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Bridging the funding divide

A YAWNING chasm between the State’s research sector and its development counterpart appears to be the principal barrier to Western Australia securing a larger share of the national funding allotment.

And the State’s lack of a clear R&D or innovation strategy means the gap was likely to remain, for the near future at least.

That was the consensus among the 12 R&D stakeholders who gathered at a recent WA Business News boardroom luncheon.

The general position arrived at during the two-hour panel discussion was that the creation of a sturdy bridge would create a solid research and development industry, which would in turn attract significant research dollars. 

Most notable among the issues debated was the existence of a funding gap between research undertaken in WA institutions and projects that are commercially attractive to the venture capital industry.

This gap at the pre-seed level was one of several points raised as a significant missing link in the R&D bridge – meaning university research projects struggle to attract sufficient funding.

The panel said there was a lack of State planning on how to build an innovation strategy. Such a strategy should aim not only to look to close the funding gap, but to encourage collaboration between universities and between universities and industry.

Every other State besides Tasmania has a biotechnology strategy and, according to some panel members, Queensland was a shining example of how strategies for biotechnology and other core areas were paying dividends.

Possible solutions were raised and included concentrating on the State’s core areas of strengths and leveraging off those to generate further interest and further funding, both from government and industry.

However, this issue was hotly debated by university representatives and supporters of basic research who said cutting off funding to other areas would dry up an oasis of innovative ideas that, by chance, came out of pure research.

Teflon, for example, the product that coats most household frying pans, was a result of a scientific discovery by the NASA space program.

However, fund managers highlighted a lack of commercial focus and the universities were criticised for being too “academic centric”.

Also at issue was whether or not WA performed poorly in the latest Cooperative Research Centre funding round. If it did, why was this?

According to State Government representatives, WA clocked up its 10 per cent average because it was associated with programs, or was a node, to a CRC headquartered in another State.

University and industry representatives countered this point by saying that having the headquarters located in WA generated greater returns and, as a consequence, generated further funding.

While there were many issues debated there was a chorus of agreement that WA needs to develop an innovation strategy that fosters young entrepreneurs and helps bridge the funding divide.

In this special report WA Business News has divided the conversation into four key focus points: the funding gap – how do we close the chasm between university research and venture capital; the innovation strategy – why we need one; should that strategy involve catering only to our core strengths such as resources and agriculture; and CRCs, are we doing well enough?

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