Any R&D strategy developed by the federal government should focus on supporting intellectual property that can be licensed to overseas manufacturers rather than creating local mass production, according to Science and Technology Australia president Sharath Sriram.
Following an address at the National Press Club on Wednesday, Professor Sriram said there was a need for a “more stable strategy which brings the parts of the [research] ecosystem together” to push Australia’s R&D spend closer to three per cent.
He said that trying to compete globally in mass production “will not be our strength”. Instead, Australia should focus on creating “high value jobs, high value services, based on our ideas and intellectual property which is where you draw value from”.
“It could be businesses generating intellectual property, which companies’ internationally license to manufacture, or they manufacture the most special part and send it overseas,” Professor Sriram said.
He later added that Australia could locally “make the low volumes for our population, but then licence the technology overseas to make elsewhere”. Owning innovative IP, he argues, will allow wealth to still flow to Australia without vast manufacturing operations.
For example, while no smartphones are manufactured locally, Sydney-based semiconductor firm Morse Micro has designed “some of the most advanced Wi-Fi chipsets” that are being manufactured in Taiwan and Singapore.
Professor Sriram also said the whole of government strategy should focus on streamlining how government R&D programs can be accessed.
While describing Industry and Science minister as a “kid in a candy shop” when discussing science and innovation opportunities, he said the government needs to actually increase its focus on supporting R&D, with the value of its own investment having fallen to record lows.
“It is a challenge though, as they’re having to balance priorities on what to invest in, and my message here is this has to be a super high priority,” Professor Sriram said.
The University Accords, released at the end of February, highlighted the need for a review of research innovation that would inform a whole-of-government strategy on driving R&D investment.
This would be led by the Industry department in coordination with other departments, however, the government has yet to formally respond to the Accords. The federal government currently has around 150-line items in its budget that support R&D across 13 government portfolios.
While these should be aligned with the National Science and Research Priorities, Professor Sriram said each government agency is well placed to continue administering its own R&D programs, rather than a new “super org” overseeing all government expenditure on R&D programs.
A quick win to improve the coordination of government R&D programs, would be to streamline the application process through a single point of entry, which would help “demystify the system”.
“What frustrates most research grant applicants is that each system has a different application portal, a different application template, and different ways you word things…that is the biggest [coordination opportunity] I can see in the near term,” he said.
Professor Sriram also told InnovationAus.com that the STA is still supportive of a ‘patent box’ scheme that would provide tax breaks for income on innovative intellectual property (IP).
While a patent box scheme was announced in October 2021 under the former Coalition government, enabling legislation did not make it through the House of Representatives before the last federal election was called in April 2022.
