Australia is languishing at the "bottom of the class" when it comes to research and development investment, and scientists need to stop waiting for other nations to adopt their breakthroughs to validate them, the industry and science minister says.
Ed Husic issued the warnings at the National Press Club on Wednesday, while releasing a discussion paper into the state of R&D in Australia.
But while he announced that the nation's investment in research had fallen, Mr Husic stopped short of committing to a national target or tax incentives to encourage businesses to spend more.
The discussion paper, produced by a group of business and industry figures led by Tesla chair Robyn Denholm, found Australia's investment in R&D projects had fallen over 15 years to 1.66 per cent of its gross domestic product, significantly below the OECD average.
Despite a strong need for innovation in areas such as disease, disability, climate change, cybersecurity and digital privacy, the paper noted many local breakthroughs were not being harnessed in Australia.
"Australian research is being developed into globally transformational technologies, most often by other countries," the report found.
"The old approach – waiting on other nations to turn our ideas and discoveries into products and services that we then adopt at a higher cost – is not the path we want or need."
Australian businesses needed to increase spending on R&D projects to turn the trend around, Mr Husic said, and should hold bigger ambitions than being "the best customer on an app store".
"We are consistently among the top performers for research at our unis," he said.
"We're at the bottom of the class for getting that research into the economy."
Greater spending on research projects would not only create more jobs but boost productivity within businesses, Mr Husic said, and could make breakthroughs necessary in a wide variety of fields.
The discussion paper was designed to identify specific areas in need of investment, he said, and businesses should seize opportunities rather than waiting for financial incentives from the government.
"People do R&D because they know it's good for them – I don't need a tax incentive to brush my teeth," Mr Husic said.
"There comes a point ... that businesses recognise it's important in particularly competitive markets to get an edge and that coming up with new ways of doing things will be crucial."
The Business Council of Australia welcomed the discussion paper's findings on Wednesday, with chief executive Bran Black saying many companies wanted to expand their research efforts.
"Businesses stand ready to do more research and development activity in Australia, but they are being held back by policy settings that don't do enough to encourage innovation or large-scale business investment," he said.
Lifting the $150 million R&D expenditure threshold to $250 million would encourage investment, Mr Black said, and businesses could benefit from stronger collaboration with universities.
Submissions to the R&D consultation will remain open until April 11.
