers to investigate new technologies and economic, commercial and social transformations. Usually, these are to benefit industry partners. Alongside this are ARC industrial transformation training centres, which help facilitate innovation and postdoctoral training for research industries. The ARC also brokers crucial partnerships between government, business and academia, international institutions and community organisations, with over 9,000 domestic and international partnerships over the last 20 years.

There is a lot to be celebrated. While several reviews into the ARC have highlighted areas for improvement, the importance of the ARC just cannot be understated. Through its fostering of world-leading research, the ARC is central to Australia's innovation performance. Innovation crucially underpins our economic prosperity and wellbeing. It is directly tied to productivity. Just look at how innovation has brought us through this pandemic. From the mRNA vaccines to telehealth, the benefits are clear. Innovation is crucial for both our economic recovery and our long-term resilience as we emerge from this pandemic. The ARC is a fundamental pillar of what I call the new economy. The new economy is forward focused, sustainable, decarbonised and, importantly, built on innovation. It's an economy where our research delivers revolutions in consumer goods and services. It's where our research takes on the big issues of our times: climate change, artificial intelligence, automation and biodiversity loss—and beats those challenges, comes up with the solutions. Breakthroughs like the cochlear implant and wi-fi are many in this economy, and new jobs and prosperity are delivered.

In Warringah we're lucky to have various innovation and research hubs that support this vision of a new economy, from the Lakeba Future Hub to the SEVENmile Venture Lab. They're incubating the next iteration of products, services and businesses. And Warringah's workforce is supporting the new economy, with 23.9 per cent of people in Warringah engaged in professional, scientific and technical services—the leading employer in the electorate.

But more can be done. To fully enact the vision of the new economy requires the Commonwealth government to invest in research and development through agencies like the ARC. Whilst this bill will provide an extra $10 billion to $12 billion per annum in appropriations, it still falls well short of what we need to get Australia ahead of the curve, really leading the way and opening up that door to the new economy. Australia is falling further and further behind the rest of the world on innovation. We were once ranked 17th in the world, according to the global innovation index, and we've slipped to 25th this year. It's no surprise, because Australia's total private and public research and development spend is falling behind that of our global peers.

Currently we invest 1.8 per cent of GDP in research and development, and that's down from a high of 2.2 per cent in 2008. It leaves us at the back of the pack of OECD countries. We are half the average of OECD countries. Israel and South Korea, for example, both have spends of up to four per cent of GDP on their R&D. The impact of this extra investment is noticeable. Many of the world's best tech startups originate in these two pioneering countries.

The economic benefits of investing more in research and development are manyfold. A recent CSIRO report found that, for each dollar invested in R&D, an average of $3.50 in economic benefits came out of it. That is good investment. If we want to have better living standards and protect our environment, our communities and our way of life, we had best innovate—and innovate fast. We can improve our performance by increasing the appropriations for the ARC. Bold investment through the ARC will have immediate effect. An additional barrier is a lack of commercialisation of our world-class research, despite linkage programs supported by the ARC. Collaboration between industry and research institutions underpins innovation, and it will be critical in order to support jobs growth in our recovery and in dealing with our current and future challenges.

So, I support the government's announcement of a $2 billion fund that will take research and facilitate the development of marketable products and services with financial incentives. But let's get real: it's the very least we could do after the pandemic devastated our universities. Additionally, if we're really serious we will engage with national moonshot programs, which are national high-ambition, high-payoff ventures. We can look at doing these in areas of comparative advantage. Some of the sectors we should look at are space, space quantum, quantum, artificial intelligence, biotechnology, clean technology and digitisation.

Future jobs in innovation require advanced science, technology, engineering and mathematics skills. Seventy-five per cent of the fastest growing occupations require significant STEM skills and knowledge, and STEM based employment is projected to grow at almost twice the pace of other occupations. Unfortunately, the STEM performance in our schools is lacking. It's leaving a brains gap for business and affecting our innovation, and I suggest it would be a better focus for the government than worrying about ideology and culture wars and how one should be reinterpreting history to suit ideology. STEM is the most important area of our future.

We can't ignore, either, the unfortunately vast gender disparity in STEM studies. According to the Chief Scientist, STEM is still 79 per cent male dominated, and we know that gender and cultural diversity and research drives better innovation outcomes and has been linked to organisation performance. It is a win-win when you fix the gender divide. We therefore need a comprehensive plan to address both the achievement gap in STEM and the gender disparity in participation in STEM. All this should be tied together with a comprehensive strategy to coordinate, plan and outline core objectives for national industry innovation in Australia.

Unfortunately, we can't talk about this bill and this funding for the ARC without discussing the government's poor performance on research grants. Last month, a group of the country's most eminent scientists and researchers spoke out against the minister's decision to block grants for six projects. These projects had been evaluated and elevated for funding by an independent panel. The arms-length process is designed to place funding for the most meritorious projects away from political interference. The announcement of successful grants was also delayed. The researchers should have known in November if they made the cut, and instead they had to wait until Christmas Eve. This is extraordinary. People may not understand why, but it's because delay impacts outcomes. For 30 years, they've been awarded on time, in the fourth quarter. That is what the scientists and people in the sector could rely on. The delayed announcement caused substantial uncertainty for many researchers, who were pinning future research on these grants. So researchers who aimed to collaborate with industry risked losing those very important relationships due to the time delay and through no fault of their own.

If an independent process, designed to be impartial, recommends certain grants, then the government should follow its guidance and award them in a timely manner. Too many times we have seen the Morrison government overrule departments and other bodies just to rort the process with their own cherrypicked selections. We need more accountability to be built into this process. If the minister chooses to reject a grant, he or she should table a statement of reasons setting out a clear rationale for such a move, because the funds we are allocating are public funds and they should be allocated with transparency and in accordance with the process that has been approved.

In conclusion, the ARC plays a crucial role in supporting innovation in Australia. It's part of our new economy. I want to see it be a bigger part of the new economy we are capable of building, but it does require vision and it requires commitment to letting go of the past and actually moving forward towards new technologies. We are limping to the back of the pack with our performance on innovation. This is acting as a drag on our productivity and our economic growth, and so many young people know this and fear this, because they are ambitious; they are hungry for success. I know this because I meet so many of them in Warringah.

We can become leaders once again and ensure decades of prosperity, but only if we embrace just some of the limited policies that I have set out as being part of a new economy. We must consider the challenges we have ahead. We have big challenges ahead, in the next decade in particular, in relation to global warming and climate change, but we also have the skills, the willpower and the smarts. We have the smart workforce to do this. We have the innovation and the R&D. We actually need to let go of the past, be brave and ambitious and look towards building a more prosperous and a clean and sustainable future, and we will do that with innovation.