BILLS DIGEST NO. 117, 2017–18              15 June 2018

Australian Research Council Amendment Bill 2018

Dr Emily Hanna
Science, Technology, Environment and Resources Section 

Date introduced: 10 May 2018

House:  House of Representatives

Portfolio: Education and Training

Commencement: The whole Bill commences the day after Royal Assent.

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through the Australian Parliament website.

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the Federal Register of Legislation website.

All hyperlinks in this Bills Digest are correct as at June 2018.

Purpose of the Bill

The purpose of the Australian Research Council Amendment Bill 2018 (the Bill) is to amend the Australian Research Council Act 2001 (the Act) to apply indexation to the appropriation amounts for approved research programs for the three financial years from 1 July 2017 to 1 July 2019 and insert funding caps for two new financial years (starting on 1 July 2020 and 1 July 2021).

Background

The Australian Research Council (ARC) is an independent Commonwealth body which was established in 2001 through the Act.[1] As the main Commonwealth research support body, it aims:

… to grow knowledge and innovation for the benefit of the Australian community through funding the highest quality research, assessing the quality, engagement and impact of research and providing advice on research matters.[2]

The ARC is the Government’s main source of advice on investment in Australian research as well as providing the Government with advice on general research issues. The ARC also provides evaluation of research through Excellence in Research for Australia (ERA).[3] ERA ‘identifies and promotes excellence across the full spectrum of research activity in Australia’s higher education institutions’, including through comparison with international benchmarks.[4]

The ARC administers funding for both primary and applied research in all areas through the National Competitive Grants Program (NCGP; however, the majority of medical research funding is administered through the National Health and Medical Research Council). There are currently two programs in the NCGP: the Discovery and Linkage Programs. The Discovery Program focuses on research by individual researchers and small teams of researchers while the Linkage Program encourages research ‘links’ between higher education institution researchers and industry, business and other research partners.[5] The grants are awarded competitively through a peer assessment process.[6]

The Act provides the financial assistance required for the ARC to administer the NCGP. It does this by providing annual funding caps for the approved research.[7] The Explanatory Memorandum states that applying indexation to appropriation amounts and inserting funding for additional years are ‘essential as the ARC Act is the legislative basis that supports the financial operations of the ARC research programs through special appropriation mechanisms which must occur each financial year’.[8] The Bill therefore supports the continued funding of ‘high-quality research needed to grow knowledge and innovation for the benefit of the Australian community’.[9]

Committee consideration

Senate Standing Committee for Selection of Bills

At the time of writing, the Senate Selection of Bills Committee had deferred its consideration of the Bill to the next Committee meeting.[10]

Senate Standing Committee for the Scrutiny of Bills

At the time of writing, the Senate Standing Committee for the Scrutiny of Bills had not reported on the Bill.[11]

Policy position of non-government parties/independents

At the time of writing, non-government parties and independents do not appear to have commented on the Bill.

Position of major interest groups

The indexation of the funding for the ARC Discovery and Linkage Programs has been welcomed by science bodies. The Australian Academy of Science stated it was ‘[a] welcome return to indexation of ARC Discovery and Linkage schemes after several years of flat funding’.[12] Kylie Walker, Science & Technology Australia CEO, also welcomed the ‘return to keeping pace with CPI…for the Australian Research Council’.[13]

Financial implications

The Bill results in an additional appropriation of approximately $1.6 billion over five years from 1 July 2017.[14] The additional appropriation does not affect the substance of the Act nor give extra money to a Government department; it only adds to the special appropriation administered by the ARC for the purpose of funding research. The proposed changes in funding are in Table 1.

Table 1: proposed changes in appropriation caps

Financial year (starting date)

Current Appropriation Cap ($)[15]

Proposed Appropriation Cap ($)[16]

1 July 2017

746,852,000

758,055,000

1 July 2018

736,179,000

759,925,000

1 July 2019

747,812,000

771,932,000

1 July 2020

-

771,932,000

1 July 2021

-

771,932,000

Sources: Australian Research Council Act 2001, section 49; Australian Research Council Amendment Bill 2018, item 2.

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.[17]

Parliamentary Joint Committee on Human Rights

At the time of writing, the Parliamentary Joint Committee on Human Rights had not yet considered the Bill.[18]

Key issues and provisions

Schedule 1 contains two items. Part 7 of the Act covers research funding, with Division 1 of Part 7 outlining financial assistance for approved research programs. Section 48 of the Act then contains the years to which Division 1 applies. Item 1 inserts two proposed paragraphs at the end of subsection 48(2) of the Act. Proposed paragraph 48(2)(q) adds the financial year starting 1 July 2020 while proposed paragraph 48(2)(r) adds the financial year starting 1 July 2021. This means that Division 1 of Part 7 of the Act will apply to the additional financial years.

Item 2 of the Bill relates to section 49 of the Act, which specifies annual caps on the total approved amounts of research funding. Item 2 repeals paragraphs 49(r), (s) and (t), which contain funding caps for the financial years beginning 1 July 2017, 1 July 2018 and 1 July 2019, respectively. It substitutes these with proposed paragraphs 49(r)–(v), which provide new funding caps for the five financial years starting 1 July 2017 through to 1 July 2021, respectively. The funding cap amounts are detailed above in the ‘Financial implications’ section. In the second reading speech for the Bill, the Assistant Minister for Vocational Education and Skills, Karen Andrews, stated that the increase to funding caps in the Bill for the three financial years from 1 July 2017 to 1 July 2019 are ‘in line with inflation’.[19]

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[1].              Australian Research Council Act 2001, section 5.

[2].              ARC, ‘Welcome to the Australian Research Council website’, ARC website, last modified 23 October 2017.

[3].              Ibid.

[4].              ARC, ‘Excellence in Research for Australia’, ARC website, last modified 18 April 2018.

[5].              ARC, ‘Welcome to the Australian Research Council website’, op. cit.

[6].              ARC, ‘Peer review’, ARC website, last modified 3 February 2017.

[7].              Australian Research Council Act 2001, section 49.

[8].              Explanatory Memorandum, Australian Research Council Amendment Bill 2018, p. 2.

[9].              Ibid.

[10].              Senate Standing Committee for Selection of Bills, Report, 5, 2018, The Senate, Canberra, 10 May 2018, p. 4.

[11].              Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 5, 2018, The Senate, 9 May 2018.

[12].              Australian Academy of Science, Good outcomes for science in Budget 2018, media release, 8 May 2018.

[13].              Science & Technology Australia, STEM a standout winner in this year’s budget, media release, 8 May 2018.

[14].              Explanatory Memorandum, Australian Research Council Amendment Bill 2018, p. 3.

[15].              Australian Research Council Act 2001, section 49.

[16].              Australian Research Council Amendment Bill 2018, item 2.

[17].              The Statement of Compatibility with Human Rights can be found at page 4 of the Explanatory Memorandum to the Bill.

[18].              Parliamentary Joint Committee on Human Rights, Human rights scrutiny report, 4, 8 May 2018.

[19].              K Andrews, ‘Second reading speech: Australian Research Council Amendment Bill 2018’, House of Representatives, Debates, (proof), 10 May 2018, p. 9.