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Thursday, 27 March 1980
Page: 1094


Senator BUTTON (Victoria) -by leave- I move:

That the Senate take note of the paper.

I want to make some brief comments about the Australian Industrial Research and Development Incentives Board's annual report at this stage, not so much because of the contents of the report but because it touches on what I perceive as a very important issue- the current needs of this country and the general state of research and development in Australia. Not only bodies associated with research in education or in educational institutions- such as the Tertiary Education Commission- but also bodies such as the Organisation for Economic Co-operation and Development, have made comments about the state of research in Australia. It is interesting to observe the general pattern of research initiative in Australia and the general failure- one can only generalise about it because there are exceptions which would be noted- of Australian entrepreneurial skill and research conducted in private enterprise within the Australian manufacturing sector. The pattern of government involvement in research and development has been fairly consistent over a considerable period. One generally finds that Australian research scientists in industry tend to be employed by some major companies in periods of economic buoyancy but when the economy is not so buoyant the research activities of major companies are the ones which are cut back first.

I think that it is probably fair to say that over many years this was very much connected with Australian Tariff policy. I think whatever attitude we might have- on the respective sides of this chamber or generally- to the question of tariff policy, it is generally conceded that as a result of our policies over many years, industry has seen itself as not being under any obligation to carry on a number of activities when it can purchase applied research, or the consequences of applied research, from overseas. As I recall the figures, Australia still purchases something like $73m worth of overseas patents a year. The annual figure for exports of Australian design expertise and so on is something in the order of $ 1 m. An extraordinary imbalance exists between those two figures. I think a lot of that is due to overprotection of Australian industry and the feeling that new initiatives, designs, patterns and so on can always be obtained overseas. The point I make in connection with this report is that I think in this Parliament we should face up to the fact that those days are probably gone forever because of the operations of trans-national companies, particularly in their very significant impact in the Australian economy, and indeed on all economies, and also because there is not necessarily any desire or obligation on overseas researchers to provide the results of their research to Australian industries in the highly competitive situation in which they may be found.

I take the view that, if Australia is to make any contribution to its overseas trading position and to its trading relationships with the adjacent countries of South East Asia, which have rapidly developing economies, that contribution must be done very much on the basis of indigenous research effort in Australia. There is argument whether it should be done by Government research initiatives or by private industry. I think that the answer to that has to be that it ought to be done by both. This report of the Australian Industrial Research Development Incentives Board is really a collection of research projects which have been funded in relation to specific matters by this Board over a period; of course there have been previous reports of the same kind. I query whether these intitiatives are sufficient in the current context and in considering the future of Australian industry in the next 20 or 30 years. A lot is said in this place about technological change. The rate of technological change is enormously fast. The implications of that change for Australia are that if we are to develop new export industries which will not only provide employment opportunities but also provide additional wealth in terms of this country's development, a lot of those new industries will have to be developed on the basis of Australian research simply because in terms of comparative advantage Australia has a relatively high level of resources at this stage in terms of an educated and skilled community.

Stories which are legendary of Commonwealth Scientific and Industrial Research Organisation innovations disappearing overseas because there has not been the entrepreneurial skill or courage to take them up in the Australian manufacturing industry, I think, are well known to everybody. The record of failure of the Australian industry to take up many of the developments which CSIRO has made over a number of years is tragic. I only wanted to use this report, which goes to the heart of the problem of taxpayers' money being provided to Australian industry, to query whether the traditional system which has been adopted and about which this report is concerned has been adequate to encourage the level of research in private industry which we in fact will need in the remaining years of this century to handle the sorts of problems I have mentioned.

There are some classic examples of success. The former Minister for Productivity, Mr Macphee, I think is to be congratulated on the way some of those successes have been handled. One takes the simple example of InterScan, an Australian development which will not only create an export industry but will also employ something like 1,500 people, I think, for probably 30 or 40 years. Then one sees the sort of example of the capacity for success which we have in Australia if industry is properly organised and handled. I think that the whole question of research grants and incentives has to be very carefully looked at in terms of what are future viable industries rather than the sort of acrosstheboard approach which allows any industry that has some sort of research project to be equally treated. If we continue to adopt that across the board approach we might develop more of the total sameness and mediocrity when there are obvious areas of targeted research which are needed, particularly in the private sector. I seek leave to continue my remarks later.

Leave granted; debate adjourned.







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