This Bills Digest replaces an interim Bills Digest published on 4 December 2023 to assist in early consideration of the Bill.
Key points
- The Australian Research Council Amendment (Review Response) Bill 2023 (the Bill) amends the Australian Research Council Act 2001 (ARC Act) to make changes to the Australian Research Council’s (ARC) purpose, oversight and funding arrangements.
- The Bill inserts a revised objects provision into the ARC Act, with the aim of establishing a clearer statement of the ARC’s purpose.
- The Bill establishes an ARC Board as the accountable authority of the ARC. The Board will have skills-based appointees, First Nations representation, and a representative of regional, rural and remote Australia. The Bill devolves the appointment process for the Chief Executive Officer to the Board, in consultation with the Minister.
- The Bill makes the Board responsible for providing advice to the Minister on funding rules (grant guidelines), with approved funding rules now subject to disallowance.
- The Board will also have responsibility for approving spending on research programs under funding rules, including grants within the National Competitive Grants Program. The Minister will retain the ability to approve grants for designated research programs, which currently include ARC Centres of Excellence, Industrial Transformation Training Centres and Industrial Transformation Research Hubs. The Minister also retains the right to direct the ARC to not fund a research proposal or to recover funds from previously approved research grants based on security, defence or international relations concerns.
- The Bill changes the funding arrangements for the ARC to enable greater funding flexibility and certainty, and to reduce legislative burden.
- The Bill implements 6 recommendations from Trusting Australia’s Ability: Review of the Australian Research Council Act 2001.
- The main organisations representing universities are broadly supportive of the Bill.
- The Senate Standing Committee for the Scrutiny of Bills has sought advice from the Minister on a number of aspects of the Bill. The Bill has been referred to the Senate Education and Employment Legislation Committee for inquiry and report by 5 February 2024.
Introductory Info
Date introduced: 29 November 2023
House: House of Representatives
Portfolio: Education
Commencement: 1 July 2024
Purpose and structure of the Bill
The purpose of the Australian
Research Council Amendment (Review Response) Bill 2023 (the Bill) is to
amend the Australian
Research Council Act 2001 (ARC Act) to make changes to the
Australian Research Council’s (ARC) purpose, oversight and funding arrangements.
When introducing the Bill in Parliament, the Minister for Education Jason Clare
stated:
As a nation we are rightly proud of our reputation in
research, and the measures in this bill will help support the discoveries and
innovations of the future. They will modernise the ARC, strengthen it, and
build more trust so it can continue to spur innovation and catalyse
productivity in the years ahead.[1]
The Bill consists of 5 Schedules:
- Schedule 1 repeals and replaces the objects section of the
ARC Act to set out a clearer statement of the ARC’s purpose.
- Schedule 2 inserts a new Part 3 establishing the Board
and setting out administrative matters relating to the Board, including
its functions and procedures, its composition, the appointment of members and
the CEO. It also provides for the establishment of new committees by the Board
or Minister to support the Board, and provides for the Minister to give the Board
directions by non-disallowable legislative instrument in certain circumstances.
- Schedule 3 repeals and replaces Division 1
of Part 7 relating to Financial Assistance for Approved Research
Programs. It enables the Board to approve grant funding, according to approved
funding rules prepared by the Board and approved by the Minister,
for programs except designated research programs. It establishes that
funding of designated research programs must be approved by the
Minister. It also provides for the Minister to give the Board directions
to not approve grants, or to terminate funding approval, ‘for reasons relevant
to the security, defence or international relations of Australia’. In addition,
this Schedule sets out changes to the funding of the ARC from special
appropriation to annual appropriation arrangements.
- Schedule 4 repeals Part 6 relating to Reporting and
inserts proposed section 65A specifying the reporting requirements of
the ARC, so that matters such as ministerial directions are included in the
Annual Report.
- Schedule 5 enables the Minister to make transitional rules
relating to the amendments or repeals made by the Bill.
The Bill implements 6 recommendations from Trusting
Australia’s Ability: Review of the Australian Research Council Act 2001.
Background
Australian
Research Council
The Australian Research
Council (ARC) is a Commonwealth entity established as an independent body
(a non-corporate Commonwealth entity) under section 5 of the ARC Act.
The purposes of the ARC are to:
- make recommendations to the Minister regarding the funding of
research applications
- administer
the research funding programs
- provide advice to the Minister on research matters.[2]
In its Annual Report, the ARC describes itself:
The ARC is a vital component of Australia’s innovation and
research system. We play an integral role in supporting the research sector to
produce high-quality and impactful research through the delivery of the NCGP
[National Competitive Grants Program].
Our broader remit includes the provision of high-quality
research policy advice to the Australian Government, overseeing the Australian
research ethics and integrity framework, the national university research
assessment system that promotes excellence in research and its engagement and
impact, powerful data assets, and our role in fostering research quality,
translation and impact. The ARC also brokers partnerships between researchers
and industry, government, community organisations and the international community.[3]
The National Competitive Grants Program
The ARC primarily funds researchers, research teams, and
research centres through the National
Competitive Grants Program (NCGP) and its 2 component grant schemes, the
Discovery Program and the Linkage Program.
The Discovery
Program funds research by individuals and teams and includes funding for
fundamental, basic, ‘blue sky’ research.[4]
In 2023, the Discovery Program funded
research through 5 schemes:
The Linkage
Program funds research that involves partnerships between researchers and
business, industry, community organisations, and other publicly funded research
agencies. These partnerships aim to encourage ‘the transfer of skills,
knowledge and ideas as a basis for securing commercial and other benefits of
research’.[5]
In 2023, the Linkage Program funded
research through 5 grant schemes:
Grants are provided through the NCGP based on competitive,
peer-reviewed processes. Most NCGP schemes are highly competitive. For example,
for all scheme rounds commencing in 2023 and 2024, the overall success rate of
applications was 17.7%.[6]
ARC Review
On 30
August 2022, the Minister for Education announced that an independent
3-person panel would undertake a Review
of the Australian Research Council Act 2001. A review of the ARC was a
unanimous recommendation of a 2022 Senate Standing Committee on Education and
Employment inquiry
in relation to the Private Senator’s Australian Research Council Amendment
(Ensuring Research Independence) Bill 2018.[7]
The ARC review was the first comprehensive review of the ARC since the
introduction of the ARC Act in 2001.[8]
The Terms of Reference for the review asked the panel to consider:
- whether
the role and purpose of the ARC as set out in the legislation remains relevant,
including consideration of the contribution the ARC can make to identifying
reforms to its programs to actively shape the research landscape in Australia
and better align with comparable research agencies
- the ARC
governance model and management functions and structures to ensure they are
contemporary, fit for purpose, and meet the needs of stakeholders
- opportunities
to improve the legislation to better facilitate globally competitive research
and partnerships, reduce unnecessary administrative and legislative burden and
increase agility; and
- how the
legislation could be revised to reflect the breadth of functions of the ARC and
its evolution, including the measurement of the impact and excellence of
Australian research and advise on contemporary best practice for modernising
and leveraging these measures.[9]
On 9
November 2022, the review panel released a Consultation paper and
invited submissions.[10]
The review panel received 223
written submissions. It also held meetings and focus groups with
stakeholders.
ARC Review final report
On 20
April 2023, the Minister for Education released the ARC review panel’s final
report, Trusting
Australia’s Ability: Review of the Australian Research Council Act 2001
(ARC Review). It includes 10 recommendations which aim to ‘enhance the trust in
the ARC by the government and the research community’.[11]
Upon release of the report, ARC Chief Executive Officer
Judi Zielke stated that:
…while a response to the findings of the Review is a matter
for the Government, the report is a strong endorsement of the role and positive
impact the ARC has had on Australia’s research capability over the last twenty
years.[12]
Government
response to the ARC Review final report
On 22
August 2023, the Minister for Education released the Australian
Government response to the ARC Review. The Government agreed or
agreed in principle with each recommendation. Amendments to the ARC Act
were noted as required to implement 6 recommendations (Recommendations 1,
2, 5, 6, 7 and 9).
Consultation
paper on proposed amendments to the ARC Act
On 30
October 2023, the Department of Education released the Australian
Research Council Act 2001 – Proposed Amendments Consultation Paper
(Consultation Paper). The Consultation Paper ‘sets out the proposed changes to
the [ARC’s] enabling legislation … as part of the Government’s response to the
recommendations from the independent Review’.[13]
The Department invited submissions and also held targeted
consultations in October – November 2023. 11
submissions were received but do not appear to have been publicly released.
The Consultation Paper did not provide substantially more
detail regarding the Government’s proposed approach than had already been
provided in its response to the ARC Review. Several of the main advocacy
organisations representing universities expressed the need for greater clarity
on key issues and called for the release of an exposure draft of the Bill for
consultation.[14]
An exposure draft was not released prior to the introduction of the Bill.
Committee consideration
Senate Education and Employment Legislation Committee
The Bill has been referred to the Senate Education and
Employment Legislation Committee for inquiry and report by 5 February 2024.
Details of the inquiry are at the inquiry
homepage. Submissions closed on 19 January 2024. The Committee received 27 submissions.
Senate Standing Committee for the Scrutiny of Bills
The Senate Standing Committee for the Scrutiny of Bills considered
the Bill and identified several issues of concern.[15]
The Committee has sought further detailed advice from the Minister as to:
- why it
is necessary and appropriate to provide the minister and the board with a broad
power to vary funding approvals under proposed subsections 47(5) and 48(4);
- why it
is necessary and appropriate to provide the CEO with a broad power to vary
funding agreements under proposed subsection 50(2);
- whether
guidance can be provided as to how the CEO must be satisfied that a breach of a
condition of the funding agreement has occurred under proposed subsections
50(1);
- whether
independent merits review will be available in relation to a decision made
under proposed subsection 50(1), 50(4) or 50(5) of the bill or if not, why not;
and
- why it
is necessary and appropriate to exclude independent merits review of a decision
made under proposed subsection 50(1), 50(4) or 50(5) of the bill, with
reference to the Administrative Review Council's guidance document, What
decisions should be subject to merits review?[16]
At the time of writing, the Minister’s response had not
been received by the Committee.[17]
Policy position of non-government parties/independents
At the time of writing there does not appear to have been
any statements by non-government parties or independents on the Bill itself.
Australian Greens Senator Mehreen Faruqi did, however, welcome
the Government’s decision to accept the recommendations of the ARC Review.
Senator Faruqi has previously advocated for the removal of the ministerial
discretion over grant approvals (the ministerial ‘veto’) and introduced the Australian
Research Council Amendment (Ensuring Research Independence) Bill 2018.[18]
In her second reading speech, Senator Faruqi stated:
No Minister should be able to dictate which research projects
get funded and which ones don't. The true test of academic freedom is that it
must be free from political interference, no matter who is in Government. It
should be based only on an independent rigorous assessment process.[19]
Position of major interest groups
To date, there has been little detailed commentary on the
Bill, but several major stakeholders in the research community have expressed
support for the Bill. These groups include:
Currently, there does not appear to be any stakeholder
groups publicly opposing the passage of the Bill.
Further relevant stakeholder commentary was provided
during the ARC Review, in response to the Consultation Paper, and through
submissions to the Bill inquiry. There appears to be strong support in the
university and research community for the implementation of the recommendations
of the ARC Review.
Financial implications
The Explanatory Memorandum states
that:
The measures contained in the Bill, which establish the ARC
Board as the accountable authority and restructures the ARC’s governance
arrangements, will cost approximately $1.5 million per annum
(approximately $0.6 million per annum of direct costs from the
establishment of the Board and $0.9 million to support the governance
processes). These costs will be met from existing resourcing through
reprioritisation from within the ARC’s current annual departmental budget with
zero net financial impact.[20]
Statement of Compatibility with Human Rights
As required under Part 3 of the Human Rights
(Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the
Bill’s compatibility with the human rights and freedoms recognised or declared
in the international instruments listed in section 3 of that Act. The
Government considers that the Bill is compatible.[21]
Parliamentary Joint Committee on Human Rights
The Parliamentary Joint Committee on Human Rights has
considered the Bill and had no comment.[22]
Key issues and provisions
A clearer statement of the ARC’s purpose
The ARC Review highlighted that the ‘role and historical
purpose of the ARC is not evident from the ARC Act itself’.[23]
Currently, the ARC Act states that the objects of the ARC are to provide
recommendations regarding research programs to be funded, to administer
research funding, and to provide advice to the Minister on matters related to
research.[24]
The ARC Review noted that stakeholders highlighted the
importance of the ARC as the ‘guardian of basic, or fundamental “blue-sky” research’.[25]
The Review also noted that the ARC had recently begun to provide grants
administration and peer review services to other government agencies.[26]
The Review recommended greater legislative clarity for the role of the ARC,
including providing a clearer scope for the NCGP (Recommendation 1) and
for the ARC’s activities beyond the NCGP (Recommendation 2).[27]
The Bill repeals and replaces section 3, the
objects clause, setting out more comprehensively the purpose of the ARC.[28]
The amended purpose largely reflects the Review’s recommendations.
However, the Review also suggested that the ‘commitment to
funding basic research should be incorporated into the purposes of the ARC
Act along with an explicit statement about the value such investigator-led
basic research affords in underpinning the remainder of the research ecosystem’.[29]
While basic research is specified as one type of research to be funded (proposed
paragraph 3(e)), the revisions do not provide an explicit statement
highlighting the particular importance of basic, or investigator-led, research.
This omission was highlighted by Universities Australia in its response to the
Consultation Paper.[30]
Establishment of a Board
Schedule 2 of the Bill inserts a new Part 3
establishing a Board and makes a range of associated consequential
amendments relating to the functions and powers of the Minister, Board
and CEO.
The ARC, as originally constituted, was governed by a
board. The board was abolished by the Australian
Research Council Amendment Act 2006.[31]
At the time, the Australian Vice-Chancellors’ Committee expressed concern about
the impact of the board’s removal on operations of the ARC, and the National
Tertiary Education Union noted that the board was a source of strategic advice
and ‘a buffer’ to the political whims of the day.[32]
The ARC Review noted that its consultations had indicated
strong support for the re-establishment of an ARC board. The ARC Review
recommended a board be established with functions including the appointment of
the CEO, approving the appointment of the College of Experts (CoE, discussed
below), and approving recommendations for funding under the NCGP (Recommendation
6).[33]
These functions of the Board are outlined in the Bill.[34]
The ARC Review recommended that the board be chaired by a
person held in high regard by universities and the broader research community.[35]
It also recommended that the board consist of up to 6 other members with a
‘combination of skills, experience, and perspectives relevant to the functions
of the ARC across the spectrum of ARC disciplines, Aboriginal and Torres Strait
Islander leadership, research administration and evaluation, and university
industry partners’.[36]
The Review further adds:
The function we propose here for the Board requires members
with broad expertise across the spectrum of ARC funded disciplines and
collaborating organisations, including sufficient senior management and
governance experience to fulfill that role.[37]
The Bill provides that the Minister may appoint a Chair,
Deputy Chair, and ‘not fewer than 3, and not more than 5, other members’ to the
Board.[38]
The Minister must be satisfied that the person appointed as Chair has
‘substantial experience or expertise, and professional credibility and
significant standing’ in research or the management of research.[39]
In addition, the Minister must be satisfied that:
- a majority of Board members ‘have substantial experience
or expertise in one or more fields of research or in the management of
research’
- one of the Board members is an Indigenous person and
- one of the Board members is a person who will represent
regional, rural and remote Australia.[40]
The Minister must also have regard to the Board's
membership ‘reflecting the diversity of the general community’.[41]
Some stakeholders have been critical of the proposed
composition of the Board, suggesting it will not have sufficient
expertise.[42]
The Regional Universities Network welcomed the inclusion of a member to
represent rural and regional Australia, which it had recommended in its
response to the Consultation Paper.[43]
Appointment of CEO
The CEO of the ARC is currently appointed by the Minister.[44]
As recommended by the ARC Review, the Bill transfers this function to the Board
(recommendation 7).[45]
The Bill also amends the functions of the CEO and the appointment process,
including the required qualifications of the CEO.[46]
Existing subsection 34(2) requires that the Minister consider the [proposed
CEO’s] ‘record in research and management’, whereas proposed subsection
34(2) will require that the Board be satisfied that the proposed CEO
has ‘substantial experience or expertise, and professional credibility and
significant standing, in one or more fields of research or in the management of
research’.
The CEO must also be appointed on the basis of a
merit-based process that includes the position being publicly advertised.[47]
Although the Board appoints the CEO, the Minister retains a role in the
process. The proposed provisions in relation to the CEO are similar to, and
consistent with, provisions applicable to comparable CEO positions at statutory
authorities. However, rather than requiring the Board to ‘consult’ with
the Minister about the proposed appointment of a CEO, proposed subsection
34(3) would require the Board to give the Minister details of at
least 2 possible candidates for appointment as CEO and provide the Minister
with a reasonable opportunity to make representations to the Board about
those candidates. In effect, this proposed provision formalises and to some
extent codifies consultation processes that have been required in recent
comparable legislation.[48]
Grant rules and the assessment process
The Bill repeals and replaces Division 1 of Part 7
of the Act, providing for the grant of financial assistance for research
programs. Notably, the Bill distinguishes between standard research programs
and newly defined designated research programs, and provides for a
separate approvals process for these research programs.
Making grant rules
Under the existing Act the CEO makes funding rules for
grant programs which outline how researchers make applications for funding, the
criteria these applications are assessed against, and how assessment decisions
are made.[49]
The CEO then presents the rules to the Minister, who must either approve the
rules or send them back to the CEO to address specific concerns of the
Minister.[50]
Once approved, the rules are a legislative instrument but not subject to
disallowance.[51]
The Bill proposes to transfer responsibility for the
preparation of the rules from the CEO to the Board.[52]
In addition, the Legislation (Exemptions and Other Matters) Regulation 2015
will be amended separately, so that the rules will be disallowable.[53]
In the consultation on the proposed changes, the Regional
Universities Network was critical of the rules having the status of a
disallowable legislative instrument, stating that this ‘introduces a risk of
delays to, or political interference with, the operations of the ARC’.[54]
Assessment of grant applications
Researchers and research organisations submit applications
for funding of research proposals based on the criteria outlined in the rules.
The ARC then uses a rigorous process of peer review to
assess the applications against the criteria.
The peer review process is guided by the College of
Experts (CoE), which is currently comprised of 318 members who are experts of
international standing in the Australian research community.[55]
The CoE members are expected to take on roles as general
assessors and Selection
Advisory Committee (SAC) members, as well as assign work to the detailed
assessors drawn from the wider Australian research community.
The assessment process includes a
written assessment by ‘detailed assessors’ (typically
at least 2) who are chosen for their relevant expertise. Applicants can respond
to this assessment and their response, along with the written assessment,
is considered by the ‘general assessors’ (at
least 2). Based on the work of the detailed and general assessors, a ranking
is formulated and provided to the Selection Advisory Committee (SAC), which
discusses the applications and makes a recommendation to the CEO on the
applications to be funded and the amount of funding to be provided.[56]
The CEO then considers the SAC’s recommendations and each
application’s National Interest Test statement before submitting a list of research
proposal applications that are recommended for funding (and the amount of
funding) to the Minister.[57]
Formalising the College of Experts
As explained by the ARC Review, the CoE ‘was previously a
Designated Committee with appointments made by the Minister under Part 4 of the
ARC Act’, however, from around 2011 this practice changed to reduce the
administrative burden.[58]
The ARC Review notes that it has been argued that ‘the streamlined processes
diminished the standing of the College and the oversight of their quality and
relevance of the qualifications’.[59]
The ARC Review recommended that the board approve the appointment of the CoE
and have the ability ‘to establish and appoint members to other such committees
as it deems beneficial for the effective functioning of the ARC’.[60]
The Bill establishes a formal requirement that the Board
create a committee to be known as the College of Experts (CoE).[61]
The Bill also provides for the Board to establish any other committees to
assist the Board or the CEO in the performance of their functions.[62]
The committees may consist of such persons, and on terms, as determined by the Board.[63]
However, while the Board may abolish other committees, it cannot abolish
the CoE.[64]
Approving research proposals and the ministerial ‘veto’
Under the ARC Act, the CEO (informed by advice from
the CoE) provides a list of research proposal applications that are recommended
for funding to the Minister.[65]
The Minister must then approve each research proposal before it can receive
grant funding.[66]
The ability for the Minister to refuse to approve a research proposal, and thus
deny it funding, has generally been referred to as the ministerial ‘veto’.
The existence of the ministerial veto has been the most
contentious part of the current ARC Act. As described in the ARC Review,
there have been instances where Ministers have refused to approve specific research
proposals which had been recommended for funding by the CEO of the ARC:
Interventions were made by at least four Ministers on at
least six occasions. These were: Ministers Nelson (2005, 2006), Birmingham
(2017, 2018), Tehan (2020) and Acting Minister Robert (2021).
Apart from the interventions of Minister Tehan, which were
for national security concerns, the recommended funding proposals were rejected
reportedly on the grounds of poor value for money. At face value, the rationale
of these interventions amounts to a lack of trust in the peer review process on
the part of the Minister of the day, given extensive processes involve
consideration of national benefit and value for money, alongside matters of
academic excellence, the strength of the project, and its likelihood of
success.[67]
The Review also described a lack of transparency in the
instances where funding proposals were rejected due to national security
concerns:
In 2020, 18 recommended funding proposals were referred to
security agencies owing to national security concerns, with the Minister
reserving his decision: 13 were eventually approved and 5 rejected. The actual
process by which the assessment of security issues was made and the grounds for
these grants being rejected was not clear in every case, inviting speculation
that this was potentially another form of political interference rather than
the proper exercise of ministerial oversight of national security.[68]
The use of the ministerial veto had led to frustration
among parts of the research community. In 2022, in a joint statement responding
to the then Acting Minister’s veto of 6 proposals, the Presidents of
Australia’s 5 Learned Academies stated:
When the integrity of Australia's research system is
compromised by perceived, or actual, political interference, there are real
costs to the research sector and indeed the nation - as trust is eroded and the
relationships researchers have with industry, the Australian community, and
international partners are damaged.[69]
Additionally, in 2022, two members of the CoE resigned
following the exercise of the veto by Acting Minister Robert. One of them,
Professor Andrew Francis, stated:
It’s very difficult to be committing a lot of time to a
process and asking other people to commit a lot of time and expertise they’ve
garnered over decades to make very difficult judgements, [and then] have
somebody who doesn’t know about the area make a snap judgement.[70]
The use of the ministerial veto also gained the attention of
the international research community, with an editorial in one of the premier
international science journals, Nature, arguing that the existence of
the veto could ‘undermine the integrity of Australian science’.[71]
Many university and research community stakeholders have
called for the adoption of the ‘Haldane Principle’ (or a similar principle) to
guide research funding decisions.[72]
The Haldane Principle provides that governments should set rules and structure
for research funding but that ‘decisions on individual research proposals are
best taken by researchers themselves through peer review’.[73]
ARC Review recommendations and the ministerial veto
The ARC Review recommended that grant approval powers (in
most instances) be transferred from the Minister to a proposed ARC board (Recommendations
5 and 6).[74]
The ARC Review considered that this would align with the research governance
processes in other comparable countries, stating:
[T]he Panel advises that the global gold standard is that
assessments of individual proposals must be based on expert review free of
political interference. For example, the European Research Council (ERC) is
composed of an independent Scientific Council, its governing body consisting of
distinguished researchers, and an Executive Agency, in charge of
implementation. This is enshrined in legislation in the United Kingdom and is
the practice in all leading research agencies around the world …[75]
The Review’s recommendation includes provision for the
Minister to direct the CEO to not fund, or recover funds from, a research
program if the Minister becomes aware of national security concerns related to
the program.[76]
In these cases, the Review proposed that the Minister notify Parliament and/or
the Parliamentary Joint Committee on Intelligence and Security.[77]
Ministerial veto powers as outlined in the Bill
The Bill proposes to transfer approval powers from the
Minister to the Board for grants other than those relating to designated
research programs.[78]
The Explanatory Memorandum states that this change will ‘strengthen the overall
integrity of the ARC funding system as the Board is expected to be best placed
to draw on the unique expertise within the College of Experts, and other Board
committees, to guide discreet strategic funding for programs’.[79]
In his second reading speech, the Minister stated that:
Over time [the requirement for the Minister to approve
grants] has allowed political influence to seep into what should be an
independent, peer reviewed process aimed at expanding our nation’s knowledge
base. The establishment of the board as the approving body will get the
politics out of this. It re-establishes peer review as the driving principle in
grant approvals.[80]
The approval and veto powers of the Minister, however, are
not wholly removed by the Bill. The Minister will retain powers relating to
funding decisions on individual applications:
- where the application is made for a grant under a designated
research program
- when the Minister has concerns related to the research program’s
impact on security, defence, or international relations.
Designated research
programs
Proposed section 48 outlines the process for the
approval of grants under designated research programs.[81]
For these programs, the Minister retains the power to approve applications
which must meet the requirements of the relevant funding rules. Although the
assessment process for these grants will be outlined in the rules, it is likely
that this will resemble the existing process (that is, peer review of
applications, followed by ARC recommendations and then approval by the
Minister).
The Bill inserts a new definition of designated
research program.[82]
Designated research programs are defined as meaning 3 existing grant
schemes within the Linkage Program:
- the ARC Centres of Excellence scheme
- the Industrial Transformation Training Centres scheme
- the Industrial Transformation Research Hubs scheme.[83]
Additional research programs may be specified by the
Minister in a legislative instrument.[84]
The Explanatory Memorandum does, however, note that the Minister will approve
‘grants for designated research programs to recognise their role in
creating research capability rather than programs that award individual
grants’.[85]
The ARC Centres of Excellence scheme aims to establish
‘prestigious focal points of expertise through which high-quality researchers
collaboratively maintain and develop Australia’s international standing in
research areas of national priority’.[86]
Relative to most ARC grant opportunities, the Centres of Excellence program
provides large grants, with successful applicants being funded for between
$1 million and $5 million every year for up to 7 years.[87]
Grant opportunities are conducted approximately every 3 years and in the 5
funding rounds to date between 9 and 13 applications have been funded per
round.[88]
The 2 other schemes sit within the Industrial
Transformation Research Program. This program seeks to support
‘university-based researchers and industry to work together to address a range
of priorities to transform Australian Industry’.[89]
The 2 schemes provide up to $1 million per year for up to 5 years.
The research hubs scheme focuses on partnerships with industry, while the
training centres scheme focuses on Higher Degree by Research and postdoctoral
training.[90]
Exemption for security, defence or international relations
The Bill provides the Minister with the power to refuse
funding (and recoup funding where necessary) if the Minister considers a
research proposal should not be funded for reasons relating to the security,
defence or international relations of Australia.[91]
Proposed subsection 55(1) specifies the matters the Minister must have
regard to when making such a decision:
- financial support from a foreign government body (para (a))
- association with international tertiary education institutions
(para (b))
- associations with foreign governments, foreign law enforcement
agencies, foreign military and intelligence agencies (para (c))
- association with countries under sanctions from the United
Nations or Australia (para (d))
- association with entities proscribed in accordance with the Autonomous
Sanctions Act 2011, which deals with persons and entities of
international concern (due to issues such as proliferation of weapons of mass
destruction or serious human rights abuses) (para (e))[92]
- association with persons or entities proscribed in accordance
with Part 4 of the Charter of the
United Nations Act 1945 (relating to terrorism or assets relating to
terrorism) (para (f)).[93]
The Minister may also ‘have regard to any other matters’
they consider appropriate.[94]
It is expected that applications for grant funding would
rarely engage with paragraphs (c) to (f). However, international collaborations
are widely encouraged across the research sector, permitted under many NCGP
schemes, and supported by a range of bilateral agreements.[95]
Moreover, the Bill amends the objects clause to provide that the ARC’s role
includes supporting Australian universities to conduct research in
collaboration with international partners.[96]
Thus, many applications may engage with paragraphs (a) and (b), noting that it
is the ‘nature and extent’ of the association that would need to be considered
by the Minister.
Arguably, the drafting of proposed section 55 still
allows the Minister a wide discretion to veto research proposals. Where the
Minister does exercise this discretion, the Minister is required to provide a
written statement of the decision to the Parliamentary Joint Committee on
Intelligence and Security and table a statement of the decision in both Houses
of Parliament.[97]
Revised funding arrangements
A move to annual appropriations
The ARC Act currently contains an annual funding
cap (section 49) that must be amended annually to ensure future funding for the
NCGP. The ARC Review noted that the annual Amendment Bill created an
administrative burden and can ‘complicate management of the NCGP, especially in
election years when the parliamentary calendar may be disrupted’.[98]
The Bill repeals and replaces the annual funding cap with
an annual appropriation to be made to the existing ARC Research Endowment
Account, as recommended by the ARC Review (Recommendation 9).[99]
This is consistent with arrangements for the funding of medical research from
the National Health and Medical Research Council’s Medical Research Endowment
Account.[100]
The Explanatory Memorandum notes that indexation based on the Consumer Price
Index will be applied to annual appropriations to the ARC Research Endowment
Account.[101]
The Bill also repeals section 50 of the ARC Act,
which required the Minister to split NCGP funding between different research
programs.[102]
In practice, this required the Minister to assign what proportion of NCGP
funding would be provided to each of the Discovery and Linkage programs. The
removal of this requirement was recommended by the ARC Review under the proviso
that a commitment to basic, investigator-led research be incorporated into the
purposes of the ARC Act (see discussion above).[103]
Formalising requirements for funding agreements
The ARC Act currently stipulates the conditions of
payment of financial assistance (section 58), and current ARC grant guidelines
state that in order to receive a grant, the administering organisation must
enter into a grant agreement with the Commonwealth (represented by the ARC).[104]
The Bill further formalises the funding process by repealing
and replacing section 58 with a new requirement for a funding agreement to
be made between the ARC and the research organisation receiving funding.[105]
This funding agreement comprises the ‘terms and conditions on which a
grant of financial assistance is to be made to an organisation’.[106]
The Bill also provides the ARC with the power to terminate
a funding agreement, cease funding and, if necessary, seek repayment of funds
in cases where there has been a breach of the terms and conditions of the funding
agreement.[107]
The ARC must also cease funding a research program if the
organisation is no longer involved or the lead researcher named in the
agreement is no longer leading the project.[108]
This suggests a varied or new funding agreement may be required if a
lead researcher transfers to a new institution. The ARC Review reported that
stakeholders:
questioned whether the requirements, for example to seek
formal ARC approval for minor changes to personnel or to record movement of
[Chief Investigators] between universities, merited the effort required. It
also appears that the ARC’s capacity to provide timely responses to reported
changes is overwhelmed.[109]
Transitional funding arrangements
The Bill allows for currently funded and approved research
programs to continue under the existing arrangements for 12 months after
the commencement of the Act.[110]
Following 1 July 2025, they will transition to new arrangements,
which will require a written funding agreement.[111]
Author acknowledgements: the authors thanks Dr Emily Gibson
for her peer review of an earlier version of this digest.