Database House Hansard
Date 03-11-1983
Source House of Reps
Parl No. 33
Electorate LALOR
Interjector Dr Harry Edwards
Mr Simmons
Mr Groom
Mr Gayler
Page 2350
Party ALP
Context Miscellaneous
System Id chamber/hansardr/1983-11-03/0109


Mr BARRY JONES (Minister for Science and Technology)(9.26) —Mr Deputy Speaker, I could hardly believe my good luck that this motion came on tonight. ( Quorum formed) I concede freely that in April when the National Economic Summit Conference was held in this chamber I was unable to speak and my paper ' Technology and Australia's Future', was not circulated. However, the Government took the view that the aim of the April Summit was to reach consensus on a national strategy for economic recovery to replace a long era of industrial confrontation with one of co-operation and to make the prices and incomes accord work.

The Summit, in its final communique, acknowledged the significance of technology as a factor in changing our economic base while not giving it the central position in international growth which was recognised at the Versailles Economic Summit of June 1982. I was disappointed at the time but since then I have come to recognise that what I wanted to say in April would have been too abrasive and too confrontationist for the Summit and could well have threatened the fragile consensus that was achieved. The occupants of 'lifeboat Australia' first had to stop belting each other over the head with their oars. Next we had to ensure that the lifeboat was not going to capsize and this was achieved, not without difficulty, during the recent budgetary process. The next stage was to work out where the lifeboat was to go-to set the direction towards the year 2000 and beyond. To that end the Prime Minister (Mr Hawke), approved the calling of a three-day National Technology Conference so that the issues which seemed inappropriate in April could be discussed at length. We did not use the word ' summit' because it seemed to me that one can only really climb a mountain to the summit approximately once every millenium.

We met in Canberra from 26 September to 28 September. About 140 people were invited both in a personal and a representative capacity-The Commonwealth Scientific and Industrial Research Organisation, universities and the colleges of advanced education, medical research institutions, new industries such as computing, electronics and biotechnology, bankers and investors, the trade union movement as well as many representatives of traditional industries, State governments, Federal Ministers and department heads. Government speakers included the Prime Minister, the Minister for Industry and Commerce (Senator Button), the Minister for Employment and Industrial Relations (Mr Willis) and me . There were also Ministers for Technology from New South Wales, Victoria, Western Australia and South Australia. Amongst other speakers were Professor Ralph Slatyer, the Chairman of the Australian Science and Technology Council, Hugh Stretton, one of Australia's great social philosophers from the University of Adelaide, Dr Paul Wild, the Chairman of CSIRO, Sir Frank Espie, who chaired the recent High Technology Financing Committee and, indeed, the honourable member for Berowra (Dr Harry Edwards).

Dr Harry Edwards —All sleepers, I presume.

Mr BARRY JONES —They dozed at times. Within five months views of mine, which had appeared threatening and unorthodox in April, had been accepted as the conventional wisdom. I do not conceal my gratification at that. My opening speech 'Technology and Australia's Future' was a revision-a toughening, I may say-of my Summit paper. Given the nature of the notice of motion tonight I take this opportunity to table a copy of the April document. I said that the primary aim of the Conference was to achieve the 'shock of recognition' of where Australia is placed by the dramatic sweep of technological change. I take up a number of points made by the honourable member for Berowra. Of course, I readily recognise that Australia is not the only nation going through that post- industrial effect, that long--

Dr Harry Edwards —You talk as if it is.

Mr BARRY JONES —No, I never do. I always talk of it in a global context. I never talk or write of it as if it is a completely unique phenomenon here. It is a general phenomenon which is common to all Western societies; I have always said that. In fact there has been a--

Mr Simmons —That is the theme of your book.

Mr BARRY JONES —In fact that is the theme of my book. There has been a paradigm shift in our economic base away from resources and muscle power towards skills and particularly towards information. The point that I made is that when one asks people to identify the commonest example of an employer or an employee is in Australia, it is commonplace for them almost invariably to answer 'A process worker in a factory', although that has not been true for a long time. I said at the conference, quite correctly, that to a large extent, the least successful part of the Conference was to achieve that 'shock of recognition'. I think the reason was that many of the people who were there felt compelled to defend entrenched positions. They felt inclined, for example, when they were speaking about universities, to say that the universities were doing a wonderful job and in the case of the CSIRO they said that it was doing as well as could be expected and in the case of Australian management it was to be regarded as perhaps the eighth wonder of the world. The trade union movement was perhaps disposed to say that there was nothing whatever that needed revision in its attitude towards technological change.

But the point is that we had to begin somewhere. One of the things that we have tried to stress within industry-I thought that the honourable member for Berowra would pick this up-is that it is not enough to say that the Government will increase its expenditure in research and development and industry, the private sector, needs make no contribution at all. I think one of the problems in Australia in the last few years has been that very striking increase in the proportion of government expenditure as expressed as a proportion of the total. I think the last figures I saw indicated that, for every dollar spent on research and development in Australia the Government spent 78c of every dollar and industry contributed only 22c. In other words, industry is really contributing to its own destruction. It is not doing anything to bring about its own salvation. That is partly, of course compounded--

Mr Groom —Who produced the figures?

Mr BARRY JONES —The Australian Statistician. It is clear enough; it is published . The honourable member would find exactly the same figure in last year's technology statement under the signature of my predecessor the Hon. David Thomson. There is no question about the figures. The honourable member for Berowra will not deny them. The reason is that in Australia, there is very little incentive at all for private industry to invest in research and development. People in private industry have come to take it for granted that they simply buy their technology off the shelf. So many of our major companies in Australia are owned and controlled totally overseas. That constitutes a profound disincentive to developing indigenous technology and to looking for technology that is likely to have some export potential. That is a situation that we need to change.

There is one thing of which I have become increasingly convinced. It is that in Australia the primary problem of technology transfer is essentially domestic. In other words, as I said in my speech at the Conference, the psychological distance from the CSIRO or the Australian National University to Clayton or Fairfield seems far greater than the transfer from Detroit to Dandenong. Hoechst or IBM are only a telex or a phone call away from the leading edge of technology . In Australia managers and investors are often unaware of the technological and research capacity that surrounds them. We have an extraordinary situation in Australia: With 0.3 per cent of the world's population, we have produced 2 per cent of the world's scientific papers. So, proportionately we are doing very well. With one eighth of Japan's population we produce exactly the same number of Nobel Prize winners in science-four. We lodge 0.7 per cent of the world's patent applications, but we finish up with only 0.1 per cent of the world's high technology output. We have an impressive start but a dismal finish.

Mr Gayler —Seven years of it.

Mr BARRY JONES —Yes. This process began under the previous Government, which said: 'If business will not contribute, we will not do anything to induce it to do so. We will try to contribute an increasing proportion of R and D money'. That means in effect that whenever we write down R and D we ought to use a big ' R' and a little 'd'.

Dr Harry Edwards —Mr Deputy Speaker, I take a point of order. You will find in a moment that the Minister will be referring to the AIRDIS scheme and the Espie report-

Mr DEPUTY SPEAKER (Hon. Les Johnson) —Order! Does the honourable member have a point of order? He has not. There is a tendency for frivolous points of order to be taken. I suggest that honourable members should no longer countenance such a practice.

Mr BARRY JONES —One of the tragedies we face at the moment is that, while many of our high technology products have achieved almost instant recognition overseas and there is funding from overseas for them, when the product reaches the development stage that development process is aborted here and transferred somewhere else. In the Research School of Biological Sciences at the Australian National University, very close to where I am speaking now, 80 per cent of the funding comes from overseas industry. We cannot really blame the overseas interests, because they are more alert and more alive to the significance of what is being done here than we are.

Mr Simmons —They know that we have good researchers.

Mr BARRY JONES —Of course, they do. In Australia we lack Australian-based and Australian-owned pharmaceutical companies which are in a position to take advantage of that. One of the difficulties we may face is not that our sunrise industries will not be accorded some recognition in the world market-I am sure that they will be and that they will fill very important niches-but that it may not be possible in the early stages for us to fulfil the whole production process that would enable those products to be completely developed here. To take an example, it looks very likely that the Walter and Eliza Hall Institute of Medical Research in Melbourne will produce the first successful malarial vaccine. There is an enormous world-wide need to produce a malarial vaccine. Malaria is on the increase throughout the world. Hundreds of millions of people are at risk with malaria. If in six months time the World Health Organisation said 'That is terrific, we congratulate you on what you have done, but we want 10,000,000 shots of the vaccine by the end of June', we would be in the embarrassing position of saying: 'We are terribly sorry. We can produce it in the laboratory, but we do not have the technological capacity to express it in that quantity'. That is the point at which Hoffman-La Roche or Eli Lilly and Co. might say: 'We can do it; we have the technological capacity'.

Mr Groom —What are you doing about it?

Mr BARRY JONES —We are trying to involve industry itself--

Mr Groom —That is what your job is.

Mr BARRY JONES —That is right. We are trying to involve industry itself in working out its own salvation. It is extraordinary to reflect that at the beginning of the twentieth century we had a technological capacity which made us an exporter of pharmaceuticals. That is no longer the case. We have to ensure that government does not carry the whole burden of research and development in this country and that industry plays its part. My colleague Senator John Button, the Minister for Industry and Commerce, is responsible for what we might describe as traditional industry whereas I have responsibility for non- traditional industry, a dichotomy which I am sure the honourable member for Berowra recognises. But together we have worked very satisfactorily. Among the things that have happened in the last few months has been a complete restructuring of the Australian Industry Development Corporation with a significant increase in capital and an increase in the gearing ratio from 8 : 1 to 15 : 1. The Australian Industrial Research and Development Incentives Board has been revived significantly, and in the next week or two legislation will be brought in to bring about further changes. The report of the Espie High Technology and Financing Committee has been adopted by the Government and we expect that in the next week or two legislation will be set up to provide the capacity for tax deductions for high technology industries.

Mr DEPUTY SPEAKER (Hon. Les Johnson) — Order! The Minister's time has expired.