Universities’ king-sized contribution to Australian innovation has a downside, because it funnels resources into strongholds of student recruitment rather than research driven by national needs, according to a panel reviewing the country’s research and development system.
A newly released report says higher education’s 35 per cent share of Australian R&D expenditure – a A$14 billion (£7.1 billion) investment, much of it bankrolled from overseas students’ fees – “comes at the cost of other strategic agendas”.
“The substantial reliance on international student revenue by Australian universities means that R&D capacity is linked to enrolment patterns in student markets,” warns the discussion paper for the government-commissioned Strategic Examination of R&D. “It does not reflect the quality and impact of research or its contribution to national priorities.
“Setting R&D profiles in response to student enrolment can hinder building strategic research agendas. This would prevent prioritising local industry needs or aggregating effort and resources to achieve world-leading research and technology outcomes.”
Research funding arrangements are a “critical constraint” on publicly funded institutions, which need “patient investment through [a] stable mechanism that can also deal with the increasing costs”, the paper says.
It says that competitive research grant money for Australian universities increased by 140 per cent between 2001 and 2022. Over the same period, funding for indirect R&D costs such as administration, utilities and maintenance grew just 49 per cent.
Overall R&D spending crashed from 2.24 per cent of gross domestic product (GDP) in 2009 to 1.66 per cent in 2022, it says. “R&D investment is below our peers. The need for change is inarguable.”
The paper examines other problems, including gaps in infrastructure and a dearth of experimental development. “Our research output is laudable and our talent pool is substantial. Yet our economy and our culture have not been able to…translate research into products and services at meaningful scale…despite decades of inspiring rhetoric,” it says.
“Boosting a focus on R&D will prevent Australia’s slide into mediocrity.”
Universities Australia said both sides of politics should take heed ahead of a looming federal election. “In the face of declining government funding, universities have relied on international student revenue to fund critical research activities,” said chief executive Luke Sheehy. “This is no longer a safe bet.”
Australian Technology Network executive director Ant Bagshaw said Australia needed to do more to translate its “world-class” research into “real-world” impact. “That means targeted investment in research translation, better incentives for industry to partner with universities, and a renewed focus on applied and experimental development.”
The Group of Eight said Australian research and development spending as a proportion of GDP lagged international norms by a full percentage point. “Now is the time for bold economic leadership to maximise our future prosperity,” said chief executive Vicki Thomson.
The Australian Academy of Science said “incremental adjustments” would never be enough to fix a research and development system that lacked scale and “any semblance of strategic organisation”.
The review was recommended by the Australian Universities Accord panel last February and flagged in the May budget. The discussion paper, which was published on 12 February, describes itself as “the beginning of a year-long process”.
It poses 10 questions around issues including policy settings, funding sources and a “national culture of innovation excellence”. Responses are due by 11 April, when the election campaign is likely to be in full swing.
