Innovating Australia

  Last updated March 7, 2017 at 1:05 pm


Director Paul Willis comments on the recently announced National Innovation and Science Agenda released by the government. 

For too long Australia has been lamenting the dilemma that it has faced since the rise of science here in the late 1800s: we produce some of the brightest minds in the world who in-turn make monumental discoveries and advancements but very few of these are transformed into economic production at home. So, we have either watched as those bright, young, clever people move overseas taking their bright ideas with them or we have stood by and watched the bright ideas fade and fail in an economy that struggles to innovate. We look on with envy at other nations that have the knack for innovation and we marvel at how they apply that ability to build robust, diverse and healthy economies. But, as long as we can make an easier living digging stuff up or growing food and produce for other people, there’s been little incentive to encourage the innovation culture that seems so ripe for the picking.

Now here we are after the biggest mining boom we have ever seen and having watched our limited manufacturing base dwindle into oblivion, we need to get serious about our problems around innovation. If only we could foster that knack into our culture, perhaps we would have the economic strength to grow beyond mines and paddocks.

That’s principally the thinking behind the recent innovation statement by the Federal Government. They looked into the whole process of innovation in Australia and made the same observation that has been made by many others about the translation of science into business: we’re really good at the science end of things but lousy at using business to commercialise the research conducted across the nation.

Such a systemic problem requires a systemic answer. It’s not simply a problem that you can throw money at, promoting big projects in the hope that they will grow into an innovation culture. We need to look at where the blockages are in the pipeline and see what we can do to unblock those conduits for wealth generation.

There’s a couple of stats that have been bandied around in the lament for the lack of innovation. Firstly Australia invests a below average amount of its GDP into research and secondly the government proportion of funding of research in Australia is much higher than many other advanced economies. These two are of course intimately related – essentially it is the private sector that has not been pulling its weigh when it comes to putting money into R&D. In Australia around 80% of R&D money comes from government, in most other developed economies 80% of R&D money comes from business. So anything we can do to encourage business to get involved has to be a step in the right direction.

So why doesn’t business invest in science in Australia? There are several reasons but they mostly revolve around the endemic business culture. It’s too risky to invest in research here and the penalties for failure are too high. Elsewhere there is a business environment that buffers against the penalties of failure such as more lenient bankruptcy laws and generous taxation incentives to carry over losses and spread the pain from one year to another. If you want to invest in research then you have to be allowed to fail and to grow from that failure – that’s the nature of research but it’s not the nature of the Australian business environment.

When reviewing the innovation statement there are many ways that the Federal Government has tried to create the business environment that is more conducive to innovative activities. They have increased access to company losses, looked at intangible asset depreciation and reviewed the insolvency laws which should combine to create an innovative business culture that’s willing to take risks. Peak business bodies such as the Australian Institute of Company Directors have been calling for some of these changes for a long time and they’ve welcomed this announcement.

Raising funds and making money for research easier to find have seen changes to the nature of venture capital funding, improved efficiency of crowd-sourced funds and tax incentives for investors. There are several funds to be set up, re-established or beefed up including funding to the CSIRO, new funding arrangements with universities around research, and a biomedical translation fund. By putting money back into research organisations such as the CSIRO, the Government is also attending to the other end of the innovation pipeline. But, as stated earlier, we need to work out how to get corporate Australia to put its hands into their own pockets to fund basic research.

Then there is the awarding of money to areas of research where the potential for innovation abounds such as quantum computing, cyber security and the Square Kilometre Array. On one hand this looks like picking winners but it does neatly dovetail into the Science Priorities statement released the week before the innovation statement in which nine areas of interest were identified.

There are also initiatives to make the whole innovation process as inclusive as possible with recognition of the need for women in STEM and the more general spread of STEM subjects across the education system. They are also appealing to both expat Australian brains now overseas and new foreign minds to come here and be part of a new ‘Ideas Economy’.

All up this is a pretty comprehensive and systemic approach to a very broad question effecting many sectors of the economy, but can I make one observation here? Certainly in the media coverage around the innovation statement so far and hinted at by the tenor of the public statements from the Federal Government, innovation is promoted as geeks on computers mostly doing fun stuff in the entertainment industry. Most media stories I’ve seen come straight out of technology parks across the nation featuring bright young people working on graphic animations for movies and video games. We have to take on a much broader understanding of what innovation really is. It’s a process translating research science into practical applications in the real world. There is more for us to gain out of innovation in the agricultural, resources and medical research industries than trying to compete with Silicon Valley in building new online widgets (not that we should not be doing that as well!). So, when you think of innovation, don’t just think of geeks in front of computer screens making a squillion bucks with their start-up online companies. Think of innovations in genetic engineering as they can be applied to agriculture and medical research. Think of innovations in data processing in astronomy that might be applied to the resource sector or adapted to communication of the future. Think of innovations in nanotechnology and the material sciences that can be applied to building environmentally friendly, in-expensive housing or that may drive developments in the alternative energy industry. In short, my observation is that we need to broaden our popular conception of what innovation is if we are to fully realise its potential.

All up, this is a most invigorating review of innovation as a process in Australia and it proposes changes to the system that promises to unleash this nation’s innovative potential. And it must be noted that this is the first major statement made by the Turnbull Government on any subject which clearly indicates the importance they attach to the ability of science, research and innovation to underpin a whole new economy. But, as some observers have noted, such systemic changes to an economy must be given time to work. We are unlikely to see a return on investments within a few years and most of these changes will not bear fruit for more than a decade. This is a change to the fabric of Australian society, a new approach to the importance of science and the translation of science into the wellbeing of the Australia in the future. We must innovate. There’s no future for Australia in the economics of the last millennium.

To learn more, read our article: The NISA Breakdown and What You Need To Know

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About the Author

Paul Willis
Paul is a respected leader in the science community with an impressive career in science. He has a background in vertebrate palaeontology, studying the fossils of crocodiles and other reptiles. He also has a long history as a science communicator, with a career spanning as Director of The Royal Institution of Australia, presenter and host for Australia’s Science Channel, working for the ABC on TV programs such as Catalyst and Quantum as well as radio and online. He’s written books and articles on dinosaurs, fossils and rocks and is finding new ways to engage the people of Australia with the science that underpins their world. Follow him on Twitter @fossilcrox.

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The Royal Institution of Australia is an independent charity, and the sister organisation of the prestigious Royal Institution of Great Britain, tasked with promoting public awareness and understanding of science.

The Royal Institution of Australia is passionate about building and connecting communities engaged with science, and as such works closely with scientific organisations, institutions, universities from Australia, and leaders to inspire the next generation of innovators and to create a lasting legacy for Australia.

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