Bernie Ripoll (Oxley, Australian Labor Party, Shadow Parliamentary Secretary for Industry and Innovation) Share this | Hansard source

I agree. In fact, small business and individuals have driven innovation in this country. But they do need a hand, and that is the point of some of the issues I am raising. Innovation, it can be said, has a persvasive influence that is hard to understand and quantify, but it almost always is self-evident. Indeed, interestingly, in the recently released Productivity Commission draft research report, it was noted that the full productive effects of research and development cannot be easily measured but nonetheless add considerably to our economy’s productivity via ‘complex causal pathways’. This is an opinion which echoes to an extent that of the Business Council of Australia’s recent report, New concepts in innovation: the keys to a growing Australia, which reminds us that innovation goes beyond research and development to capture the full spectrum of business activities that seek to improve and to augment goods and services.

The reason I raise that is to say to government clearly that sometimes, while you cannot measure exactly the productive paths to get to innovation, how you commercialise and the whole process, it is important to believe in it and to support it. There is no doubt in this country that that is something that we have not been doing. Innovation creates new industries and new products. It also renews old products. You can turn old industries through new methods of production and management coordination into new industries. Innovation creates new opportunities and new markets. It creates new opportunities for Australians to increase their wealth and standard of living. Most importantly, it creates new jobs in a whole range of areas which may not exist today. I think that is where government should be really focusing its energies.

Australia has a great reputation as a country of people who are resourceful and inventive, but our reputation does little to mask the reality that too many of our best people and best ideas are lost overseas. I would find it hard to believe that anyone in this place would disagree with that view. It has been said that the new global currency is talent; therefore, if we want to continue the lifestyle currently enjoyed by most Australians, then trading in this new currency is our new forefront. We need to trade in the currency of talent. This is our competitive advantage. This is how we can beat China. This is how we can compete with India. This is how we can remain competitive in the global market that faces all of us.

This notion that the new global currency is talent brings with it a lot of meaning. It really focuses attention on who the next group of people to determine the future will be and where they will come from. Will they come from Australia? Will they be our young people who are going to school today? Will they be the great innovators and inventors who find new ways to deal with old industries, who learn new ways to manage and to deal with financial products and who sell our intelligence to the rest of the world? Or will we remain an economy that bases its wealth on resources and non-elaborate manufactures with no value adding? Which economy do we want to be? That is the question I ask government.

There are certainly no barriers to stop any Australians today from leading the world in things such as medical science, nanotechnology, information technology, science and manufacturing technology, biotech and the aviation industry, just to name a few. Australians are actually great thinkers. We find all sorts of new ways to do things. I have quite a number just in my very humble area of Ipswich, in the great south-east of Queensland. We already do some of these things there. We already lead the world. But what I find most disturbing is that the people involved in these areas are frustrated. They are frustrated by the lack of support and, I think, the lack of belief in them by the federal government. They find all sorts of programs at state level—and there are programs at federal level as well, but they find they are bogged down in bureaucracy. They find little support in other areas, and they often find themselves with wonderful ideas—great inventions and great innovations—but they have to go overseas to see them commercialised or turned into something real. Then they often sell those technologies back to us, something which I find unsatisfactory.

What Australia has lacked over the past decade is a serious focus from government, a focus where a strong light is placed on what will be the driver for the next 16 years. Creating an economic environment conducive to innovation involves the maintenance of a stable macroeconomic environment—there is no question about that. Amongst other things, this includes the maintenance of a sensible fiscal and monetary approach to trade policy and a provision of adequate investment in physical economic infrastructure—something which this government is highly lacking in and something which I have spoken about in this House many times. There is a glaring inadequacy in the Howard government on these issues.

In addressing the right incentives for innovation, government must also address both the supply and demand sides of the challenges for innovation in Australia. In the case of both the supply and the demand sides, the government must construct support measures for innovation, R&D and commercialisation that help to alleviate market failures, rather than becoming simple replacements for market components. For example, the Productivity Commission makes the good point that R&D tax concession schemes must be carefully weighed and constructed to ensure that any support sought is indeed classified as R&D and would otherwise not have been undertaken by firms. Government should not replace R&D investment but rather give support measures to encourage more. In fact, the Labor Party, who are strong supporters of research and development, are looking at ways and measures to make it much more flexible and to support business research and development, including improvements to the tax concession regime. I think there is a whole range of areas that government just sits on and does not look at. I think it is something that we will need to do when we get into government.

Business has also called for reform of incentives regarding seed funding, Australia’s venture capital industry and capital gains, which are issues that Labor is actively considering. We are focused on these issues because we know that is where the next round of productivity growth will come from. That is where the next round of jobs will come from. They are the sorts of issues that will save and grow our manufacturing sector so we are not just reliant on a resources boom.

On the demand side, government needs to devise and instigate policies that support research and development in new goods and services. As the recent Business Council of Australia discussion paper on new concepts and innovation perceptively argues, research and development and the acquisition of new knowledge is not innovation at all unless it is developed into actionable processes and products by business; hence, the demand side of innovation solutions in Australia should concentrate on improving commercialisation of both public and private innovation in Australia today.

In the same vein, government programs such as the Commercial Ready and COMET schemes need to be reviewed and monitored more closely in order to ascertain the extent of their positive effect on the private sector. These are good and important programs, but they need to be carefully monitored and reviewed to ensure that they deliver what they are meant to. Again, there is no point in government just throwing money in the air and hoping it lands on the right tables. It is a little bit more involved than that and it takes a sharp focus from government. In light of our history of poor commercialisation performance, such government schemes must be regularly monitored and research data gathered. We need to do a better job. Equally, schemes such as the cooperative research centres, CRCs, must be reviewed to ensure that policy structure provides sufficient incentive for such centres to obtain their originally stated objective of translating research output into economic, social and environmental benefits. These are the great challenges that face us today.

There are some other good policy areas which need to be looked at carefully. Export market development grants have done a great job over a number of years. In fact, the Australian Industry Group has identified them as being historically successful and in need of an extra funding injection to ensure their continued and wider use—something which I personally support and think is a good idea. Along with the creation of the appropriate economic incentives, there needs to be room for continued government support of innovation on a broader scale. History has taught us that if we give the right tools, mechanisms and processes to good Australian innovators then they will deliver for the economy.

In the short time I have left I would like to make a point about the organisation of Clay Pave in Dinmore, which used to be in my electorate but unfortunately no longer is because of a redistribution. It is a brick-making, paving company. You would not think there would be a lot of innovation and new growth in making simple bricks, but this company not only seeks to keep its employees and work with unions constructively but also is one of the great innovators in Australia. They sell bricks to China. Can you imagine an Australian paver company selling bricks to China, the United States, Saudi Arabia in the Middle East, Japan and all sorts of areas? If an old industry like that can be innovative and can seek new ways and new markets, then I think there is hope for all industries in Australia. I think that is where the future is and that is the sort of company we should be looking at to make sure that Australia is productive in the future. (Time expired)

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