House debates

Monday, 30 November 2015

Grievance Debate

Research and Development

6:09 pm

Photo of Ian GoodenoughIan Goodenough (Moore, Liberal Party) Share this | | Hansard source

In contributing to the grievance debate, I wish to make the case for greater investment in the commercialisation of local research and development in order to ensure that our domestic economy derives the maximum benefit from Australian intellectual creativity. Too often we witness the migration of Australian inventions overseas due to a lack of opportunities to raise the necessary venture capital to bring these home-grown innovations to market. Businesses and universities must work more closely together to innovate and build the industries of the future. A more strategic approach needs to be taken to promote the commercialisation of applied research, which will link technical knowledge with business principles that will see new ideas developed, commercialised and sold.

The Chamber of Commerce and Industry of Western Australia released a report earlier this month containing a vision statement to achieve a sixfold increase in research and development spending totalling $24 billion by the private sector in the next 20 years. Australia has remained ranked at No. 17 in the Global Innovation Index for the past two years after a period of improvement in the preceding years. Australian patent applications by local residents only make up 10 per cent of total applications. It is concerning to note that Australian residents file roughly three times more patents overseas then they file in Australia. In 2014, only 202 patent applications were filed in Western Australia. Whilst an adequate level of patent activity is difficult to specify, IP Australia reports that the number of patent applications made in Australia fell by 13 per cent in 2014.

I make special mention of a constituent of mine, Mr Kevin Fairman, who is a talented electrical engineer and inventor and who has just navigated the very costly process of registering a patent for a high-contrasting film product he developed with the potential for signage and automotive applications. Mr Fairman, through his company, Fairman Dent Pty Ltd, has experienced a number of obstacles in attracting local investment to develop and commercialise his innovative product. He wants to keep his invention in Australia but may be forced to seek overseas backers.

In international experience, there is a growing realisation across government, education institutions and businesses that universities can play central role in providing high-level skills, world-class research bases and promote a culture of inquiry and innovation. A recent report prepared by the federal government estimates that fewer than five per cent of Australian businesses currently utilise the higher education sector for expertise and knowledge. While Australia boasts a world-class university sector, relatively little of the considerable research output translates into patents or commercial success. Unfortunately, according to the Industry Innovation and Competitiveness Agenda, Australia has been recently ranked as 81st out of the 143 countries for the efficiency with which it turns its innovation inputs to outputs. Studies have suggested that Australia has a poor record of collaboration between research and industry.

Reform options include removing specific barriers to innovation at the enterprise level and reallocating resources into more innovation focused activities throughout the economy. According to the Australian Bureau of Statistics, across the whole economy, just 652 Australian companies raised venture capital financing totalling $7.9 billion in 2013-14, representing less than 0.2 per cent of gross domestic product. This compares unfavourably with most OECD countries, with venture capital financing as a percentage of GDP higher in just about every OECD country outside some European states.

Consideration should be given to linking public investment undertaken at universities with private sector commercialisation. Another reform which could significantly contribute to empowering the culture of innovation is the need to reduce regulation, ease taxes and remove barriers to business start-ups. Small businesses also need to leverage the innovation generated by the university sector.

One possible initiative is the development of public-private research and commercialisation centres housed within universities, facilitating research collaboration between the universities and corporate businesses. Whilst in their early stages, these models of research allow for private sector input into decision-making and help build bridges between pure and applied research, with commercialisation outcomes that will see new ideas developed, commercialised and sold.

Edith Cowan University in my electorate has developed a very strategic approach to the functions of research, development, innovation, industry collaboration and commercialisation. The university realises that significant administrative effort is required to support and manage the business case for applied research. Too often, scientific and technical aspects of research and development are not matched by business principles required to commercialise applied research.

Under the leadership of Professor Margaret Jones, the Office of Research and Innovation provides strategic and operational support for the university's research program, and plays a crucial role in facilitating research outcomes beyond the laboratory. The Office of Research and Innovation builds ECU's research profile by providing administrative support to researchers and by developing and implementing research policies. Providing links to a range of external agencies, particularly research funding bodies, it is the first point of contact for staff seeking assistance in identifying funding opportunities and it provides advice on applications and submissions to funding agencies. The Office of Research and Innovation manages the administration of awarded grants, including contractual requirements and progress and final reports.

Other key functions include the development and submission of applications for external research funding, the commercialisation of intellectual property, the facilitation of collaborations, the provision of research ethics advice, the provision of industry liaison and promotion, and the facilitation of internal funding schemes. The Office of Research and Innovation is also responsible for the annual collection of research performance data for the federal government's higher education research data collection and the Excellence in Research for Australia initiative.

In addition, the collaborative research network led by Edith Cowan University focuses on growing research excellence at the university through partnership and engagement. It aims to create world-class research capacity and outcomes through collaborative partnerships with nine universities across Australia. The collaborative research network program is part of a suite of initiatives established by the federal Government to reform higher education, teaching, learning, research and research training. The program aims to lead to a more productive and more effective university system by focusing on quality, excellence, collaboration, sustainability and end-user engagement.

In summary, businesses and universities must work closely together in order to ensure that our domestic economy derives maximum benefit from Australian intellectual creativity. A more strategic approach needs to be taken nationally to promote the commercialisation of applied research that will see new ideas developed, commercialised and sold. This will stem the flow of Australian inventions going overseas due to a lack of opportunities to bring these home grown innovations to market.