Budget Review 2020–21 Index
Dr Hunter Laidlaw
While the overall picture of science
research funding will become clearer when the Department of Industry, Science,
Energy and Resources releases the Science,
Research and Innovation Budget Tables (SRI Tables), some notable
updates were provided in the Budget. Until the SRI Tables are updated, overall
trends can be difficult to interpret, particularly as the sector crosses
several functions discussed in the Budget
Strategy and Outlook Budget Paper No. 1: 2020–21 including general
research, education, health and agriculture.
When the SRI Tables were last updated, Australian Government
spending on research and development (R&D) as a proportion of Gross
Domestic Product (GDP) was forecast to be 0.48 per cent in 2019–20 (Figure 1).
This is below the long-term average of 0.61 per cent and is the
lowest level in 40 years. The recent trend in government investment is consistent
with Australia’s gross expenditure on R&D (GERD; including by business and
higher education) which is below the
OECD average and has been trending down since 2008.
Figure 1: Australia Government investment in R&D as percentage of GDP
Source: Department of
Industry, Innovation and Science, 2019–20 Science, Research and Innovation (SRI) Budget
Tables, Sector table 6, updated 26 February
2020.
Research support
University research
The Budget provides a major boost to support the cost of
university research in 2020–21 with an additional $1.0 billion to be provided
through the Research Support Program that provides Research Block Grants to
higher education providers. This will assist universities with the post-COVID
recovery following significant shortfalls in income from overseas student fees
that would otherwise support research in the sector. It is the main component
of the JobMaker Plan—Research Package (Budget
Measures: Budget Paper No. 2: 2020–21, p. 79). Further discussion
is provided in the Higher
education research and teaching brief.
Research infrastructure
The Government will continue implementation of the 2016
National Collaborative Research Infrastructure Strategy (NCRIS) Roadmap
with the 2020
Research Infrastructure Investment Plan (RIIP 2020). The new plan, to be
‘available shortly’, will continue to provide support for national research
infrastructure facilities and investment in emerging priorities as identified
in the 2016 Roadmap. It forms part of the Research Package.
The implementation of the previous investment plan was
announced in the 2018–19
Budget with a $1.9 billion allocation over 12 years from 2017–18. A
list of currently funded projects is provided on the research
infrastructure projects webpage. This Budget provides funding for four new national
research infrastructure projects for three years from 2020–21 through the RIIP funding
envelope:
- early implementation of the Sea Simulator project to support the Great Barrier Reef Restoration and
Adaption Program ($36.3 million)
- increased capabilities of the e-research platforms in humanities,
arts, social sciences and Indigenous fields ($8.9 million)
- establishment of new synthetic biology research infrastructure for
emerging disease and biosecurity risks and to address critical gaps in technological
platforms and informatics ($8.3 million) and
- upgrade of the Australian
Community Climate and Earth System Simulator (ACCESS) to increase
Australia’s capacity to respond to future climate disasters and emergencies
($7.6 million). ACCESS is a suite of models used for research and operational needs
in weather forecasting and climate projections.
R&D tax incentive
This tax incentive is designed to support business
investment in R&D. Budget Paper No. 2 details changes
to the scheme that are estimated to decrease the underlying cash balance by
$2.0 billion over the forward estimates period (pp. 19–20).
Business
expenditure on R&D (BERD) in Australia relative to GDP has been
declining and contributes to the downtrend seen for GERD noted earlier. It is also
consistently below
the OECD average. As the measure effectively reverses the Government’s
earlier changes to the scheme, it is not certain whether this will lead to any
significant impact on these broader trends. The R&D tax incentive is
discussed in detail elsewhere in this Budget Review.
Careers in Science, Technology,
Engineering and Mathematics (STEM)
In addition to measures that support university research and
researchers through the COVID disruption, other Budget measures are designed to
encourage or support STEM-based careers. The cross-portfolio JobMaker Plan—Second
Women’s Economic Security Package continues support for existing
initiatives for women and girls to gain STEM skills and capabilities (Budget
Paper No. 2, pp. 67–68). This includes the Women in STEM Ambassador (Professor Lisa
Harvey-Smith was recently
reappointed for another two years), Women
in STEM Entrepreneurship Grants Program and Girls in STEM Toolkit (total
$14.5 million over four years). A Women in STEM Industry Cadetship will
also be established to support 500 women working in STEM industries to complete
an Advanced Diploma through a combination of study and work‑based
learning ($25.1 million over five years). Other changes in higher education
funding that may impact STEM-related fields (such as changes
to university funding arrangements and student contributions) are discussed
in the Higher
education research and teaching brief.
Agency funding
Commonwealth Scientific and
Industrial Research Organisation (CSIRO)
The Department
of Industry, Science, Energy and Resources Portfolio Budget Statements
(DISER PBS) indicate that CSIRO is facing a reduction in funds from its own source
revenues in 2020–21, including a $91 million reduction in sales of goods
and services (p. 256). In response, the Government will provide an
additional $459.2 million over four years through the JobMaker
Plan—Commonwealth Scientific and Industrial Research Organisation—supporting
essential scientific research measure including $133.1 million for
2020–21. According to Budget
Paper No. 2, this will ‘address the impacts of COVID-19 on its
commercial activities and ensure it is able to continue essential scientific
research’ (p. 115).
The net impact of decreased funding from the CSIRO’s own
source revenues, offset by additional funding from Government, is that the
CSIRO’s total resourcing is expected to grow slightly from $1,759.0 million in
2019–20 to $1,810.3 million in 2020–21, an increase of 2.9 per cent (DISER PBS,
p. 256). CSIRO’s average staffing level will also increase by 210 to
5,351. This will assist the organisation to increase staffing from their 2014–15
low of 4,836 full time equivalent (FTE) staff, but this is still well under their
earlier
staffing level of almost 6,000 FTEs in the early 2000s.
Australian Research Council (ARC)
Appropriations for the ARC’s Discovery and Linkage research
programs are slightly lower than expected compared with the last budget update
and the balance between these programs will shift a little (Table 1).
Funding for the Discovery program remains relatively steady across the forward
estimates, while funding for the Linkage program increases more than previously
expected. This results in the proportional funding split between the Discovery
and Linkage programs changing from 64:36 to 60:40 per cent going forward.
Table 1:
ARC special appropriations compared with last budget update, 2019–20 to 2023–24
| $ million |
Budget |
2019–20
|
2020–21
|
2021–22
|
2022–23
|
2023–24
|
| Discovery |
2019
(a) |
507.0 |
512.5 |
523.2 |
535.0 |
na |
|
2020
(b) |
485.8 |
483.3 |
487.0 |
487.9 |
490.6 |
| Linkage |
2019 |
279.2 |
288.2 |
293.9 |
300.6 |
na |
|
2020 |
289.1 |
322.2 |
323.9 |
325.2 |
327.1 |
| Total |
2019 |
786.2 |
800.8 |
817.2 |
835.6 |
na |
|
2020 |
774.9 |
805.5 |
810.9 |
813.1 |
817.7 |
na: not applicable
Source: (a) Australian Government, Portfolio Additional Estimates Statements 2019–20:
Education, Skills and Employment Portfolio, p. 81. (b) Australian Government, Portfolio budget statements 2020–21: budget related
paper no. 1.4: Education, Skills and Employment Portfolio, p. 147.
National Health and Medical
Research Council (NHMRC)
The NHMRC uses the Medical Research Endowment Account (MREA)
to support medical research and medical research training. Appropriations to the MREA are slightly lower than expected
from last budget and the future annual rate of increase is also smaller (Table
2). No additional funding measures were provided directly to the NHMRC in the
Budget.
Table 2: Appropriations to the
NHMRC MREA (accrual basis), 2019–20 to 2023–24
| $ million |
2019–20 |
2020–21 |
2021–22 |
2022–23 |
2023–24 |
| 2019 Budget (a) |
842.8 |
856.3 |
870.0 |
883.9 |
na |
| % annual increase |
1.62 |
1.60 |
1.60 |
1.60 |
na |
| 2020 Budget (b) |
846.6 |
853.9 |
862.4 |
872.8 |
885.0 |
| % annual increase |
2.08(c) |
0.86 |
1.00 |
1.20 |
1.40 |
Source: (a) Australia Government, Portfolio budget statements 2019–20: budget related
paper no. 1.9: Health Portfolio,
p. 356. (b) Australian Government, Portfolio budget statements 2020–21: budget related
paper no. 1.9: Health Portfolio,
p. 346.
(c) Calculated using 2018–19 data in (a).
Medical Research Future Fund (MRFF)
The final
transfer of $3.2 billion was made to the MRFF on 21 July 2020,
fulfilling the Government’s $20 billion commitment to the fund. In recent
years, these funds have been sourced from savings in the health portfolio (Budget
Paper No. 1, p. 10-43). The fund is expected to grow to over
$21 billion during 2022–23 (Finance
PBS, p. 33).
A total of $572.6 million is set to go towards medical research
from the MRFF in 2020–21, increasing to $646.0 million in 2021–22. Management
fees for the fund are expected to increase from $26.0 million in 2019–20
to $87.7 million in 2020–21, coinciding with increased investment earnings
and gains which increase from $55.3 million to $889.2 million over
the same period (Finance
PBS, p. 33).
Consultation
on new MRFF Australian Medical Research and Innovation Priorities (which are
considered by the Health Minister before the Government decides on the
disbursement of MRFF funding) has recently closed. The new priorities for
2020–22 must be tabled in Parliament by 6 November 2020. These priorities
must be consistent with the Australian Medical
Research and Innovation Strategy 2016–21 until it expires in November 2021,
after which a new five-year strategy must be developed.
Australian Nuclear Science and
Technology Organisation (ANSTO)
ANSTO received additional funding of $238.1 million
over four years and $39.0 million per year ongoing (Budget
Paper No. 2, p. 60). The four-year package is to support ANSTO’s core
business operations ($62.7 million), the nuclear medicine production
facility and response to its production disruption ($93.8 million), and radioactive
waste and spent fuel management and decommissioning work ($81.6 million).
The Department of Finance will also undertake a scoping study with ANSTO on
governance and commercial arrangements (expenditure not published due to
commercial sensitivities).
Australia Radioactive Waste Agency
(ARWA)
In addition to expenditure on radioactive waste management for
ANSTO, $103.6 million over four years is being provided to the National
Radioactive Waste Management Facility (NRWMF) program (Budget
Paper No. 2, p. 122). Around $54.9 million has previously
been spent on the site selection process between July 2014 and October
2019.
Operational
from 21 July 2020, the Australian Radioactive Waste Agency
(ARWA) is responsible for progressing the NRWMF and obtaining the relevant
approvals for construction and operation of the facility. ARWA commenced
as a branded function within the Department of Industry, Science, Energy and
Resources and is expected to transition to a non-corporate Commonwealth entity.
The Budget includes $37.3 million to establish the
agency which will be based in Adelaide.
The remaining $66.3 million is being provided to
undertake the technical, design, regulatory and governance works required to
progress and secure the NRWMF. On 1 February 2020, the Minister
announced that Napandee near Kimba in South Australia was the preferred
site for the facility. The National Radioactive Waste Management Amendment (Site Specification,
Community Fund and Other Measures) Bill 2020 was
subsequently introduced to specify the site in legislation. The selection of
the site remains controversial, as discussed in the Bills Digest and Senate inquiry report. While the legislation
has passed the House, the Senate still needs to consider the Bill.
Australian Renewable Energy Agency
(ARENA) and emissions reduction
New long-term funding has been provided to ARENA as part of
the Government’s investment in new energy technology (Budget
Paper No. 2, p. 118–119). Through this 12 year funding package,
ARENA will receive guaranteed baseline funding of $1.4 billion from
2020–21 to support investment and commercial readiness of emerging low emission
technologies. The Government will introduce
new legislation to support the measure and to extend ARENA’s currently
legislated funding that ends in 2021–22 (section 64 of the ARENA Act 2011).
A core element of the Government’s Long-term Emissions
Reduction Strategy is the Technology Investment Roadmap (see the discussion paper).
This Roadmap will essentially be an R&D strategy and is designed to
accelerate the development and commercialisation of new and emerging
technologies that can contribute to lowering greenhouse gas emissions. The
Strategy will be taken to the next international climate change conference in
Glasgow in 2021. Funding is being provided to implement the Roadmap ($5.2
million over four years from 2020–21). This will support the annual Low
Emissions Technology Statements to identify priority technologies and
create an ongoing Technology Investment Advisory Council. Further details on the
package and related issues are discussed elsewhere in this Budget Review.
Stakeholder reaction
Representative organisations in the science sector have
broadly welcomed the Budget. The Australian
Academy of Science recognises it as a significant response to the pandemic
and called for more to be done to fix the fragmented research funding system ‘to
place it on a sustainable footing over the long term’. The Australian
Academy of Technology and Engineering also welcomed the Budget and its
lifelines to the innovation economy that will ‘contribute to the translation
and commercialisation of research, build industry engagement and create jobs’. Research
Australia welcomed the commitment to university research jobs as an ‘interim
step towards establishing a more sustainable higher education sector’. Science
& Technology Australia backed many of the Budget initiatives and the
crucial role of STEM in the economic recovery.
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