Knowledge and Innovation: A policy statement on research and research training

2.         Competitive Research Schemes

New Knowledge, New Opportunities highlighted the need for a coherent policy framework for maximising the national returns to investment in research in Australian higher education. A basic premise of the discussion paper was that the research undertaken in Australian universities provides both private benefit and public good. Our universities and the researchers working within them should see themselves as active participants in national and regional development through the advancement of knowledge and its application to meet social needs through commercial means or public policy measures. The discussion paper proposed putting in place arrangements that would retain the strength of the higher education system in basic research while improving its contribution to the wider innovation system.

The Government confirms its commitment to the broad approach outlined in the discussion paper for sustaining national capability in basic research, strengthening the linkages between the different parts of the national innovation system, improving the management of research within higher education institutions and assuring the quality and effectiveness of the research training system. Changed arrangements for funding of research are designed to encourage a more strategic focus and to enable greater diversity of approach within the system. The Government believes this approach will ensure that Australia performs outstandingly in its chosen areas of research, and that the research effort is directed to areas where there are specific needs requiring attention at the national and/or regional level. This wider policy framework involves a broadening of public expectations of research with the potential for expanding the total national investment in research.

How the Government chooses to allocate the available resources, and to whom, becomes a critical factor in achieving the outcomes sought. The discussion paper proposed a dual system of funding for higher education research both to encourage institutions to be more flexible and responsive in developing a strategic portfolio of research activities and research training programmes, and to secure the benefits to be derived from the endeavours and achievements of individual researchers and teams.

Responses to the discussion paper endorsed this approach. There was strong support for a streamlined, comprehensive programme of peer-reviewed competitive grants administered by a restructured Australian Research Council (ARC), and a performance based system for block funding of universities for their research activities and to support the training of our next generation of researchers.

The Government is committed to the establishment of an independent and responsive ARC that is able to play a more strategic role in providing advice on the allocation of funding to researchers in the higher education sector and in other eligible research organisations to support the advancement of knowledge and maximise its contribution to the national innovation system. The Government wants to see the ARC further develop as a prestigious, nationally focused agency working effectively with members of the broad research community. In addition to its current advisory functions the Government sees the ARC contributing to national innovation by:

• helping to form and maintain effective linkages between the research sector and the business community, government organisations and the international community;

• developing and improving public understanding and appreciation of the contribution that research makes to the community; and

• reporting on the comparative performance of Australia with other research active countries and assessments of the national return on investment in research.

To this end the Government will establish the new ARC as an independent body within the Education Training and Youth Affairs (ETYA) portfolio supported by an Australian Research Council Act. The broad role and functions of the ARC proposed in the discussion paper were endorsed and will be incorporated in the new Act:

• an enhanced role in the provision of strategic advice to Government regarding research in the university sector;

• increased responsibility for the administration of research funding programmes for which funds will be appropriated under the new Act;

• a reformed governance and organisation structure reflecting the need to link university research with the innovation system;

• an enhanced capacity to identify and respond to emerging areas of research excellence; and

• an accountability framework emphasising transparency and performance.

The research community has largely welcomed the proposed reforms to the structure of the ARC and the administration of its new programmes. It was clear from the consultations on the discussion paper that Australian researchers are looking to the ARC for leadership. If it is to be effective in this role it is crucial that the ARC better reflect the diverse range of interests and perspectives necessary for a vibrant research system and internationally-competitive knowledge economy.

The Act will provide for a prominent member of the Australian community as a part-time chair of the Council. The person appointed to this position will be highly regarded in the research community.

The Chair will be supported by a Council membership which recognises that the research undertaken in our universities and other publicly-funded research institutions is an investment in the future economic and social well-being of the nation. The Act will therefore specify that the membership of the Council should reflect the breadth of academic, industry and community interests in the outcomes of research, including the Government perspective able to be brought by ex-officio participation of Secretaries of the ETYA and Industry Science and Resources (ISR) portfolios.

The Council needs to be assisted by a well-qualified, professional secretariat able to support the Council’s strategic advisory and programme management functions. The appointment of the chief executive officer (CEO) will be critical to the success of the new ARC. The Act will set out the criteria for the Government’s appointment to this position to be filled by a person with a distinguished record in research and research management.

The CEO will be responsible to the Council, including for the day-to-day management of the ARC, the development of strategic policy advice for the consideration of the Council and proper and efficient administration of its programmes. The person appointed will therefore be required to have a demonstrated track record of policy development skills and management at a senior level, able to balance the potential conflicts of interest latent in the dual responsibilities of policy development and programme administration.

Another important reform to the ARC will be the appointment of programme managers. Programme managers, working with a part-time expert advisory committee, would be visiting researchers with experience in research management, appointed for up to three years and with responsibility for:

• overseeing the conduct of the peer review process;

• integrating the views of external reviewers with the views of the advisory committee;

• liaising and communicating with the research community and users of research;

• identifying emerging disciplinary and cross-disciplinary developments and innovative approaches to research; and

• conducting forums and reviews of the state of Australian research in an international context.

However, because of their central role in the assessment processes for the allocation of grants, a number of submissions noted the need for more detail to be provided on the criteria for selecting the programme managers. The ARC Act will require that the programme managers will be selected on the basis of the excellence of their own research track record and their international reputation as well as their administrative capabilities.

The programme managers will be supported by their own expert readership base, which will give recognition to and support outstanding researchers individually and in teams. The readers will be selected from leading researchers in their field, including international experts. This will ensure that there is a stronger international perspective in the judgments made and go a long way to addressing long-held concerns in the sector about selection processes that, could sometimes, appear to be arbitrary.

As part of the development of a new ARC, the Government will put in place a better focused, more coherent and flexible competitive grants programme that will avoid the duplication and fragmentation of effort that is characteristic of the current arrangements. The new National Competitive Grants Programme (NCGP) will have two elements, Discovery and Linkage. It will provide grants to individuals, teams and centres for investigator-initiated proposals through an open national competitive process. A Centres of Excellence scheme, modelled on the Canadian experience, will span the Discovery and Linkage elements to support research requiring significant national and international collaboration.

Properly developed and managed, the new NCGP will ensure that researchers in Australian universities are equally recognised for their contribution to basic research as to outcome or applied research, and for the close links that they establish between these approaches.

The Discovery element of the NCGP recognises the importance of Australia’s universities as major sources of fundamental research, dedicated to the creation of knowledge, within a wider framework that encourages links with users of the research.

The Linkage element of the NCGP addresses many of the current impediments to national and international collaboration necessary for Australian research to contribute to a strong and vibrant knowledge economy. It should ensure better collaboration with researchers in other universities and across the innovation system. The Linkage element should create opportunities for complementarity and synergies with related programmes across other Commonwealth portfolios, including the Cooperative Research Centres (CRC) and R&D Start programmes, the Rural Research and Development Corporations and National Health and Medical Research Council development grants. It should also include scope to facilitate international linkages both with universities and industry.

For Australia’s research base to continue to meet our needs in a rapidly changing world, a framework is required that provides support for investment in research infrastructure of national or international significance. These facilities are generally of such a scale and cost that they are too expensive to be provided by any single research organisation and, in the case of very expensive facilities, by a single country. However, many different researchers and research organisations need access to them.

The Government believes that these facilities are most appropriately supported through collaboration involving consortia of research organisations, including overseas collaborators in the case of major international facilities. It accepts the view put to it during the consultations that it is therefore important to retain an identifiable component of the Linkage element of the NCGP to encourage individual universities to share infrastructure and facilities.

Enhanced strategic and management responsibilities for the ARC require an enhanced and transparent planning and accountability framework. Accountability of the Council to Government, through the Minister, is paramount.

The Council will bring forward each year, for Ministerial approval, a three-year rolling plan that outlines the objectives to be achieved over the triennium. Within the context of this plan, the Council will continue to make recommendations to the Minister on the allocation of funding across and within the schemes referred to the ARC. The Minister will consult other portfolio Ministers regarding whole of Government perspectives on the objectives for these schemes and mechanisms for enhancing their integration with Government priorities.

The ARC will publish an Annual Report to be tabled in the Parliament. The Council will also publish regular reports on the comparative performance of Australia with other research active countries, emerging developments within and across fields of research, and measures of the national return on investment in research. The ARC will also develop and implement a communications strategy to increase community awareness of the importance of research and the benefits derived from it.

The ARC and the Department of Education, Training and Youth Affairs (DETYA) will regularly evaluate and review programme parameters to ensure they reflect the most cost-effective way of using resources and research capability in the national interest. In programme management it will apply new technology and will adjust programmes from time to time to meet new and emerging needs.

The Government expects that a reformed and restructured ARC will serve as a peak forum for a diverse range of interested parties, make policy and funding recommendations to the Minister and ensure that accountabilities and external links are being well served. In framing its advice, the Council will have regard to guidance provided by the Minister on the Government’s overall economic, social and cultural objectives.

Much of the discussion in the consultations and in submissions focused on the mechanisms for ensuring a balance of research activities under the new NCGP. In particular, debate focused on four allied areas: the need to ensure that the proposed programme management structure in the ARC adequately reflects the importance of the humanities and social sciences, as well as basic and emerging (frequently cross-disciplinary) areas of research; the criteria and processes to be adopted for the assessment of grant applications and the conditions to be applied to grants; the need to ensure the continued strength of basic research while encouraging more ‘application-oriented’ research, in line with the greater emphasis placed on external linkages and collaboration; and the need to ensure smaller institutions would not be disadvantaged in a competition for a smaller number of larger value grants.

The Government believes that basic research serves as the foundation and catalyst to much commercial research and is a fundamental driver of innovation. The Government also recognises that our universities are the principal sites for basic research and that support for fundamental research must be sustained. At the same time, Governments have responsibilities to address social needs in cost-effective ways. It is a legitimate expectation that public investment in research will pay social dividends through contributions to problem-solving as well as providing commercial opportunities.

Clearly there are tensions in the establishment of priorities for research. These are more acute in a context of budgetary restraint. We need to strike an appropriate balance in research funding among national needs, institutional capacities and individual interests. In doing this, the Government is establishing a dual funding system of competitive research grants for individuals and their teams, awarded on merit, and block funding to institutions to give them flexibility to adapt to new opportunities and to set their own priorities. There remains an ongoing need for dialogue between all players in the research system, informed by strategic advice from the research granting councils, on the capability of the sector and emerging research needs. Through this process, the Government will, at times, signal matters for priority attention.

Within this framework, the new ARC Act will provide the Minister with the power to give guidance to the ARC on the broad direction of its research activities within the context of the strategic planning process, including determining the balance between the elements of the NCGP in the allocation of grants. This will also address concerns that budgetary constraints could see the funding of basic research decline. Furthermore, it will ensure that the processes for competition for grants are transparent, and allow for participation by all institutions. The current balance between basic and applied research would be maintained for the time being.

The Government seeks to establish a streamlined process for assessment of ARC grants. This is necessary to ensure that grants go to applicants and projects of the highest quality cognisant of the international credibility of the Australian grants system. The programme management structure and the procedural reforms outlined in the discussion paper to the assessment processes for ARC grants will take time to develop and refine. The Government is keen to provide researchers as soon as possible with the advantages of funding predictability as a result of more frequent grant rounds, and the increased stability provided by five-year grants. The Government would like to see these approaches developed along with the new NCGP being introduced in 2001. This will ensure adequate time for the ARC to recruit high-calibre candidates to its programme manager positions and to restructure its operations in light of its more strategic role.

Meanwhile, the Government intends to proceed with the transfer of responsibilities for administration of the existing peer reviewed programmes from DETYA to the ARC with effect from the beginning of 2000.