5 March 2009
Hotel Realm
Canberra, ACT
[check against delivery]
There is a trinity of curses attributed on dubious authority to the Chinese:
- May you live in interesting times.
- May you come to the attention of those in authority.
- May you find what you are looking for.
In my case, it’s two down, one to go.
Do the interesting times we are living in date from December 2006, when the first American sub-prime mortgage lender filed for bankruptcy?
Do they date from September 2008, when the collapse of Lehman Brothers transformed a trans-Atlantic financial crisis into a crisis for real economies around the world?
Do they date from 1979 or 1980, when the election of Margaret Thatcher and Ronald Reagan invested neo-liberalism with executive power?
These are questions for tomorrow’s historians.
My concern as a policy maker is less with when the current crisis began, than with how successfully we get through it.
Yesterday’s national accounts revealed that the Australian economy contracted half a per cent in the December quarter.
This is a very sobering result, but it also confirms that ours is one of the strongest economies in the developed world.
Every country in the G7 did worse in the December quarter.
So did the Euro zone.
So did other countries in our own region, including Singapore, South Korea and Taiwan.
Australia faces this crisis with several advantages, including a Government willing to do whatever it takes to shield the nation from its worst effects.
Labor is a social democratic party, and we believe the state has a legitimate and indispensable role to play in guiding the economy, building social and economic infrastructure, and redistributing wealth.
Until recently, these ideas were unfashionable.
Even now, they have their enemies.
But most people in most places have come round to the social democratic view of the state – at least temporarily.
They are no longer willing to believe that the market can right all wrongs.
Emeritus Professor Eric Hobsbawm says the global financial crisis is “the dramatic equivalent of the collapse of the Soviet Union: we now know that an era has ended”. (BBC, Today, 20 October 2008)
Dr Hobsbawm is a master historian, and one of my favourites.
At 91, he has seen and read more history than I ever will.
It was his memoir – Interesting Times: A Twentieth-Century Life – that got me thinking about Chinese curses.
Nevertheless, I think he may be overstating the case.
The era of unchallenged neo-liberal orthodoxy is certainly over, but it would be unwise to declare social democracy triumphant and history at an end – that’s the mistake the neo-liberals made.
What I believe we will see is a much more vigorous and inclusive debate about how we want to live, how we want our society to work, and how we want our future to look.
A debate not just about procedures, but about values.
All of our public institutions, including universities, will be shaped by this debate – just as they’ve been shaped by the free market ideas that have prevailed over the past three decades.
Which brings us back to the third curse – “May you find what you are looking for.”
If anyone out there has fired this one at me, I’m afraid it hasn’t quite worked yet.
What I’m looking for is a higher education system with the research capacity to solve our problems, expand our opportunities, and improve our lives.
Don’t get me wrong.
We have no shortage of outstanding researchers.
We have world-leading research capacity in many fields.
We are definitely part of the way there.
But we still have a long journey ahead of us.
It is a journey we have to make.
The cohesion of our society, the health of our democracy, the strength of our economy, the vitality of our culture, the preservation of our environment, and the happiness of our people all depend on it.
Announcements
Creating a university system that is equal to Australia’s needs and equal to the world’s best will require both cultural change and structural reform.
Julia Gillard gave us a foretaste of what that means at this conference yesterday.
Before I touch on the announcements she made, let me clear up one point.
Some have assumed that the new national regulatory agency Julia mentioned will be responsible for negotiating compacts.
This is incorrect.
There has been no change from the approach we outlined before the last election.
Each university will negotiate a compact with the Government defining its particular mission and describing how it will meet the government’s public policy objectives.
Our aim is to increase autonomy and diversity – not to increase red tape.
Compacts will be a tool for building partnerships between universities and governments – a tool for achieving our common goals.
In addition to announcing the regulatory agency, Julia also set a new target for undergraduate completions and outlined a new funding model based on student demand.
Each of these measures has a parallel on the research side.
Just as the regulator will guarantee institutional standards and performance, so Excellence in Research for Australia – better known as ERA – will guarantee research standards and performance.
Just as funds for teaching will be allocated on the basis of student demand, so funding for research must be based on demonstrated excellence and clear priorities that take into account national needs, individual curiosity, institutional capabilities, and the resources available.
And just as we have pledged to increase participation at the undergraduate level, so we are determined to increase our research effort.
Ideas
The question is, how?
Thanks to Professor Denise Bradley, Dr Terry Cutler and their colleagues, we have plenty of ideas to work with.
The House of Representatives Standing Committee on Industry, Science and Innovation has added a few of its own in a valuable report on research training and the research workforce.
Most of you will be familiar with these ideas, so I don’t propose to canvass all of them here.
What really interest me are the points on which they converge.
These are clearly core issues for universities and for the innovation system more generally.
Cutler, Bradley and the House committee all say that we need to build Australia’s human capital, and they make complementary recommendations on how to go about it.
This is the single most important thing we can do to boost our research and innovation effort, and to accelerate our economic and social development.
All three say the full costs of research must be addressed.
And all three say the term and value of Australian Postgraduate Awards should be increased.
Professor Bradley and the House committee also argue:
- for an increase in the number of Research Training Scheme places to meet future demand, and
- for measures to get more international students doing research degrees in Australia.
Similarly, Professor Bradley and Dr Cutler agree we must direct research and research training funds to higher education institutions that, in Professor Bradley’s words, “have appropriately qualified ... researchers and the capability to achieve an acceptable return on public investment” (Rec. 40).
Naturally, there are also differences.
Can we resource universities to do research in every one of their teaching fields, as Professor Bradley suggests?
Or should we resource them to offer higher degrees only in fields where they do outstanding research, as Dr Cutler proposes?
Yet even here there is common ground.
Both questions assume – correctly in my view – that institutions can’t train researchers in a given field if they don’t do research in that field themselves – and do it well.
Individual recommendations to one side, Professor Bradley, Dr Cutler and the House committee are in fundamental agreement on one point.
They all agree that things have got to change.
Track record
The Government shares this view, and we are already pursuing a vigorous reform agenda.
We have invested in new and improved university infrastructure through:
- the Better Universities Renewal Fund
- the Teaching and Learning Capital Fund for Higher Education, and
- the Education Investment Fund.
Our total investment to date is $1.58 billion, with more to come as we fast track round two of the EIF.
We have also expanded opportunities for researchers by introducing Future Fellowships, Australian Laureate Fellowships, and a new Australian Research Fellowship for Indigenous researchers.
We have promoted international engagement through the Australian Research Council, CSIRO, and the learned academies.
We have increased support for students, with:
- more Commonwealth Scholarships,
- more Australian Postgraduate Awards,
- HECS remissions and refunds for undergraduates studying in priority areas, and
- the $950 Training and Learning Bonus that forms part of the government’s Nation Building and Jobs Plan.
Strategic directions
This is a great start, but there is much more to be done.
The budget will be extremely tight, but that shouldn’t stop us rethinking what we want from this sector and how we can strengthen and renew it.
The Government’s response to the Cutler and Bradley reviews will detail a new approach to research funding, and measures to strengthen the contribution universities make to the national innovation system.
That contribution is already significant.
Universities do a quarter of Australia’s total research, including 84 per cent of our pure basic research and 82 per cent of our research in the humanities, arts and social sciences.
They prepare people for active citizenship and productive employment, and they train the research workforce.
They provide the intellectual fuel that drives the innovation system, ultimately making us more productive and more competitive.
How do we build on this foundation?
Research funding
For a start, I believe we need to look at the adequacy and design of research funding in the higher education sector.
The current model does not address the real costs of research, does not encourage collaboration, and does not equip us to meet emerging needs.
Research funding must be strategically targeted and sustainable.
It must help us build critical mass and maximise returns on our investment – not least by concentrating resources on the things we are best at – as institutions, and as a nation.
Research workforce
Second, I believe we need to expand and replenish the research workforce.
Australia only eight Australian workers in every thousand have a PhD.
In the United States, it’s eleven per thousand; in Germany, it’s twenty; and in Switzerland, it’s twenty-eight.
We are above the OECD average for researchers per thousand people in the workforce, but well behind the world’s best – including the Scandinavians, the United States, Japan, South Korea and New Zealand in the OECD, as well as non-OECD countries such as Singapore and Taiwan.
This research skill shortage is a problem for the economy as a whole, but the challenge is especially acute for this sector, with its ageing workforce.
Professor Graeme Hugo from the University of Adelaide tells us 40 per cent of the academic workforce is aged over fifty, and that “universities are likely to lose between a fifth and a third of their staff in the next decade or so”. (Hugo, 2008)
We clearly need to give more young people the preparation and support they need to train as researchers.
This will mean continuing to invest in school and undergraduate education to enlarge the pool of students qualified to pursue research careers.
It will mean continuing to monitor the incentives we offer our best and brightest to undertake postgraduate research.
Collaboration between sectors
Our third priority must be to improve connections between different parts of the innovation system.
Australia ranks last in the OECD for research collaboration between universities and industry.
Our goal is to turn that around.
The Enterprise Connect network of manufacturing and innovation centres we launched last year is a very important step in this direction.
Several centres are located in university precincts and all are building relationships with universities and other research organisations.
It is my pleasure to launch the latest Enterprise Connect program here today.
Researchers in Business will support the placement of researchers from universities and public research organisations in small and medium-sized Australian firms, where they will help to develop new ideas with commercial potential.
This is a $10 million program, and it will meet up to half of each researcher’s salary costs, up to a maximum of $50,000.
Researchers in Business is an election promise, but it is especially timely in the current climate.
It will boost both employment and business success through innovation.
We expect it to revolutionise the operations of the firms involved, but it will also be a great opportunity for researchers to add unique value in a business setting.
Universities and research organisations will receive a letter inviting them to take part in the next few days.
It will be Enterprise Connect’s job to marry researchers to businesses and administer the program, but it will rely heavily on intelligence from you.
Collaboration between universities
We also need to increase collaboration within the higher education sector itself.
This doesn’t just mean sharing more equipment and facilities.
It will also mean allowing staff and students more mobility.
It will mean building concentrations of activity and resources.
We should be mature enough to recognise that not everyone can be great at everything.
All researchers should have access to the best infrastructure and the best minds in their field, regardless of where they are based.
The hubs-and-spokes model I have championed for some years is one way we can democratise access to resources and put those resources to optimal use.
It is not about entrenching elite universities.
It is about promoting elite research – and for that I make no apology.
Excellence
Which brings us to what I believe should be our highest priority of all, and that is the pursuit of excellence.
It isn’t enough just to increase the quantity of research we produce – we also need to increase the quality.
And it isn’t enough to just go around telling ourselves how good we are – we need to measure ourselves objectively against the world’s best.
We must submit to the discipline of international competition.
We must be accountable.
That’s why ERA is so important, and why I want to see it fully operational sooner rather than later.
The future
The Government will respond to the Cutler and Bradley reviews as part of the budget process.
That response will be our base camp, but we will still have a long climb to the summit.
Our ultimate goal is a university research system that can mobilise innovation in every department of Australian life.
A system that can solve the problems that will still be with us long after the crash of 2008 has passed into history – not just the modern problems of climate change and energy security, but the perennial problems of disease and want.
A system that can make this country fairer, richer, greener, smarter and safer.
That’s what I’m looking for, and I sincerely hope I’m cursed to find it.