Mr MARTYN EVANS (10:32 PM) —Australian science will always be a sound enterprise, given the quality of the people and institutions which underpin the endeavour. But, taken as a whole, science now lacks public policy direction and vision. In the context of this parliament, we seem to be running towards an election even though the term of this parliament still has something like nearly a year to run, but it does seem as if the Prime Minister (Mr Howard) is in election mode. Following his third budget, something which the House is debating this evening, it is indeed appropriate at this two-year mark to review those three Howard budgets in the context of science and to see how science and innovation have fared under this government.

That can be best expressed in a quotation from the President of FASTS, the Federation of Australian Scientific and Technological Societies. In response to the budget document, Professor Peter Cullen said:

This Government seems bereft of ideas. Competitive success in the next century will be won by countries which follow the knowledge-based path, to generate real and enduring employment.

This requires a strong science base and smart programs to link industry with science. This needs strong leadership from Government.

That is not what we are getting from this government in the area of science. Let us look at the way in which this government has treated the various aspects of our science budget.

Again, in this year's budget statement and the budget speech by the Treasurer (Mr Costello) there was no mention of science or of innovation or of research and development. Unfortunately, the government has again failed to highlight in the Treasurer's budget speech the importance of science and technology, of innovation and of research and development in the generation of economic wealth in this country and securing jobs for Australians in the next century.

We have many fine institutions in this country who have a long and proud record of public sector science. The CSIRO, our CRCs and the universities are all institutions that have contributed a lot to Australian science over the years and have ensured that this country has a sound base on which to build a good scientific reputation in the world.

The CSIRO is an organisation which this government promised, when it was in opposition, would benefit from a substantial injection of public funds. Unfortunately, the promise was honoured both in the undertaking and in the breach. The funds were provided to CSIRO but additional funds were taken from CSIRO to bring that total back to a net negative for the organisation. Although the additional funding was provided, the final consequence, as is so often the case with this government, has been a record of failure, a record of withdrawing funding rather than boosting it. The same is true of the CRCs, the cooperative research centres, which are such a good mechanism for bringing industry, academics, leading edge research and postgraduate students together in one environment which is well directed towards the applied benefit of industry. Those CRCs have again seen their overall budget reduced.

After allowing the CRCs to be suspended in a period of disbelief following the Mortimer report, which recommended the abolition of the program, the government referred that to a committee, spent months taking advice on the subject and then finally decided to continue the program at a slightly reduced level. How was that to inspire confidence in the CRCs, in their supporters and in the private sector partners who fund the CRCs' work? Naturally, they were left very unsure of this government's response to the CRC program and were left very unsure of the strength of their commitment to it.

The universities have always been a mainstay of public sector science in this country. There is a very substantial contribution by academic research to future job creation opportunities by industry. Academic research indeed has a very high percentage return as an investment. The estimates from the United States are that academic research returns perhaps 25 per cent on the investment made in it in terms of the economic wealth which it subsequently generates for the country. Estimates by the academies of science are that the universities in this country, under the Howard government, have suffered something like a $3 billion reversal where costs have been transferred to parents, to students and out of the public sector purse. The universities have suffered considerably as a result of that and their funding is significantly depleted.

Science suffers even more in that context. Good science is expensive to do. Good science costs dollars in the universities. A university faced with a reduction in funding under this government will turn first to its science budget and cut that first, because that is where the money is, that is where the easy reductions can take place. University administrators, confronted by a declining base in their funds and confronted by a declining base in infrastructure funding in grants from government institutions like the ARC, are bound to cut the science budgets first because of the cost.

What message has this government sent to science and engineering students themselves? Well, it nearly doubled their HECS fees contribution. Any government that believes in market forces and then doubles the cost to students of doing a science degree in this country can only expect—as will subsequently prove to be the case—that students will respond to those market forces in the way we know they will; that is, by withdrawing from science courses in the universities.

New enrolments in science in our universities have declined under this government for the very simple reason that the government sent science students a very powerful message about the way in which it values their future career and about the way in which it values science in Australia by doubling the cost of their degree to them. Of course, students have had to withdraw from those courses in significant numbers. I think the cost of that to the nation will not be felt for many years, but it will be a very real and very powerful cost.

One thing which exemplifies what value is placed on science by this government is the way in which they have treated the position of Chief Scientist. One of the first decisions of this government on coming to office just over two years ago was to reduce the funding for the position of Chief Scientist in the federal government from a full-time position to a one day a week job. Any government that can reduce the funding for its Chief Scientist and say, `This is a part-time job of one day a week,' clearly does not take science as a very serious undertaking. It may have been better if the government had scrapped the position altogether, if they had been honest and up-front about it and said, `Look, we don't value science and we're reducing the funding to just a day a week.'

That has still not been restored in this budget. That is something which I consider it to be a very serious insult to the science community. I believe the Chief Scientist actually contributes a fair bit more than a day a week because he understands the importance of his job. We are probably taking advantage of his good will and gaining more than what we pay him for. While that is a credit to him, it is certainly a debit to this government.

What has happened to many of the other important science programs under this government? In the very early part of their term, they reduced the R&D tax concession from 150 per cent to 125 per cent and they abolished the syndication scheme. The Treasurer has sought, and continues to seek, to portray the syndication arrangements and R&D funding generally as a tax rort. He has sought to diminish the value of this in industry and business by painting them as nothing but rorters, as people who have had their hands in the public trough in some improper way. Of course, there is always the opportunity for dishonest people to exploit any version of the tax concession.

But I happen to believe that the R&D tax concessions and the syndication schemes sent a very strong message to industry that the Labor government of the day—certainly not this government—valued very highly industrial research and development. It also valued the mechanism whereby companies who had substantial amounts of taxable income could assist those start-up companies who were ideas rich but cash poor with a syndicated R&D scheme under which resources were transferred to the company that needed the innovative break and that needed the assistance. But, of course, that scheme has been entirely abolished.

If we look at the overall funding for some of the important programs like R&D support, we see that it is in decline. That is best summarised by looking at the government's own budget papers. If we turn to Budget Paper No. 1 where the government sets out its budget philosophy and we look at government support for science and innovation, the government's own words in describing that budget are very revealing. They say:

Total outlays decline slightly over the forward estimates. This is largely explained by a decline in ARC—

that is, the Australian Research Council—

funding for research infrastructure, collaborative research grants and the High Performance Computing and Communications Programme.

So this government itself describes in the budget papers a decline in overall funding, and how true that is. If we look at the constant price summary of major Commonwealth support for science and innovation through the budget and other measures, which again is a table from that budget paper document, we see that science is very much in decline under this government. The reality is that science funding under the Commonwealth budget is now back to 1993 levels.

I know that the Prime Minister wanted Australians to be relaxed and comfortable, and I think the decade in which the Prime Minister would have been most relaxed and most comfortable would have been the 1950s. Well, he is very slowing driving the science budget back to the 1950s. We are already back to 1993. That is the last time when in real consequent dollars science funding was at the same level that it is now. We have seen an approximate 11 per cent decline in science funding in real terms under this government. I expect that that represents their view of the importance of science research and innovation.

But the reality is that the importance of science is very different from that. Although the new Minister for Industry, Science and Tourism, Mr Moore—in his first budget as science minister following the resignation of the former minister—claimed after this year's budget that science funding was $90 million up, I am afraid that is somewhat of a misleading of the public and of this parliament. The reality is that, although in strict actual dollar terms, the budget is $90 million up, on the government's own figures that is minus one-half of one per cent in real terms. Combined with the previous budgets where science funding dropped some nine per cent, in real terms we see that it is this year down half a per cent of the total budget. Contrary to the minister's assertion that it is $90 million up, the reality is that after inflation his budget is significantly down.

Why is all this so important to the country? It is important because science is not a cost; it is an investment. Education is an investment. Science and education go hand in hand in ensuring that this country has a competitive place in a globally competitive world in the next century. The reality is that if Australia is to take a real and meaningful role in the Asia-Pacific region in the next century—if it is to be a high wage, high skill country and not a low wage, low skill country—and not just a farm and quarry for the rest of the world, then we need real investment in science, in innovation and in education to ensure our people are able to meet those challenges in the next century.

Science and innovation can deliver to this country a real future, one which people will be very pleased to leave to their children. It can certainly be said in very clear terms that our greatest responsibility is to be good ancestors. If we are good ancestors to the next generation, then we will have made a real contribution during our term of office in this parliament and in any term of government that the people may bestow on us. In that context, the best thing that we can do is to bequeath to the next generation a very sound economy and a sound education system—one which values science and innovation and one which encourages, through the overall public policy budget, strong investment by business in science and in research and development.

So we have all of those factors coming together. We need sound public policy in CSIRO, in the CRCs and in the universities. We need strong investment in R&D by the private sector to ensure that the jobs are there in the next century. We need the government to provide the necessary leadership and to send the right messages to the community to ensure that this process occurs as we have discussed this evening.

The reality is that this government have abandoned any attempt at leadership in the science infrastructure. Their constant reduction of budgets, their dismantling of programs, the declining forward estimates, the messages they send to students by doubling the HECS fees, the messages they send to the community and the universities by slashing tertiary sector expenditure all combine to show a complete lack of leadership in science and public policy, as the academies of science and the Federation of Australian Scientific and Technological Societies have all recognised in their budget response. This government has lost the opportunity that this budget presented to make a strong investment in science and R&D. It is a budget of lost opportunities and one which will be a real cost to this nation for decades to come.