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Thursday, 30 April 1987
Page: 2091

Senator VIGOR(3.59) —The tenth and final report of the Australian Industrial Research and Development Incentives Board marks a watershed in our approach to industrial innovation. It is fitting that the Board, to whose members and staff I pay the highest tribute for their dedication and commitment, has examined the whole 10-year period of its existence. The report is quite forthright, however, about the difficulties which confronted the Board because of all the Public Service red tape which has been applied to it and because the departments with which it was connected felt that they often knew better than the Board. This is a problem that we need to tackle with through establishing better relations between specialist statutory bodies and the departments which manage them or act as their interface with the Government.

Failure to understand the process of innovation will, I believe, mean that we will continue to trek down the perilous path towards a banana republic. If we do understand it, however, I believe we can get off that track. Refusal to recognise that development and control of technology in Australian hands is indeed crucial and will, I believe, result in a much better understanding of how we can be competitive in the world. Otherwise we are in danger of becoming an assembly plant for overseas ideas. Our talented people under those circumstances will look elsewhere for opportunities and the real wealth will continue to flow overseas.

This is certainly one reason why I sought, and succeeded in getting, an amendment to the grants for the industrial research and development incentives scheme, which has replaced the Australian industrial research and development incentives scheme, AIRDIS, to allow it to fund technology transfer. Without proper technology infrastructure we remain at the mercy of multinational companies and overseas entrepreneurs, who can force their own conditions on us, because they, unlike us, have access to the necessary infrastructure. To obtain that technology infrastructure we need conscious acts by government. We need to have support and intervention and not just the mindless cutbacks, such as the abolition of the information distribution section of the Patent, Trade Marks and Designs Office, which occurred in the last Budget.

When we look at the funding provided by the Australian Industrial Research and Development Incentives Board we notice that more and more of the grants are going to small companies, especially under the commencement grant component. This is a good thing. There is a problem however, with the middle-sized firms which do not have the technical backup to push their ideas on world markets, nor the ability or size to set up their own research organisations. The ability to contract out research, providing we can get the Commonwealth Scientific and Industrial Research Organisation and private enterprise to take a lively interest, is indeed a very important option, but again there is a need for many more sources of venture capital. Without that willingness to invest we will miss out on many opportunities.

We will miss out also because of the unfortunate tendency to look at the process of innovation from the origin of an idea to the availability of a product or service as a linear process. It may be possible to construct a linear process from a product back to the research, but the process of actually getting a product on to the market from research is never a linear process. The research starts in a general, searching way, out of one of the limbs of the search comes development and out of one of the limbs of development comes a product. We have to recognise this. Research requires management techniques quite different from conventional bureaucracy, and the processes are diffuse and not linear. They are not hierarchical and they are not necessarily predictable. Australia needs to train itself to get and keep some of these entrepreneurial skills. If we are going to put more value-added into our products we must master the technique of managing research.

Question resolved in the affirmative.