Scott Ryan (Victoria, Liberal Party, Special Minister of State) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

INDUSTRY RESEARCH AND DEVELOPMENT AMENDMENT (INNOVATION AND SCIENCE AUSTRALIA) BILL 2016

SECOND READING SPEECH

A national conversation about innovation has been going on since this Government's launch of the National Innovation and Science Agenda back in December last year.

For us, innovation is a serious, long-term plan to secure Australia's future economic prosperity.

Australia is now in its 26th year of uninterrupted economic growth against a background of major structural reforms and global shocks, including the GFC.

Despite this growth, our productivity performance has been lagging for almost a decade. We need to be serious about our productivity because productivity growth is what will keep us competitive and maintain our standards of living into the future.

Innovation is a major driving force for productivity growth and it's why we're resolute in our commitment to it.

We're in an economy which, for decades, has been continually changing to be more specialised, more flexible, more service orientated, more in tune with the needs of customers.

The challenge the Government is focused on is making sure the policy environment is right for existing and new businesses to succeed as this continues, in a world where knowledge and innovation are becoming the main sources of competitive advantage.

In 2016–17, we are on track to provide $10.1 billion to support research and experimental development. This includes support through the R&D Tax Incentive, direct funding such as National Health and Medical Research Council and Australian Research Council grants, and support through the Higher Education system. This is an increase of 3.55 per cent on the Budget Estimate of $9.7 billion in 2015–16.

Over the last ten years we have seen a 52 per cent increase in Australian Government support for R&D—from over $6.6 billion to over $10.1 billion.

Our challenge is to turn this investment into real benefits for Australians.

Innovation matters to all Australians because it is about job creation. It is about new and improved opportunities to do business, and it underpins a healthy economy.

Innovation is about new or improved goods or services, new processes or new business models.

Innovation is not just about tech start-ups. And it is not about existing firms losing business and jobs to new firms. It is also about established businesses doing things better to stay competitive.

Innovation is happening on the factory floor, on our farms, at the supermarket checkout and in the office, in addition to the leading-edge research occurring in our science laboratories. It's all about turning ideas into a commercial opportunity—to create jobs and better the quality of our lives.

The word may have a renewed popularity around the world, but the idea resonates with our history.

From the stump jump plough and the Hills Hoist to the Cervical Cancer Vaccine, Australians have developed a reputation for identifying problems and applying insight, intellect and determination to solve them.

We can't afford to be complacent, particularly as our competitors drive their own innovation agendas. We must be responsive and forward looking.

Australia needs to remain competitive globally. While the Australian economy has shown resilience, there are increasing risks to the economic outlook.

We have fallen in our ranking on the latest Global Innovation Index. Although this still leaves us in the 'Innovation Leaders' group we can and must do better.

Leading innovative countries like the UK and Sweden have established institutions like Innovate UK and VINNOVA that manage coherent, coordinated, national strategies for innovation. These institutions support high levels of public sector research translation for economic and social benefit. In many of these leading countries, the delivery of national innovation strategies is the responsibility of an independent agency, which operates at arm's length from government.

This Bill creates a new Innovation and Science Australia board.

The new board will replace the current Innovation Australia board and redefine the activities of that board. It will continue to be chaired by Mr Bill Ferris, an active and persuasive advocate for innovation to successive Australian governments. The Bill also creates a new board position of Deputy Chair, which will be filled by Dr Alan Finkel during his term as Australia's Chief Scientist.

Innovation and Science Australia will help us complete the first wave of the National Innovation and Science Agenda, pursue a second wave based on investment attraction and its 2030 Strategic Plan will guide our third wave.

Beyond that, it will work across the government—providing guidance around our $10.1 billion annual investment in Innovation, Science and Research—and will directly engage international, business and community sectors to improve the national innovation system's overall performance.

It's about bang for buck, about fostering an innovation ecosystem, and about linking our investment and our programmes together to create something more.

The composition of the membership of Innovation Australia will continue for Innovation and Science Australia. The members include some of the best minds in innovation and science in Australia today. The talent on this board represents innovators and entrepreneurs with proven records of success.

Innovation and Science Australia will continue the good work of Innovation Australia but will gain more strategic advisory responsibilities. Innovation and Science Australia has an ambitious work plan for the first 12 months of its operation and this legislation will help them to take it forward.

The work of Innovation and Science Australia will involve undertaking periodic audits of Australia's science, research and innovation system to assess and make recommendations on alignment with Government priorities. The board will identify gaps and better understand the activity in the science, research and innovation system and the impact of whole of Government investment.

A further key activity for the new board will be to develop, for the Government's consideration, a long-term, 2030 Strategic Plan, to be informed by the audit I have just mentioned. This plan will identify science, research and innovation investment priorities and specific areas for policy and programme reform.

Innovation and Science Australia will review the adequacy, capacity and condition of Australia's innovation system on a regular basis. These reviews will inform any updates to the Strategic Plan and improve government policies and programmes.

As part of promoting public discussion, Innovation and Science Australia will be able to commission and publish research, including publishing the board's advice to government when the board wishes to do so.

Innovation and Science Australia will also promote investment in industry, innovation, science and research in Australia including showcasing successful innovators, entrepreneurs and researchers. To make this happen the board, through its membership, will establish strong and extensive business and community links.

Similar to other Commonwealth statutory bodies, the board will develop a Statement of Intent in response to the Government's Statement of Expectations. It is government practice for Ministers to issue a Statement of Expectations to a statutory body to provide greater clarity about the government policies and priorities it is expected to observe in conducting its operations. The Statement of Expectations and the Statement of Intent recognise the independence of Innovation and Science Australia's statutory functions.

This Bill will mean that Innovation and Science Australia will have the flexibility, capability and capacity to provide strategic advice on all industry, innovation, science and research matters. It will improve the outcomes of the Australian Government's substantial investment in science, research and innovation. All Australians stand to benefit if we can deliver on our potential.

Aside from establishing Innovation and Science Australia, the Bill also provides a transparent and accountable mechanism for implementing Commonwealth spending decisions on industry, innovation, science and research activities through legislative instruments. This mechanism has been structured to support collaboration across the whole of government on these activities, which is a key concern being addressed by the National Innovation and Science Agenda.

The ability for the Commonwealth to prescribe programs and identify operational elements of spending activities in subordinate legislation in this way provides a level of flexibility for the government to be agile and meet changing demands whilst ensuring its activities and programs are effective, robust , sustainable, and subject to parliamentary oversight.

To conclude, the story of Australia has been a story of innovation.

We've shown we're a nation that can harness its ingenuity to create opportunity and prosperity.

Our future prosperity depends on our ability to innovate. The Government will continue to play its part, getting the settings right to encourage existing firms to grow and new firms to start, creating new opportunities and driving jobs and prosperity. We can boost Australia's innovation capacity by better coordinating our investment in innovation, science and research activities.

This Bill lets us bring Australia's leading minds to bear—from business, commercialisation and research—to make our investments perform better for all Australians. It will point the way for turning today's investments to tomorrow's innovations, to the jobs of the future.

I commend the Bill to the Chamber.

Katy Gallagher (ACT, Australian Labor Party) Share this | Link to this | Hansard source

Labor support this bill, which essentially implements policies we announced before the election. The bill facilitates the transition of the Innovation Australia board to a new body, Innovation and Science Australia, and provides legislative authority for Commonwealth spending on science, research and innovation programs.

Innovation and Science Australia mirrors the agency announced in our policy, Innovate Australia, and is intended to provide independent advice to the government on innovation policy. We are pleased that the Turnbull government has taken this approach, and we look forward to working with the new agency in the future.

As senators would be aware, 'innovation' became a buzzword after Mr Turnbull replaced Mr Abbott as Prime Minister in September last year. The word had been all but banned under Mr Abbott, but under Mr Turnbull its use suddenly seemed to become almost compulsory. It is a good thing that the government now accepts that a modern economy must be an innovative economy. That said, however, there is much more to fostering a genuine culture of innovation than talking about start-ups, disruption and gee-whiz technology, as the newly installed Mr Turnbull liked to do.    The government has yet to show that it can get past its obsession with gee-whizzery.

A comprehensive innovation policy should aim at transforming the economy, industry by industry and firm by firm. That is the approach needed to make Australia more globally competitive and to create the high-skill, high-wage jobs of the future. It is an approach that proceeds incrementally, but an incremental approach is not a piecemeal approach. Yet, piecemeal tinkering is all the government has offered since it announced its National Innovation and Science Agenda in December last year.

The Abbott government ripped more than $3 billion from science, research and innovation programs. NISA has restored only $1 billion of that investment in the nation's future. This is innovation-lite, and it is not enough to create the culture of innovation that Australia needs in the wake of the mining boom. Labor is firmly committed to building that culture. It is why during the election campaign we announced investment of more than a billion dollars in science and research, on top of our commitments in schools, TAFE and universities. For Labor, fostering innovation is bound up with our commitment to social democracy. It is about building an Australia that not only creates wealth but where all have the opportunity to share in that wealth and realise their full human potential. We will support any measure that contributes to achieving this goal. In that spirit, we support this bill.

Scott Ryan (Victoria, Liberal Party, Special Minister of State) Share this | Link to this | Hansard source

I commend the bill to the Senate.

Question agreed to.

Bill read a second time.