Science, research and innovation

Budget Review 2017–18 Index

Dr Alex St John

Support for science, research and innovation (SRI) is relatively stable overall in the 2017–18 Budget, with little change for most programs. The fanfare of the Turnbull Government’s signature National Innovation and Science Agenda has faded somewhat, with the initiatives announced in 2015 and 2016 having moved into the implementation phase. Although the overall picture for SRI will become clearer when the Science, Research and Innovation Budget Tables are released later in the year, most stakeholders will regard 2017–18 as business as usual. However, there are still a number of budget measures that will affect the SRI sector.

Higher education research

As part of the Government’s proposed higher education reforms (for further information see the article on higher education reform in the education section), universities are set to receive 2.6–2.9% less funding under the teaching block grants (the Commonwealth Grant Scheme), as the Government argues that universities’ growth in student revenue has greatly outpaced growth in costs of teaching degrees.[1] Although this appears unrelated to research, universities have historically relied on using some of their teaching block grant to cross-subsidise their research and infrastructure programs.[2] University groups have expressed concern that these reductions will reduce universities’ capacity to undertake ‘core activities’ of engagement and research as well as teaching.[3]

The Budget also announced that a Research Infrastructure Investment Plan would be developed on the back of the 2016 National Research Infrastructure Roadmap process.[4] No funds have been earmarked for new research infrastructure, and research sector lobby groups are continuing to campaign against uncommitted money in the Education Investment Fund being repurposed to the National Disability Insurance Scheme.[5] However, $26.1 million over four years has been earmarked to maintain optical telescopes in Australia, including moving ownership of the Anglo-Australian telescope from the Government to the research sector, and becoming a partner in the European Southern Observatory.

Government-sector research

Funding to Commonwealth research agencies has remained relatively stable for the 2017–18 Budget, with no significant increases or decreases to overall funding. Funding for the rural research and development corporations (RRDCs) should slightly increase, as the Budget introduces research and development levies on exported cotton, tea tree oil and thoroughbred mares.[6] The Budget also confirms continued funding for the year-round operation of the Antarctic research base on Macquarie Island.[7]

Medical research

The Budget contains a small number of highlights in medical research. New funds are made available for two targeted research areas – fighting childhood cancer and mental health. Under the Prioritising Mental Health initiative (for further information see the article on mental health in the health section), an additional $7.5 million will be provided in both 2017–18 and 2018–19, split between the National Centre for Excellence in Youth Mental Health, the BlackDog Institute and the Thompson Institute. This will add to the amount spent on mental health research by the National Health and Medical Research Council, which was $71.7 million in 2016.[8] Cancer Australia will receive $5.8 million over four years to accelerate two clinical trials of brain cancer treatments in Australia, and to increase capacity in diagnosis, treatment and research in childhood cancer.

Medical Research Future Fund (MRFF)

The MRFF, a sovereign endowment fund announced in the 2014–15 Budget, will make its first disbursements in 2017–18. These initial disbursements will amount to $65.9 million over four years, and will target cancer in teenagers, preventative health, and initiatives for rapid translation of research into treatment.[9] The level of disbursements is smaller than the initial projections of earnings from the fund; this reflects the delay in establishing the fund, which occurred in late 2015.[10] Budget papers indicate that the fund currently has a capital balance of $4.4 billion, with an additional $2.6 billion to be transferred to the fund this year.[11] If the fund is to achieve full capitalisation of $20 billion in 2020–21, transfers totalling approximately $13 billion must be made between 2018-19 and 2020-21.


A new initiative, the Advanced Manufacturing Fund, will be established with $101.5 million in funding over four years. The scope of the fund will be relatively narrow, with the following actions foreshadowed:

  • $24 million in grants to stimulate advanced manufacturing research projects
  • $47.5 million in matching funds for establishing and expanding high value manufacturing in South Australia and Victoria
  • $10 million to establish ‘Innovation Labs’ in South Australia and Victoria
  • $5 million to invest in student research to encourage continued training of automotive engineers
  • Reductions in import tariffs on prototype motor vehicles.[12]

The focus on South Australia and Victoria in these programs suggests that their intent is to offset the withdrawal of the car manufacturing industry in Australia, which will be completed in 2017.


The science, research and innovation measures announced in this year’s budget have received a relatively muted reception. Automotive and industry groups generally welcomed the advanced manufacturing package,[13] although some commentators have highlighted a lack of linkage to broader innovation and manufacturing policy.[14] Science and technology lobby groups welcomed the commencement of disbursements from the Medical Research Future Fund, tempered with disappointment that funding increases for the Australian Research Council and the National Health and Medical Research Council did not match inflation.[15]

[1].          S Birmingham (Minister for Education and Training), A stronger, sustainable and student-focussed higher education system for all Australians, media release, 1 May 2017.

[2].          J Lomax-Smith, L Watson and B Webster, Higher education base funding review: final report, October 2011, pp. 82-84; Universities Australia, The facts on university funding, April 2017.

[3].          Innovative Research Universities, Why universities need annual surpluses, media release, 3 May 2017; Group of Eight Australia, Go8 disappointed by Government’s response to Universities’ strong contribution to the Australian economy, media release, 2 May 2017.

[4].          Department of Education and Training (DET), 2016 National Research Infrastructure Roadmap, DET website, 12 May 2017.

[5].          Universities Australia, Uni cuts counter to jobs, growth & global competitiveness, media release, 9 May 2017.

[6].          The budget figures in this brief have been taken from the following document unless otherwise sourced: Australian Government, Budget paper no. 2: Budget measures.

[7].          Australian Government, Portfolio budget statements: budget related paper no. 1.17 Environment and Energy portfolio, p.20

[8].          National Health and Medical Research Council (NHMRC), Research funding statistics and data, NHMRC website, 28 March 2017.

[9].          Department of Health, First disbursements from the Medical Research Future Fund, Department of Health website, 9 May 2017.

[10].       See D Brett, ‘Science and research funding’, Budget review 2015–16, Research paper series, 2014–15, Parliamentary Library, Canberra, 2015.

[11].       Australian Government, Budget paper no.1: Budget strategy and outlook, p. 7-17; Australian Government, Budget paper no.4: Agency resourcing, p. 112.

[12].       Department of Industry, Innovation and Science (DIIS), Increased investment in advanced manufacturing, DIIS website.

[13].       I Willox (CEO, Australian Industry Group), Budget 2017: Clearing the decks for new tilt at growth, media release, 9 May 2017; Australian Automotive Aftermarket Association, AAAA welcomes Australian manufacturing development funding announcements in federal budget, media release, 10 May 2017.

[14].       D Evans, ‘Budget 2017: a glimmer of support for innovation and advanced manufacturing’, The Conversation, 11 May 2017.

[15].       Science & Technology Australia, From the 2017/18 federal budget lockup, media release, 9 May 2017; Australian Academy of Science, What the Budget means for science and research, media release, 9 May 2017; Association of Australian Medical Research Institutes, Elation as first MRFF payments announced in budget, securing health and medical research, media release, 9 May 2017; Research Australia, Federal budget 2017-18 | First grants issued by MRFF, media release, 9 May 2017.


All online articles accessed May 2017. 

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