Navigating Australia’s research landscape reveals a system with curious blind spots, particularly concerning the types of discoveries it tends to neglect. This often tells us more about the system’s inherent biases than its successes.
A World-First Biological Computer and the Funding Hurdle
In a rather unassuming office park located in Melbourne’s northern suburbs, a groundbreaking development emerged from Cortical Labs: a world-first biological computer. This innovation ingeniously wove human neurons with silicon, a feat that pushes the boundaries of what we consider technology.
However, the journey from concept to reality was heavily reliant on private funding. Chief Scientific Officer Brett Kagan candidly explains the challenges, stating, “We would never have got a [government] grant to do the research we did. Research in Australia is incredibly conservative. Funding goes to small conservative iterations that fit within the status quo.” Kagan’s experience is far from isolated, highlighting a systemic issue within Australia’s research and development sector.
A Scathing Review of the R&D System
The implications of this funding scarcity are underscored by a comprehensive government-wide review of Australia’s research and development system. Released recently, the report paints a stark picture of a system that has become bloated, inefficient, and is incentivised to project an image of world-class knowledge creation while struggling to produce tangible, life-changing discoveries.
The report poses a perplexing question: how can a nation that produces a significant percentage of the world’s top research papers (4.4 per cent) still maintain an economy so heavily reliant on resource extraction, classifying it as one of the least complex economies globally?
The review doesn’t hold back, labelling the R&D system as “an underperforming system that is the result of often trifling, incremental improvements, risk-aversion and band-aid solutions.” This assessment is a harsh indictment of a system that, despite housing extraordinary scientific talent within its university laboratories, becomes increasingly irrational the further one zooms out to observe its overarching structure.
The Grind of Grant Applications and the Pressure to Publish
Australian scientists often find themselves dedicating a substantial portion of their working year to the arduous task of writing grant applications. The overwhelming majority of these applications are ultimately unsuccessful, leading to immense frustration and wasted effort. The remaining time is frequently consumed by the pressure to publish as many papers as possible, a metric often used to gauge productivity within the scientific community. This emphasis on quantity over quality can stifle genuine innovation and lead to a decline in scientific inventiveness.
Universities: Rankings Over Research
While Australian universities often proclaim a focus on world-class research, this narrative isn’t entirely accurate. Their primary objective appears to be climbing global university rankings. This pursuit is driven by the need to attract more international students who pay substantial fees, which in turn fund further research and, critically, help to boost those rankings.
Dr. Cathy Foley, former Chief Scientist and now President of the Australian Academy of Technological Sciences and Engineering, describes the system as “bizarre.”
International Collaboration vs. Local Neglect
Consider the case of Genesis Algae Innovation, a Queensland-based company that exports animal algae supplements. These products claim to reduce methane emissions and enhance growth. The company has established a significant research program in China, a move necessitated by local universities stating that setting up a similar program in Australia would require years of substantial financial investment.
“It’s good for us, but terrible for Australia,” laments founder Colin McGregor. “A lot of universities appear to have changed their focus from research to being a churn factory for students.” This scenario exemplifies how Australian innovation can be hampered by a lack of local support and infrastructure.
Government Funding: A Bureaucratic Labyrinth
The federal government’s approach to research funding is also under scrutiny. A pervasive fear of being perceived as “picking winners” has led to a complex, almost Kafkaesque bureaucracy. Taxpayer funding is channelled into a bewildering array of over 150 separate government R&D funding streams, with hundreds more managed at the state level.
“It does not need to be that way,” argues Dr. Foley. “The problem is, research is horizontal across all government departments, and so therefore every government department wants to control its own budget.” This fragmentation creates an enormous administrative burden.
The sheer complexity of navigating this system means many companies are forced to hire external consultants, who often take a substantial cut – more than 10 per cent of the grant – as a success fee. For startups, this adds another layer of difficulty. “It’s quite difficult to justify exploring those opportunities,” says Kagan. “Most startups die doing it.” Cortical Labs, for instance, has received a modest $315,000 in funding across two innovation support government grants, a testament to the challenges faced.
Proposed Solutions for a Revitalised System
The recent review proposes a wholesale transformation of the research and development system. At the apex of this proposed new structure would be a National Innovation Council, tasked with overseeing six key pillars of research focus. The report advocates for consolidating most government research funding and directing it towards these priority areas.
Furthermore, universities should be empowered to specialise. The current legislation mandates that they conduct high-quality research across half the areas they teach. The review suggests scrapping this requirement, allowing universities to concentrate their efforts on a select few areas where they can excel.
The underlying principle is straightforward: encourage bolder, more impactful initiatives, akin to “Manhattan Projects,” with reduced bureaucracy.
This approach challenges the long-held economic theory that prioritises market-driven innovation. However, the review cites influential modelling from 2023 that suggests strategic “picking winners” can indeed outperform the market in the long term, provided there’s an acceptance that some chosen initiatives will inevitably fail.
The Question of Implementation and the Cost of Neglect
While significant improvements can be made without additional funding, substantially greater progress could be achieved with increased government investment. Minister for Science Tim Ayres’ response to the report has been somewhat mixed. While acknowledging a blueprint for “decadal reform,” he also indicated a need for further “public discussion” with researchers and industry before deciding on implementation. The 471 public submissions to the review suggest that extensive consultation has already occurred.
For those who have observed Australia’s science funding trends over time, the decline is not an anomaly but a consistent feature of the system. In the 1980s, Australia’s emphasis on innovation led to robust productivity growth, a key driver of economic prosperity. By 2008, a government review already indicated a downturn in both research spending and productivity growth.
This downward trend has persisted, with Australia falling increasingly behind other nations in research expenditure each year. This decline is directly correlated with a near halving of future economic growth projections, a stark reminder that investment in science is not a cost but a crucial investment in the nation’s future.
Arresting this decline, while requiring investment, is not prohibitively expensive. To match the average research spend of competitor nations, the government would need to allocate an additional $1.8 billion annually. For perspective, fuel subsidies alone cost the budget approximately $10 billion per year.
The critical question remains: can Minister Ayres secure this vital funding amidst rising inflation and government efforts to find budget savings? The future of Australian innovation hangs in the balance.
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