The innovation statement brought down by the Government this week has much to commend it. Australia’s performance in research and development has been getting worse for a decade. The percentage of GDP Australia spends on research and development is well below that of major Organisation of Economic Cooperation and Development countries, and below even some countries emerging from the old Eastern Bloc, such as the Czech Republic. It has been causing a brain drain, as discouraged researchers left Australia to places where their talents were better recognised and those that had invented and discovered left to places which took a greater financial interest in developing.
In an increasingly globalised economy, Australia has been in danger of losing its position in the top rank of nations on the standard-of-living scale. In this environment, Australia could no longer rely on natural resources as the main component of wealth generation. The lesson of the past decade or so has been that brains and education generate wealth.
In an election year, it is easy to question the motives of a Government.
The most welcome aspect of the Government’s statement is that it put education, knowledge, research and innovation on the political map, at least this election year, and probably for some years hence. Both major parties have now recognised that the Australia people are interested in education and the long-term future of the nation. The Government’s statement could be seen as merely catch-up politics to prevent Labor stealing the march with its “”Knowledge Nation” approach. The Government, however, argues that it has spent 18 months putting together this statement. The Government’s claim that it is not merely matching Labor is backed up by the amount of detail in its statement, compared to Labor Leader Kim Beazley’s fairly waffly approach which has dealt more in aspirational statements than hard policy detail.
Whether one accepts Labor’s or the Government’s view of that, the important fact is that both parties have this singularly important policy area as a high priority.
Two elements of Labor’s attack on the statement, however, are telling. The first is that this is merely putting back was had earlier been taken away. When the Howard Government came to office, it slashed spending on research, development and tertiary education by about $5 billion, according to Labor. It now proposes to put back $2.9 billion. Inevitably the Government rejects those figures, even so there has been a deal of take and then give – governments usually work that way.
The other disappointing element of the statement is that such a small amount of money is ear-marked for 2001-02 (4 per cent in fact). More than half the amount of the five-year program will be spent in the last two years – two elections away. By then, this week’s statement will be long forgotten. The Government argues that it has to look after the Budget surplus, first. Maybe so, but surely innovation is so important that some earlier reworking of the priorities would be in order.
That said, the tightening of abuse, refocusing and new cash rebate system in the research and development tax system is welcome. So, too, is the fact that lion’s share of the money will be going to the public sector. That is a welcome change of approach by this government. It is at last a recognition that not all things can best be done by the private sector – pure research is one. It is crucial for Australia that it stay at world standards in research, even if we spend only a small percentage of the world’s input. By staying at the cutting edge, even in limited areas, we gain a huge amount by global sharing of knowledge that occurs at that level.