The government’s $15 billion National Reconstruction Fund should be used to rebalance the way Australian research and development has been supported in Australia after a decade of business tax breaks failed to lift overall levels, according to the peak university group.
Universities Australia (UA) wants the Albanese government’s flagship industry support program to invest specifically in projects that involve “substantial amounts of research and development (R&D) and are driven by university-industry collaboration”.
The peak group also wants a higher education representative on the National Reconstruction Fund (NRF) reference group that will guide the fund’s development – a group that is otherwise expected to be made up of industry and finance figures.
Other university groups agreed the government could get better returns by making university involved R&D projects a focus for the NRF, or at least require it to take a holistic approach that considers other parts or the innovation ecosystem, like Trailblazer Universities and the commercialisation grants program, when deciding which ventures to back.
The Group of Eight universities has also called for a $500m carve out from the industry fund for technology projects not yet ready for market.
The NRF will invest $15 billion through loans, equity investments and guarantees into seven priority areas like renewables, medical manufacturing, value-adding in resources, advanced manufacturing and “critical technologies”.
It is facing a tougher than expected passage through Parliament after the Coalition pulled its support for the Labor election commitment, but consultations on the policy and underlying legislation are well advanced.
In its submission to the policy consultation on the NRF, UA encouraged the government to “apply the seven priorities widely” and specifically invest in projects that involve “a high degree of collaboration between businesses and university researchers”.
The group, representing institutions like the ANU, the University of Sydney, UTS and University of Melbourne, argues NRF support will drive an ideas boom, train more researches and graduate more students for the more complex economy Industry minister Ed Husic is aiming for.
The massive investment vehicle should also “complement” the traditional government approach to indirectly supporting R&D indirectly with the R&D Tax Incentive.
UA said the government’s RDTI expenditure had risen sharply over the decade to $2,919 billion last year but had not translated to higher levels of overall business investment.
“The numbers show that despite the increase in indirect incentives, business investment in research has declined to levels that may reduce Australia’s capacity. A large injection of direct funding through the NRF may reverse the trend,” the UA submission said.
The university group said using the NRF as a from of direct investment in R&D would help overcome long time barriers to businesses commercialising research and forging university partnerships, and called for addressing theses collaboration challenges to be part of the NRF’s “policy objective”.
UA also “strongly urges” the government to include a higher education representative on the reference group that will help establish the fund’s investment mandate. Mr Husic, who will appoint the group along with Finance minister Katy Gallagher, has so far said the group will include “leading figures in industry and investment circles”.
The Group of Eight universities have also backed the fund as a “much-needed investment in Australia’s ability” and raised similar concerns with falling business investment in R&D.
The Go8 universities – representing around 70-per cent of Australian university research – have been left to “pick up the slack”, the group’s NRF submission said.
While it stops short of recommending the NRF be directed to universities generally, noting the nature of the NRF means it will go to the “end of the innovation pipeline”, the Go8 does recommend the $15 billion fund operate as “part of a coordinated innovation support system”.
With the NRF supporting later stage innovations and the Economic Accelerator grants supporting projects from proof of concept and testing on, there is a gap for earlier stage innovations, the Go8 said.
“This means researchers must rely on the existing pool of competitive and oversubscribed research funding to develop their ideas and discoveries. For the NRF to effectively support the commercialisation of research, the Government must address the underlying vulnerability of Australia’s research funding system.”
The Go8 is proposing a $500 million carve out from the NRF – matched dollar for dollar with the private sector –specifically for innovation that is early in its commercialisation journey in the NRF’s seven priority areas.
“This would create a $1 billion vehicle to support the new technologies needed for the NRF’s investment mandate, while still allowing it to maintain a diverse range of investment activities,” the submission said.
Go8 also called for a “nuanced” way of measuring the NRF’s return on investment, because the bold bets it makes may not translate to a direct commercial outcome initially but could still deliver “partial advances and key learnings” that should not be discounted.
Like UA, the Go8 wants the NRD Reference Group to have someone from the sector who is suitably qualified individual with experience in successfully commercialising university research”.
The Australian Technology Network (ATN) of Universities said the NRF will be at its best when encouraging investment in in universities and the research output they generate.
The group, representing six impact focused universities, said universities should be seen by the NRF as “key linkers and enablers” of research and skills, with a particular focus on the six Trailblazer universities.
The Trailblazer universities are already receiving $50 million each from the government to build new research capabilities around commercialisation outcomes, several of which align with the NRF’s priority areas.
The ATN, which counts four of the Trailblazer universities among its members, recommended the NRF target the outputs from the new ventures with its $15 billion.
“The impact and legacy of these Trailblazers and other research and innovation initiatives, relies on having the local expertise and capability needed to adapt, translate and operationalise Australian and overseas solutions and innovations,” the ATN submission said.
“We must develop emerging and future industries and jobs, as it develops the people with the skills to ensure that they will thrive in them.”
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