Economy

Full scale innovation policy review under way

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Terry Cutler, the head of the panel conducting a wide ranging review into a national innovation system, has denied there is a conflict within the Labor Government on policy direction.

Yesterday the Minister for Innovation, Industry, Science and Research, Kim Carr, announced that Cutler, a CSIRO board member, is heading the review, which is required to produce a green paper by July with the Government to respond by the end of the year, in time for the 2009 budget in May.

Cutler says the panel will be taking a 10-year view. “Where is Australia heading? We see that as part of the terms of reference, articulating that in our priorities to set the sign posts. An important part of the review is to look at the mishmash of programs and really focus those against national priorities and future challenges.”

One of the reasons for the review of programs, such as R&D research funding, CSIRO funding, and the COMET scheme, is to get rid of the duplication between states and the Federal Government and to make it easier for business to work with government.

Last week, it appeared Small Business Minister Craig Emerson and Innovation Minister Carr conflicted on approaches to setting up an innovation system.

Emerson, an economist, wrote a piece that was applauded by The Australian Financial Review, stating that business just wants government to get out of the way and the right response is “not to contemplate new forms of taxpayer-funded largess that governments can bestow”.

Carr, on the other hand, is taking a different approach. He wants to map the innovation system, plug the gaps and build national capabilities, Cutler says.

However Cutler says the two views are not inconsistent. “There are a lot of areas where it is appropriate to say the system is working really well; let’s just get out of the way.” But he says there are areas where the market is not working.

“We have got to keep making the point that the challenges are too big and the reality is that other countries are not sitting back and letting market forces work. They are plugging gaps and building national capabilities and setting a direction.”

He says that while some programs this year will not be affected, others will. There is another round of applications for Cooperative Research Centres (CRCs) scheduled. That will be put on hold, he says.

He says that one of the big challenges for a CRC is that it is too hard for business to take on the longer term financial commitments when entering into a relationship with a CRC.

“We need to look at how we can get smaller companies to draw on and benefit from research being done not only in CRCs but in universities and other public research organisations.”

He will also be making sure that Australia plugs into the innovation systems around the world. “We want to appoint leading international experts to the panel and draw on their perspective,” he says.

He adds that there are a number of people on the panel who have a good understanding of small business issues including Catherine Livingstone, former managing director of Cochlear and Australian Business Foundation CEO Narelle Kennedy.

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