Aust business wants a bigger say on new industry strategy

Joseph Brookes
Senior Reporter

Australian businesses have demanded a larger role in a new Australian innovation plan after years of inconsistent and ineffective industry policies which have seen Australia fall behind the “global technology frontier”.

The Committee for Economic Development of Australia (CEDA) will on Thursday launch a report warning of the dire state of Australian innovation and industry development, saying short-sighted and misaligned federal policy deserves much of the blame.

Ahead of CEDA’s annual event in Parliament on Thursday, the paper calls for an overhaul of industry policy with greater ambition and imagination for the nation.

It says this should be driven by better alignment of business, academia and government.

“Underpinning this desire is a recognition that many of our businesses are slipping further from the global tech­nology frontier and that the sophistication of Australia’s industries and economy is declining,” the paper said.

Canberra Cartherics bridge
CEDA wants more ambitious industry policy to capitalise on science and technology opportunities

The economic thinktank backed by Australia’s biggest businesses, lays blame for Australia’s poor performance mostly at a lack of long-term ambition and planning at the federal level, marked by dives in R&D investment, falling university funding and worsening economic complexity and manufacturing self-sufficiency.

“The average time between publishing academic research and its effects on productivity growth in the relevant industry is roughly 20 years. In the past 20 years Australia has had eight elec­tions, seven prime ministers and three changes of government,” the report said.

“There have been nine ministers responsible for innovation in the past nine years. The average lifespan of a federal R&D funding program under $1 million is just six years. The policy approaches and commitments to innovation in other countries are far more stable and consistent.”

In contrast, the main US business innovation program has “survived seven presidential administra­tions largely unchanged”. Australia’s economy being largely made up of small businesses means the US program is an “eminently replicable formula”.

CEDA developed the paper, titled Harnessing Science x Technology to Drive Australian Innovation and Growth, based on series of 2022 workshops and one-on-one discussions with leaders from Aus­tralian industry, government and academia.

It says the new industry policy should be accompanied with a “turbo-charged focus” on the training and skills of the population and a sus­tained lift in collaboration between the members of the innovation ecosystem.

Prime Minister Anthony Albanese says the new federal Labor government has handed Ed Husic the Industry and Science portfolios with this ambition in mind.

Labor has committed to boosting R&D spending back to globally competitive levels, while Mr Husic has acknowledged the current fragmented innovation system is partly a symptom of similarly disjointed industry policy and that the government should be less dogmatic on picking winners and cooperative with the research sector.

CEDA chief executive Melinda Cilento said a better plan is needed.

“Without an industry strategy to drive our innovation and technology focus, our capabilities as a nation will not be fully realised,” she said.

Coming out of the pandemic and with greater recognition of the potential of Australian innovation, there is a common desire to leverage science and technology as drivers of prosperity, Ms Colento said.

“We will work with stakeholders to identify the critical elements of a pragmatic, practical and targeted-industry strategy that takes a coordinated approach to building capabilities at scale.”

Do you know more? Contact James Riley via Email.

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