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Economics References Committee
Australia's innovation system

GAUDIN, Professor Christophe, Deputy Director, Centre for Offshore Foundation Systems

ACTING CHAIR: We now reconvene our Senate Economics References Committee inquiry into Australia's innovation system. Welcome. Is there anything you wish to add about the capacity in which you appear today?

Prof. Gaudin : I am also a professor of geotechnical engineering at the University of Western Australia.

ACTING CHAIR: Thanks for appearing before the committee today. Would you like to make an opening statement?

Prof. Gaudin : Yes—maybe a few words to introduce myself, my area of expertise and the centre I am working for. As I said, I am a professor of geotechnical engineering and, more particularly, offshore geotechnical engineering. My area of expertise is the design of foundation and anchoring systems for offshore floating structures, mainly for the oil and gas sector but also for the offshore renewables sector.

I am the Deputy Director of the Centre for Offshore Foundation Systems, which is one of the largest centres in the world specialised in offshore geotechnical engineering and one of the best. We are but 100 people strong: 25 academics, 20 to 25 technical and administrative support and about 50 postgraduate students. Our budget is around $10 million a year, and half of that is coming directly from industry through different sources. We have a history and a legacy of strong interaction with industry and of impact towards the design of offshore foundation systems and, notably, the support of all the oil and gas developments in the North West Shelf but also projects in the Gulf of Mexico, West Africa and so on.

My statement is a personal statement based on my own experience. Obviously oil and gas and energy in general have been a national priority for the Australian government for quite a while. In that respect, I feel extremely privileged to be working in that sector as we have been benefiting from a lot of support from the federal and state governments and also from industry through different mechanisms. So my experience does not necessarily reflect the overall research area within the university.

When it comes to innovation—maybe during the discussion we can talk in more detail about the experience of our centres—I believe that universities are in general important vectors of dissemination of knowledge and support of innovation. What is important to acknowledge is that it is done through many different pathways which are both direct and indirect. Working myself in research which is not really applied research, we use more of these direct pathways where the research we are doing can be translated within a short time frame to the industry for direct application and innovation. But in general universities impact on innovation through many different pathways, and some of them are not necessarily tangible or within a time frame which can be easily evaluated. Some of them relate basically to the public good that the innovator is producing and the advancement of general knowledge, which may take time to translate into specific applications, but also in the education of highly qualified postgraduates who have been exposed to the most recent developments in their respective fields and who eventually go to industry to support innovation.

Another aspect of innovation which I think is extremely important in our field is the development of large infrastructures, especially experimental infrastructures, which needs government support. By this specific mechanism, we have been able to connect with industry and to support specific innovation, and that is something that we may want to discuss in a bit more detail as well.

I think that summarises my statement. I have other aspects to cover, but hopefully we will go through those in the discussion.

ACTING CHAIR: Thank you very much.

Senator KIM CARR: Thank you very much, Professor. Your website details that you have a range of industry partners. If you have the time, I was wondering if you could, on notice, provide us with advice on how a couple of those partnerships have developed and how they have been sustained. What have you had to do to make them work, and what lessons has the centre learnt along the way? Could you take that on notice.

Prof. Gaudin : Yes, absolutely. I think it is quite an important and relevant question as well, because, if you can look at the different partners we have, we have very well established partners like Woodside, Exxon, Chevron and so on—large oil and gas companies—and so these relationships are developed essentially through consulting and advice that we are giving and through specific services associated with the experimental facilities that we have. They are based essentially off direct industry funding. Through our relationships that we establish with these partners and a culture of trust that we nurture along the years, we are able to attract direct funding which enables us to develop specific research projects.

It is quite interesting to understand that this is totally different to the kind of relationship that we can build with other partners of lesser size, like Carnegie Wave Energy for instance, which is a company based in Fremantle and which I believe is a world leader in wave energy converters. Obviously this is a company of much lesser size without much capital, and the relationships we are building with these types of facilities rely a lot on government support and specifically funding from the Australian Research Council. So at the base the relationship is the same, in the sense that you need to establish connections with these people—and this is done, again, by the consulting services that we are providing and by the specific services we provide through our experimental facilities. But the mechanism enabling these research projects to be undertaken and the outcome to be disseminated are totally different between large industry and small industry.

Senator KIM CARR: If you could detail that it would be great. Also I notice that you have extensive international partnerships. Could you explain how you have developed those and what you have had to do to keep them working?

Prof. Gaudin : This is essentially based on reputation. The Centre for Offshore Foundation Systems is highly regarded around the world, and this is something which takes time to build. It is done through the impact of our publications, lectures that we are doing and conferences, but also relationships that we are building by welcoming overseas researchers and by ours, as well, going on sabbatical to other places. So it is engaging in networking activities and demonstrating the impact we have from publications, but also success in funding mechanisms and relationships with industry is essential to raise our profile and make sure that we strengthen these collaborations.

Senator KIM CARR: You have been a centre of excellence now for how long?

Prof. Gaudin : It is going to be six years, and we are applying at the moment for the next round.

Senator KIM CARR: I am familiar with the centres of excellence program, so I am interested to know how you think the centres of excellence program through the ARC could be improved.

Prof. Gaudin : It is actually quite a good program, I believe, because one of the issues we are struggling with as researchers is the short-term policies that are established. All the funding schemes are usually on a lesser time frame.

Senator KIM CARR: It is a highly competitive program.

Prof. Gaudin : It is indeed.

Senator KIM CARR: You are rated against your competitors. So I take it that you have done quite well to receive funding for six years. You say you are seeking funding for another round.

Prof. Gaudin : Yes, for another round of seven years. There is a lot of emphasis on impact and relationships with industry, which we have, and on national benefits, engagement with other universities in Australia and so on. Can it be improved? I do not have a definite answer immediately. I think the—

Senator KIM CARR: If you want to think about that, let us know. We would be delighted to hear from you. Going to the more general question about the way in which Australian business works with the university, in your direct experience what can be done to improve that relationship?

Prof. Gaudin : Industry works with us in particular because of, first, our high reputation—

Senator KIM CARR: Reputation for excellence.

Prof. Gaudin : Correct. Second is the fact that we are all consulting at different levels, so the industry has a clear understanding about what we can provide. Third—and it is probably the most important—is the experimental facilities and infrastructure we have, funded partly by state government and federal government, which enable us to provide services and support the industry and to provide access for industry to expertise that they cannot nurture themselves or—

Senator KIM CARR: That they cannot get hold of—is proof of concept one of the key functions?

Prof. Gaudin : Yes, we do a lot of proof of concept but we also assist in design quite regularly. A typical example we advertise is that most of the pipeline in the North West Shelf has been designed in our centrifuge facility through specific testing that we have developed in collaboration with industry and the results of which are directly used for the design. That is one example.

Senator KIM CARR: Is there anything that can be done to improve that relationship?

Prof. Gaudin : Absolutely. There are two aspects. When it comes to direct funding with industry there is a—academics' performance is evaluated through publications. When you deal with industry it is an issue because the industry typically is extremely concerned about the protection of its IP. So we end up with this kind of paradox where we want to publish our research because it is important for our own development but industry want to protect their interests.

Senator KIM CARR: They want to keep it secret.

Prof. Gaudin : Exactly. So, there is a need—especially for the early-career researcher who is trying to make a career for themselves—in the evaluation of the performance of the academics to include more of the impact they have in their research through the interaction with industry. When it comes to the relationship I described with Carnegie Wave Energy as an example, where we rely a lot on funding from the Australian Research Council, we use what is called the Linkage Projects. One of the issues with this kind of funding is the time frame between the time of the submission and the time of the funding. It is definitely too slow for most of industry, which needs a much faster turnaround and which basically needs the research to be undertaken as soon as the idea arrives.

Senator KIM CARR: The trouble is, Professor, that public money requires public accountability.

Prof. Gaudin : I am perfectly aware of that.

Senator KIM CARR: There needs to be a different set of criteria from the interests of an individual company. How do you think you can reconcile those two conflicting demands?

Prof. Gaudin : It is not so much about the accountability and the set of criteria; it is about the time frame.

Senator KIM CARR: But the time frame is determined—for instance, the ARC Centres of Excellence core funding is determined on a competitive basis. So, you need to have a look at your competitors; it cannot be a quick tick and flick. If you are looking at the ARC Linkage Projects, again it is on a competitive basis. You may well have criticisms of how adequate that is, but it is nonetheless a requirement when you are dealing with public money.

Prof. Gaudin : Again, I think the scheme is adequate. I know it quite well because I both submit applications and review applications, and I see the time frame—

Senator KIM CARR: For both, yes. How can we speed that up without undermining public accountability?

Prof. Gaudin : Maybe in shortening the review process, for example. That can be done if the work in reviewing applications is directly accounted for when it comes to academic performance evaluation.

Senator KIM CARR: But that is still dependent on peer review, isn't it?

Prof. Gaudin : Correct.

Senator KIM CARR: So, how are you going to get your colleagues to work faster?

Prof. Gaudin : If it is an activity which is acknowledged in their performance evaluation and in their portfolio of activities, it is probably easier for people to engage in it. I do mine very quickly because I feel that this is my duty and responsibility as an academic. But from the university perspective, the university does not care if I do a review or not.

Senator KIM CARR: That is true, but my recollection of those panels is that you have to have appropriately qualified people. Are there enough panels? Are there things we could do to speed up the process by administrative arrangements?

Prof. Gaudin : I do not have enough insight into the process. I am just acting as a reviewer. I do not sit in the ARC College of Experts.

Senator KIM CARR: I would be interested if you could reflect on that—

Prof. Gaudin : Absolutely.

Senator KIM CARR: —because if we do not get those administrative arrangements right it can actually be highly counterproductive.

Prof. Gaudin : One other option, if it cannot be shortened, is to have two rounds a year instead of having one round a year, which would give a bit more flexibility. Basically, there is—

Senator KIM CARR: A rolling process?

Prof. Gaudin : Yes, and more opportunities for engagement in the industry.

Senator KIM CARR: That is fair enough. Is there an issue here with regard to whether there are other funding mechanisms like the R&D tax concession or incentive for payments? Do you think that that might be a more effective way of encouraging collaboration?

Prof. Gaudin : I am sure that from an industry perspective it is an encouraging thing. As an Australian citizen, if there are tax exemptions there is basically less tax for universities to operate as well.

Senator KIM CARR: That is true.

Prof. Gaudin : There is a nice balance to find.

Senator KIM CARR: There is. There is definitely a compromise there because if the revenue base of the Commonwealth is reduced there is less available for other things.

Prof. Gaudin : Absolutely. I think it also depends on the size of the industry and how innovative they are perceived to be. There is a difference between tax exemptions given to Woodside and tax exemptions given to Carnegie Wave Energy, for instance, which works in a very innovative and competitive field, in a sense.

Senator KIM CARR: A number of the submissions we have received have pointed to the need to improve mobility between researchers and companies. Do you think there is something that we could do on that front?

Prof. Gaudin : Again, from our own perspective, I think we are doing extremely well on that. There are mechanisms to enable secondment of academics to industry and we take advantage of that. What may be missing is a mechanism that enables industry people to come and work at the university to strengthen the engagement and for them to understand a bit more how a university works.

Senator KIM CARR: That is not a bad point. You are experienced with European universities. We have clear evidence that there are many, many more PhDs working in industry in Europe than there are in Australia. Do you have any explanation for why that is?

Prof. Gaudin : It is interesting because this is not the experience I have from France, where I come from. The divide between universities and industry in France is much broader than it is here. I was surprised when I arrived in Australia to see how easy it was to engage with industry. I have limited experience with other European countries.

Senator KIM CARR: Then let's take France. What do they do in France that encourages more PhD qualified people to work directly in industry rather than—

Prof. Gaudin : They do not do anything because a PhD is not a recognised degree when it comes to working in industry. The French system is dual. You have the university stream where people do different degrees and go on to a PhD. These people are basically going to engage in research only. Then you have the civil stream of university education which trains the people who are going to work within—

Senator KIM CARR: So the French industrial PhD does not have the same value?

Prof. Gaudin : No.

Senator KIM CARR: So perhaps the answer is that we have to have a second stream.

Prof. Gaudin : Not necessarily.

Senator KIM CARR: That might buy us a few interesting conversations.

Prof. Gaudin : I do not think France is an example to follow.

Senator KIM CARR: Oh, right!

Prof. Gaudin : That is why I am here and not in France!

Senator KIM CARR: Fair enough. Your centre does, nonetheless, focus on fundamental research.

Prof. Gaudin : No, that is not true. We do a lot of fundamental research. I think the success of our centre is based on this very robust mechanism we have where we do fundamental research which is translated into applied research and disseminated to industry through the different services we provide. From these services and this engagement with industry we get feedback that feeds our fundamental research. It is about engaging in that cycle. That means we can be successful. Even in our fields which seem to be externally applied the importance of fundamental research should not be underestimated.

Senator KIM CARR: One of the arguments, though, about the relationship between basic research and applied research and commercialisation is that you cannot have any commercialisation without the creation of new knowledge.

Prof. Gaudin : Absolutely.

Senator KIM CARR: Are you a supporter of maintaining the basic research program?

Prof. Gaudin : Absolutely. A lot of breakthroughs are based on ideas that were established before we had any clue about the returns. An example is the internet. The internet was developed in the 1960s by two people who had no clue about what the World Wide Web would be 30 years later.

Senator KIM CARR: That is right, and that had a very large sum of government money put into it.

Prof. Gaudin : Yes.

Senator KIM CARR: I want to turn to the question of the role of design and design thinking in the work that you do. How significant is that?

Prof. Gaudin : It is quite significant. The nature of our activity is essentially based on design. When I say that we do fundamental research which we then translate into applied research, this applied research is providing recommendations on design guidelines for the industry and we assist them with the implementation of these guidelines.

Senator KIM CARR: What is the role of the humanities and social sciences in your work?

Prof. Gaudin : The role of humanities is quite important to get an answer from the public and the community—

Senator KIM CARR: So a social licence?

Prof. Gaudin : Yes.

Senator KIM CARR: Finally, are you familiar with how much money the Chinese or northern Asia more generally are spending on global research?

Prof. Gaudin : It is about 10 times what Australia is spending. As a ratio of population and the overall Chinese economy it is actually less, but—

Senator KIM CARR: The aggregate amount—

Prof. Gaudin : Yes, it is extremely significant. When it comes to offshore engineering, China, Singapore and a lot of these emerging countries are providing a lot of what is going to grow the economy and the future of energy in terms of food, freshwater and so on.

Senator KIM CARR: In this shift from Europe and the United States to northern Asia, are there opportunities for Australia?

Prof. Gaudin : Absolutely.

Senator KIM CARR: Or are there are risks?

Prof. Gaudin : We are engaged with several Chinese universities. At the moment we are developing a program with China's academy of science. We have a lot of programs in place. So there are definitely going to be opportunities because we have an expertise that China does not have yet. They have the people but they do not have the expertise yet.

Senator KIM CARR: What about the risks? It was not so long ago that people would not necessarily think too much about working in China for all sorts of reasons but particularly because of conditions and facilities. Is it the case now that the same applies? Or is the research community in China actually being well rewarded and well resourced?

Prof. Gaudin : Absolutely.

Senator KIM CARR: So are the Chinese universities and research agencies now directly competing for talent with countries like Australia?

Prof. Gaudin : Not at the moment. I can say that clearly because, for instance, we attract the best Chinese students for postgraduate programs at UWA and most of the time they do not want to go back to China. They want to stay here in Australia and keep working.

Senator KIM CARR: That is true.

Prof. Gaudin : So it is not the case at the moment, but that may change completely in 10 years time.

Senator KIM CARR: I am thinking about their oceanography research. Their polar research is—

Prof. Gaudin : Yes, absolutely. Again, they have capital and opportunities that can be very attractive in the medium term to academics worldwide.

Senator KIM CARR: Thank you very much. That was much appreciated.

ACTING CHAIR: Yes, thank you. We thank you for coming and giving us that insight into your experience in the innovation area.

Proceedings susp ended from 14:12 to 14:32