Increasing R & D investment promising, but long-term plan and further investment critical for prosperity

16 February 2024

The Australian Academy of Technological Sciences and Engineering (ATSE) welcomes the increase of 2.7% in research and development (R&D) funding, compared to last year – worth $328 million.

The increase shown in the latest Science, Research and Innovation budget tables represents the first real pause in the long downward trend of declining federal R&D funding.

However, far greater investment will be critical for Australia to be competitive with its international peers and to avoid becoming an innovation laggard.

As stated in ATSE’s pre-budget submission, Australia’s future economic security depends on moving research investment into line with major R&D nations like the United States, Japan and Germany, who all spend around 3% of their GDP on creating and applying new knowledge.

Australia currently spends around 1.68% of GDP on this innovation endeavour. We cannot afford to be dependent on other nations for the critical research and innovation that underpins our approaches to health, defence, clean energy and other critical sectors and community needs. Australian research and development can and should meet Australian needs.

ATSE estimates that increasing R&D investment to 3% of GDP – with leadership from the federal government – could lead to an additional $133 billion in the Australian economy. Our analysis shows that this is attainable if the Australian Government invests an additional $2 billion annually, with industry sectors increasing their investment proportionally.

Australia’s research and development system is fragmented and spread over 176 programs and 14 federal portfolios. We urgently call for a long-term strategy which positions science, technology and innovation underpinned by excellent Australian research, for what it is – a fundamental driver of economic prosperity, health, sustainability and well-being.

The Academy stands ready to support and collaborate with government and industry to inform a roadmap which will help Australia to remain an innovation nation on the global stage.

This statement can be attributed to ATSE CEO Kylie Walker