February 12, 2025
Lifting investment in research and development (R&D) is essential for Australia's long term economic prosperity, security and wellbeing.
The Government's strategic examination of research and development (SERD) is a critical initiative to unlock Australia's innovative and productive capacity and drive economic growth. The SERD discussion paper crucially recognises that R&D is essential to lifting productivity and underwriting national prosperity. Increasing investment in R&D must be a national priority.
At the core of these issues is the stark reality – acknowledged by the discussion paper – that Australia lags the OECD average in terms of R&D intensity at around 1.7 per cent of GDP. The OECD average is around 2.7 per cent of GDP, a full 1 percentage point higher and the gap is widening.
As part of this decline, investment in R&D by business and government has plummeted and universities - in particular, our research-intensive universities - have picked up the slack. The Go8 alone are not only responsible for 70 per cent of research undertaken by universities, but also over 20 per cent of national research expenditure. This is all part of a trend that has seen research investment by the higher education sector steadily increase from 0.40 per cent of GDP in 2000, to 0.61 per cent of GDP.
These are not new issues, and the Go8 has laid out a roadmap towards a 3 percent of GDP target, including the need for a bipartisan National Research Strategy to grow R&D and build a more resilient and dynamic economy, in its publication Australia's R&D Intensity: A Decadal Roadmap to 3% of GDP. This will be central to the Go8 discussions with the SERD panel.
The Go8 is committed to working closely with expert review panel to develop a research system that delivers Australia the capability to meet complex policy challenges and set the nation up for a prosperous future.
Quotes attributable to Group of Eight Chief Executive Vicki Thomson:
"While this review is important and we welcome it, we don't need yet another lengthy process to tell us that both business and government investment in R&D has continued to decline whilst higher education investment has increased.
"Successive reviews over recent decades have failed to deliver what Australia needs to fulfill its economic potential. Not since Backing Australia's Ability in 2001 have we seen long term, visionary industry/university policy.
"Now is the time for bold economic leadership to maximise our future prosperity, to ensure that we can realise and achieve economic opportunities and meet the challenges we face as a nation. We need a fit for the 21st century national research and industry strategy that includes bipartisan, long-term support for basic (fundamental) research in Australia, provides full economic cost support for government research grants to universities, and addresses the university sector's reliance on international student fee revenue to fully fund research.
"To accomplish this, we must collaborate across government, business and universities to implement the long-term structural reforms that will unleash Australia's world leading research university sector and empower business to greatly increase R&D activity.
