Supplementary Report from the Australian Labor Party
1.1       
Labor Senators support the establishment of the Medical Research Future
Fund as an opportunity to expand Australia's health and medical research
sector, especially in that it provides an opportunity to implement some of the
recommendations of the McKeon Review - Strategic Review of Health and
Medical Research – Better Health through Research.
1.2       
Labor Senators particularly welcome the opportunity to pursue McKeon's
recommendations to imbed research in the health system, and to create a new
structure to define strategic research that supports a range of strategic
topics.[1]
1.3       
Labor Senators however see the MRFF as a missed opportunity to pursue
many of these recommendations due to the rushed and poorly developed proposal
the Government has developed, giving no consideration to McKeon's
recommendations to attract philanthropy and new funding sources, or indeed
define the recommendations in the original Bill.
1.4       
Labor Senators support the principle that disbursements from the Medical
Research Future Fund should be administered through a new committee under the
existing National Health and Medical Research Council committee structure.  In
this respect the Bills do not even meet the Government's own stated policy in
announcing the Fund that 'Fund earnings will be directed to medical
research, primarily by boosting funding for the National Health and Medical
Research Council' [2]
The need for an independent process of expert review
1.5       
Labor Senators acknowledge the internationally respected and transparent
processes the NHMRC has established over more than 80 years and believe these
existing mechanisms establish the best process through which the highest
quality health and medical research can be funded through MRFF disbursements.  
1.6       
Labor Senators agree that the types of research that should be funded
through MRFF disbursements is different from what the NHMRC has traditionally
funded, especially when it comes to commercialisation and translational
research.  Labor Senators also recognise that through the NHMRC's existing
committee structures this capacity is lacking which is why  Labor Senators
support the development of a the Australian Medical Research and Innovation
Strategy and the Australian Medical Research and Innovation Priorities. 
1.7       
Labor Senators do not agree that decisions regarding the projects and
programs awarded funding should sit wholly with the Minister of the day.  This
is inconsistent with the way existing grants are awarded by the NHMRC and
inconsistent with international best practice in awarding grants to the highest
quality projects based on a process of peer review.
1.8       
Labor Senators support the Australian Medical Research and Innovation
Strategy and the Australian Medical Research and Innovation Priorities as the
basis for disbursements from the MRFF only when a process of independent peer
or expert review is followed consistent with the processes already established
through the NHMRC.
1.9       
Labor Senators believe that establishing a new process entirely
independent from the NHMRC has the potential to undermine the NHMRC as the
preeminent, independent, independent institution from which Governments takes
advice about health and medical research and health and medical research grants
funding is administered.  Duplicating this process is also likely to be costly
and inefficient.
1.10     
In evidence to the Committee, NHMRC CEO Professor Anne Kelso
acknowledged that a number of existing organisations, including Cancer
Australia, utilised the NHMRC to undertake peer review and provide ranked
recommendations.  Specifically, Professor Kelso provided evidence that:
  That is a really excellent way of reducing the enormous cost
    of setting up new committees and drawing on the same pool of researchers to
    provide the advice in reviewing applications. I think it has been a very
    efficient process over some years now.[3]
1.11     
  Labor Senators do not support a discretionary funding mechanism through
  which the Minister for Health of the day can allocate funding based on a broad
  set of parameters – as defined by contested and inadequate definitions of 'medical
  research' and 'medical innovation' – as well as whether they agree with the
  recommendations of the Australian Medical Research Future Fund Advisory Board
  or not.
1.12     
Labor Senators do not support the transfer of existing funds within the
Health and Hospitals Fund transferring to the MRFF on the basis that this Fund
was established for different purposes from which the MRFF should exist and
administer disbursements.
The majority of stakeholders recognise that the role of the NHMRC should be
formalised in the final Bill
1.13     
The position of Labor Senators is supported by the Australian Society
for Medical Research that supports a subcommittee existing within the existing
NHMRC structure, specifically that:
  We have said a subcommittee could exist under the research
    committee. The research committee brings in some additional things which were
    not included in the advisory Medical Research Future Fund group, and that is
    consumer involvement and Indigenous researchers and clinicians. Also, if it sat
    underneath the NHMRC Research Committee umbrella, you would avoid duplication.
    What we do not want is the same types of research being duplicated in what is
    already funded within NHMRC. This is to add value to the current system. By
    having them in the same room, they are already talking about the national
    research strategies for the country—that is part of NHMRC's Research Committee
    profile; that is what they do—and all of the different expertise that was
    recommended for the advisory committee is there. I would say that they could
    emphasise some additional expertise in terms of commercialisation and some
    industry type people and financial people around the table, but that could
    still sit under the umbrella[4]
1.14     
  The former CEO of the NHMRC, Professor Warwick Anderson AM, now the
  Secretary-General of the International Human Frontier Science Program
  Organization, supports an MRFF Advisory Committee setting the strategy for the
  MRFF and the NHMRC administering the majority of the funding.  Specifically,
  Professor Anderson submitted evidence that: 
- 
When judging how to use public
money for research, only peer review can identify what is valuable and what is
not. 
- 
NHMRC’s almost 80 years of
effective, ethical and efficient service to the Australian community means that
public trust in the MRFF will be maintained if NHMRC plays the major role in
administering the earnings of the Fund in accord with the Advisory Board
Strategy. 
- 
NHMRC’s current Act allows simple
and recently established ways to proceed, if the MRFF funds are provided to
NHMRC outside the NHMRC’s Medical Research Endowment Account (as is the case
for the current Government Dementia Research Initiative). 
- 
Coordination between the MRFF and
NHMRC will be essential if the greatest good is (to) be gained from the MRFF
for the benefit of Australia.[5]
1.15     
The submission from Universities Australia supported a more formal
interaction between the NHMRC and MRFF.  Universities Australia noted that: 
  Extensive consultation and ongoing monitoring is necessary to
    ensure the MRFF achieves the goals outlined by the Australian Government. In
    particular, the interaction between the NHMRC and the operation of the MRFF
    needs to be carefully considered, so that existing linkages, infrastructure,
    expertise and support systems are drawn on to maximise the positive impacts
    from the system as a whole.[6]
1.16     
  Group of Eight also welcomed the need for independent expert review,
  submitting that:
  The Go8 urges the Senate to include the need for independent
    expert review or advice as part of the process of distributing funds from the
    MRFF. Independent expert review represents international best practice in the
    allocation of scarce funding, and should be included in the selection and
    allocation of project funding from the MRFF. Independent expert advice should
    be sought in other instances.[7]
  
1.17     
  Professor John Zalcberg OAM, representing the Australian Clinical Trials
  Alliance provided evidence that:
  With respect to the discussion around peer review and the
    application of the strategies and priorities, we agree that expenditure for the
    MRFF should be supported by a strong business case that considers how the
    financial assistance provides greatest value to Australians. However, we
    recommend that the legislation should include a mandatory process for peer
    review to assess each business case—at the moment, it does not require that it
    is a mandatory process of peer review—as well as provide the health minister of
    the day with independent assessment of the quality of the science of the
    rationale for the proposal, of the potential to lead to improvements in health
    outcomes and/or cost savings, which can be both short and long term, and the
    expected return on investment.[8]
1.18     
  Professor Rosalie Viney, President of the Australian Health Economics
  Society also agreed for the need for some sort of peer review process and noted
  that different forms of this process exist already depending on the kinds of
  research being considered:
  It is important to note too that there are different models
    of peer review that can operate and even within organisations such as NHMRC and
    ARC there are different models that operate. So it may be that some of the
    issues are around the model of peer review that is the best for the Medical
    Research Future Fund in terms of perhaps having shorter expressions of interest
    that then lead to the development of a fuller proposal as a more effective way
    of being able to streamline the process of peer review.[9]
1.19     
  Professor Robert K Shepherd, the Director of the Bionics Institute of
  Australia provided evidence that the MRFF should include a process of peer
  review from a commercial, industrial review perspective:
  the inclusion of a peer review from a commercial, industrial
    experience perspective. At the moment the only commercialisation program within
    the NHMRC is a development grant, which receives less than one per cent of the
    overall NHMRC funding. So there is very little funding going into the
    commercialisation of medical products through NHMRC at the moment, but the
    development grant process is very well reviewed and it is well reviewed
    commercially as well.
  I really think strongly that we should also be encouraging
    industry to feed back into what is important for industry in terms of
    performing research so that they could co-invest in projects. Co-investment is
    not performed in the NHMRC review process but it is performed in the ARC
    linkage process where ARC linkage grants also leverage approximately 30 per
    cent cash contribution from commercial partners. This, I think, is a real
    opportunity within the future research fund to include that.
  In Australia, two-thirds of PhDs are working in universities
    and one-third in industry. It is the reverse in Switzerland and the UK. We need
    to ensure that we engage industry with academic research and having a leveraged
    funding system would certainly help the engagement.[10]
1.20     
  Labor Senators do support the establishment of the MRFF but will seek to
  make a number of amendments to the Bills to establish a more robust assessment
  process.  Labor's amendments establish the inclusion of a process of expert
  review to ensure that the highest quality research is rewarded, rather than –
  potentially politically motivated and influenced by the 'loudest voices' -
  decisions being made by the minister of the day and subject to no independent
  oversight and with little transparency.
1.21     
A Labor Government would seek to amend the NHMRC Act to ensure that,
whilst the MRFF Special Account were to remain independent, the role of any
MRFF advisory committee would be reflected in the NHMRC Council structure with
the same sort of rigour applied to funding assessment as the NHMRC does through
its existing grants streams.
Senator the Hon Jan McLucas
			
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