Review of the research and development system in Australia
Review of the research and development system in Australia
Overview
The Australian Government has initiated a strategic examination of the nation's research and development (R&D) system. This review aims to strengthen the alignment of R&D activities with government priorities and improve overall outcomes. The examination is part of the government's broader plan for a ‘Future Made in Australia’, which includes achieving net zero emissions, developing critical technologies, and building sovereign capability.
Panel members
The review is being led by a panel of four eminent Australians, each bringing a wealth of experience and expertise in their respective fields:
- Robyn Denholm (Chair): Chair of Tesla, with extensive experience in R&D through senior leadership roles at some of the most innovative companies globally
- Emeritus Professor Ian Chubb AC: Former Vice Chancellor of the Australian National University, former Chief Scientist, and current Chair of the Health and Medical Advisory Group
- Professor Fiona Wood AO: Former Australian of the Year, pioneer of the ‘Recell’ spray-on skin, Director of the Royal Perth Hospital Burns Unit, and Winthrop Professor in the School of Surgery at the University of Western Australia
- Dr Kate Cornick: Chief Executive Officer (CEO) of LaunchVic, Non-Executive Director at the Victorian Government Innovation Panel and the Australian Information Industry Association, and former CEO of ASX-listed Rision Ltd.
Remit of the review
The panel has been tasked with assessing the benefits to economic growth and productivity from a more purposeful approach to R&D. Specifically, they will consider opportunities to:
- Maximise the value of existing investment in R&D
- Strengthen linkages between research and industry
- Support the achievement of national priorities
- Drive greater R&D investment
- Uplift Australia’s overall R&D intensity.
Our commentary
BDO agrees with the intent of the review to increase Business Expenditure on Research and Development (BERD), aligning with our insights from the ‘Towards 3% R&D: Solving our Innovation Struggle’ report.
However, we have concerns with the intent to align R&D activities with government priorities. While the review terms suggest that it will look at the broader R&D system, further commentary in the media suggests it will involve a closer look at the R&D Tax Incentive.
We believe the R&D Tax Incentive is generally working as intended and would be very concerned if there was any move away from the industry agnostic nature of the program. R&D tax incentives have become the leading mechanism for supporting R&D by Organisation for Economic Cooperation and Development (OECD) countries.
There is ample evidence that R&D tax incentives create spillover benefits for the greater economy and provide a positive return on investment. In Australia, the R&D Tax Incentive is the key mechanism to support R&D intensity. It is also a key mechanism for encouraging globally mobile companies to conduct R&D in Australia in the face of competition by other OECD nations.
BDO looks forward to contributing to this review and providing insights that will help shape the R&D tax incentives that have become the leading mechanism of future of Australia's R&D landscape. Our extensive experience in advising businesses on R&D tax incentives and innovation strategies positions us well to offer valuable perspectives. We are committed to supporting our clients in navigating the complexities of the R&D system and maximising their investment in innovation. We also encourage our clients to share their experiences and insights with us, ensuring their voices are heard as part of this review.
How BDO can help
For further assistance on this topic, please contact our experts at BDO who can provide guidance on navigating the R&D landscape in Australia. Our team is ready to help businesses leverage the opportunities presented by this review and ensure they remain at the forefront of innovation.