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Calls grow for R&D focus

MORE money must be spent commercialising research and development projects, says Fractal Graphics managing director Nick Archibald.

Australian chief scientist Robin Batterham stated in his report The Chance to Change, that the nation was lagging in research and innovation and risked being left behind in the global transformation to new, knowledge-based economies.

Australia’s proportion of gross domestic product spent on R&D has dropped from 10 per cent two years ago to 1.5 per cent.

Dr Archibald said while R&D funding was “relatively well catered for” in Australia – albeit small in terms of per cent of Gross Domestic Product compared to other OECD countries – the issue of bottle-necking was more pressing.

“Of more than $8 billion spent on R&D to 1998, only $50 million has been spent on commercialising this R&D,” Dr Archibald said.

“The imbalance between R&D and commercialisation capital – the hourglass effect – has caused the Federal Government to set up the IIF scheme in an attempt to redress this.

“But one of the biggest problems Australia faces is that the IIF funds still have a ‘merchants bankers’ mentality and are solely market driven.

Hence they gravitate towards the mass markets and the casualties are the scientific niche market providers.”

A spokesman for Communic-ations, Information Technology and the Arts Minister Richard Alston said the recent call by the Innovation Summit Implement-ation Group for a rise in research and development tax concessions was not an efficient way to impact the progress of new industries such as IT.

To increase the growth and competitiveness of new technology firms, the ISIG’s final report Innovation – Unlocking the Future recom-mended doubling funding for the Federal Government’s Commercialising Emerging Technologies Program which supports early growth firms to maximise their potential to trade in new services and products.

“With the rate of change with which the industry is moving, it is better to leave this to the market,” the spokesman said.

“Raising cash through venture capital is more efficient and direct than looking to the Federal Government to allocate funds, so we are pushing the industry to embrace this approach.”

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