Australian Innovation System Report 2010. (April 20, 2010)

Yesterday the Minister for Innovation, Industry, Science and Research, Senator Kim Carr, released the 2010 Australian Innovation Systems Report, which is the first volume of a series intended to be published annually.

According to the media release the report outlines:

• metrics and baseline indicators which compare Australia’s innovation performance to other OECD countries and tracks progress against the Government’s innovation priorities and targets  –  these metrics are presented under the four policy themes identified in Powering Ideas: skills and research capacity, business innovation, links and collaboration and public sector innovation;
   

• features and trends of the Australian innovation system and performance as a whole, including Australia’s performance on Gross Expenditure on Research and Development (GERD), investment in knowledge, proportion of innovating businesses, collaboration and networking, skills used and shortages and trends in Multi-Factor Productivity (MFP) growth; and
   

• actions, achievements, and forward plans of various participants in the national innovation system, including governments, public sector researchers, and industry.

In launching the report in Melbourne at "Collaborating for Success", the inaugural conference for innovation advisory bodies Senator Carr noted that a 1998-99 BERD low of  0.67% of GDP has lifted to 1.27% of GDP by 2007-08, and went on to say:

Putting money into research and development will lift Australia’s productivity and create new high-skilled jobs, [and] while the increase in private sector R&D spending is pleasing to see, much more work remains to be done by both industry and government.

In the last Budget, the Government allocated $8.6 billion for science and innovation. This is an investment in our future. Innovation, education, infrastructure and regulatory reform are the four pillars of the Government’s productivity agenda.

If Australia’s productivity is to grow, we need to make sure that all stakeholders – industry, the research workforce, the community and governments – are working together. This includes working closely with our international partners so Australia can benefit from the vast amounts of knowledge created offshore.

The senator also alluded to the finding that the country is ranked 15^th in public spending on tertiary education and only spends 0.054% of its GDP on early stage venture capital: "We need to get much better at attracting, developing and retaining talent. We have a disproportionate number of small firms, which often find it difficult to identify and apply best practice.

"We still trail the pacesetters on several important measures, including business expenditure on R&D, the proportion of firms engaged in innovation and the level of collaboration between public researchers and private industry."

A defining aspect of the report refers to: Investment in Knowledge which it defines: "as the sum of expenditure on R&D, on higher education from both public and private sources, and on software," And goes on to explain that it is "a broad indicator of a country’s progress in building innovation capacity; it tells us not only about technology creation and diffusion, but also about absorptive capacity and skills."

This is by way of developing the background for this chart:

The conundrum, however, is just where Senator Carr's fine words and apparent  forward looking intentions get us when juxtaposed to Treasurer Swan's ominous prognostications of a straight-jacketing federal budget, and the Senator's penchant for micromanaging the higher education sector.

“Faire words butter noe parsnips”