IP: Effect of Public Policy on R&D in Australia

[Dave Farber <farber () cis upenn edu>]

       ASIAN TECHNOLOGY INFORMATION PROGRAM (ATIP)


REPORT:  ATIP98.054 : Effect of Public Policy on R&D in Australia
To: Distribution
From: reports () atip or jp
      This is file name "atip98.054"
Date:  6 Jul 1998
ATIP98.054: Effect of Public Policy on R&D in Australia


ABSTRACT:  This report assesses the effects of public policy and new
directions in corporatization, privatization, and outsourcing on
Australian R&D over the past ten years. The findings summarize oral
submissions at a set of hearings held recently in Sydney, which are a
part of an on-going inquiry of the House of Representatives Standing
Committee on Industry, Science and Technology. A representative
examples, comparisons are made with Telstra Research Laboratories and
the University of New South Wales.


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Copyright (c) 1998 by the Asian Technology Information Program (ATIP)
This material may not be published, modified or otherwise redistributed
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        Effect of Public Policy on R&D in Australia
                         (ATIP/Sydney)




CONTENTS


1    INTRODUCTION
2.   R&D IN AUSTRALIA
2.1     Amount Of R&D Conducted
2.2     Nature Of R&D ("Basic" or "Applied")
2.2.1     CRC's
2.3.    Relevance Of R&D To Industry Needs
2.4.    Investment In Research Infrastructure/Equipment
2.5.    S&T Skills Base & Demand For Scientists, Technologists, Engineers
2.6.    Education And Training Opportunities For Future Research Staff
3.   CASE STUDIES
3.1.    Telecommunications Research
3.2     Australian Photonics CRC
3.3     Telstra Research Laboratories
3.3.1.    R&D at Telstra
3.3.2.    Basic or Applied R&D
3.3.3.    Investment In Research Infrastructure And Equipment
3.3.4.    Skills Base
3.3.5.    Education and Training
3.4.    University of New South Wales
3.4.1     R&D
3.4.2.    Basic Or Applied Research
3.4.3.    R&D And Industry Needs
3.4.4.    Investment In Research Infrastructure And Equipment
3.4.5.    Skills base
3.4.6.    Education And Training
4.   CONCLUSION
5.   CONTACTS


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1.  INTRODUCTION


Government policies and new directions in corporatisation
("rightsizing"), privatization (of public companies) and outsourcing
have all played their part in bringing about changes to the face of
Australian industry over the past ten years. By heavily applying market
forces, a possible danger of these policies is that they may ignore the
potential benefits of what is essentially a long-term activity in
systems which do not respond positively to short-term changes of
direction.


These changes include policies that promote more reliance on
self-funding of research, seen in the rise of the Cooperative Research
Centers, introduction of competition policy and privatization of former
public companies such as utilities and the prime telecom carrier,
Telstra. Within the private sector, meanwhile, changing taxation
patterns, rise of the subcontracting culture, and the the perceived
influence of shareholder value have all placed more emphasis on
short-term planning. Together these changes have affected the level of
R&D being done not only in the public sector but also in the private
sector. The effects may be intentional or unintentional, beneficial or
undesirable.


This report attempts to access the impact of government policy changes
over the past ten years on:  (1) the amount of R&D being carried out in
Australia, (2) the nature of the R&D being undertaken (that is, basic or
applied),  (3) the relevance of the R&D to industry needs,  (4) the
level of investment in research infrastructure and equipment, (5) the
scientific and technological skills base and, (6) the demand for
scientists, technologists and engineers, and the education and training
opportunities for future research staff.


The above categories are being analyzed in 48 submissions sent (thus
far) to the House of Representatives Standing Committee on Industry,
Science and Technology. This report summarizes some of the oral
submissions given at a recent hearing in Sydney, April 30. Overall,
these points-of-view reflect various sectors of the R&D community, such
as universities, governmental research institutes, venture firms,
technology parks and major research companies, including telecom-related
organizations.


One notable aspect of R&D in Australia is the lack of industry spending.
Australian business has a lower propensity to invest in R&D than do
business sectors in other major OECD countries.  For the year 1996/97,
there has been a decline in the actual business spending on R&D. The
figures show A$3.57 billion spent so far in 96/97 compared with A$4.26
billion spent in 95/96. There has also been a drop in the number of
businesses claiming a tax deduction for R&D following the cut in the
benefit from 150% to 125%.


As the topic under review in the inquiry is quite broad, it is difficult
to identify and comment on specific examples, however, a few case
studies are given from Telstra Research Laboratories and the University
of New South Wales.  The following report summarizes opinions given at
the hearing.


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==============END OF REPORT