Innovation Review Released

6 Oct 08

The report of the Review of the National Innovation System, has been released, and contains a warning about the consequences of inaction, as well as a blueprint for change.

"When it comes to innovation, Australia is stalling, not sprinting ahead," said Dr Cutler, author of the report, entitled Venturous Australia.

"The architecture of Australia's existing national innovation system is now a generation old and requires an urgent re-appraisal and re-structuring.

"Our understanding of innovation has changed and our approach to innovation and our innovation policies must change accordingly.

"Today, innovation is more than just research and development and technology. It is also about improving the capacity of firms to modify technologies and services in response to customer demand.

"Having a competitive economy depends upon the capacity of businesses to embrace innovation and use it to capitalise on new markets and to satisfy changing customer demands," he continued.

"The challenge for Australia is to take stock and seize the opportunity to rejuvenate and re-invigorate our innovation system - if we do not, we risk a decline in our national prosperity.

The report has 72 recommendations that range across the components of an effective system, focusing on innovation in business, strengthening people and skills, excellence in national research, information and market design, and taxation.

Key recommendations include:

• Simplify and expand the tax sweeteners for business by replacing the current R&D tax concessions with a more generous two-tier system of tax credits.
• Provide tax breaks for all R&D conducted in Australia, regardless of where the intellectual property is held, opening up government support to more multinationals.
• Fully fund research at universities so they no longer have to rely on funding from overseas fee-paying students to prop up the money from competitive grants schemes.
• Build on national research strengths, for example agriculture and climate change in the public sector, and resource and space industries in the private sector.

The report is available from the Department of Innovation, Industry, Science and Research's website here.

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