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Monday, 29 October 2012
Page: 12354

Dr WASHER (Moore) (11:16): I rise to speak on Labor's Mid-Year Economic and Fiscal Outlook decision to freeze funding for vital Australian university research and development. I particularly draw attention to the short-sighted, cynical political decision to withdraw or freeze funding for university, medical and academic research on which this country totally depends to underscore its reputation as a bright country, not just a lucky country.

This government tries to justify huge undisclosed taxpayer subsidies to the motor vehicle industry as it throws away a smart future for this country. The car industry here is no longer viable and needs to reform itself to reflect the reality of global economic conditions and trends, but not at taxpayers' expense. Now this government has ripped $1 billion out of university research and student support funding in a desperate attempt to fill its budget black hole.

The latest victim of these cuts is the world's leading cutting-edge solar cell technology project at the University of New South Wales. A total of $24 million allocated to this vital new research area has been put on hold indefinitely thanks to the Labor government's obsession with a worthless surplus. This decision to kill university research funding for the vital research on which this country depends for its economic future means the future of hundreds of thousands of young careers are on the chopping block and the birthright of a younger generation who will rely on the jobs that would have been created has been stolen.

The Labor debt pile is mounting by $100 million a day, excusing the $2.4 billion that has been cut from education and training funding, of which $1 billion comes from university's research and student support. Australia has a unique skills set and is world class in innovation across biotechnology. This field includes therapeutics, devices and diagnostics for human and agricultural use, as well as industrial and environmental technology.

We excel in engineering, nanotechnologies, IT, telecommunications and manufacturing. Continuity of government funding is an absolute prerequisite because of the high risks and length of time to market. Those options are now being denied to start up, and early stage companies are facing increasing scarce venture capital at early development stage. Fund freezing will delay major programs that are potentially huge revenue winners domestically and at export level. Previous coalition and Labor federal government programs such as the Innovation Investment Fund, R&D Start, Commercial Ready, COMET, Biotechnology Innovation Fund and now Commercialisation Australia have been welcomed by the biotech sector, as well as all areas of innovation. They have played a vital and significant role in ensuring the continuation of innovation in this country.

The sudden closure of Commercial Ready in May 2008 left the biotech sector—indeed all areas of innovation—without a program for nearly two years, until the Commercialisation Australia program commenced in January 2010. More than six months were wasted because of the funding delay in bringing this program back up to speed. Some companies shut down as a direct result and many jobs were lost. The impact on the sector was significant and damaging. This government has taken from universities and research institutions vital programs such as the Sustainable Research Excellence program, worth $498.8 million. Also, the facilitation performance funding from 2014, worth $270.1 million, will be deferred; student support for masters research degrees at $167 million will be deferred; and start-up scholarships, worth $82.3 million, will be frozen.

Australia's pharmaceutical sector, dependent on institutional or clinical research in this country, is another vital sector affected by these cuts. In 2011-12, exports of pharmaceutical and medicinal products totalled $4.1 billion, up from $3.7 billion the year before. Pharmaceuticals are now firmly established as a high-level export earner, about four times the value of motor vehicle export sales, which continue to fall. Asia takes half of Australia's exports, and industry believes there are opportunities to multiply exports five-fold by 2020. Investment in research has underpinned the improved quality of health care for Australians over the past 50 years and has a fundamental role in improving the future effectiveness and efficiency of the $130 billion health system. An additional dollar spent on research has a multiplier effect by driving efficiency and new practices, compared with an additional dollar spent on general health care. Investment of an additional $2 billion to $3 billion a year on research for the health system is required within 10 years— (Time expired)