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Australian Budget Brings Unexpected Good News

Australia’s government plans to boost investment in science and innovation by about 25%, surprising a scientific community bracing itself for savage cuts amid the global economic downturn. The increase, announced in the federal budget released on Tuesday, takes the outlay for science and innovation from U.S. $5.3 billion (A $6.9 billion) in the current 2008–09 budget to U.S. $6.6 billion (A $8.6 billion) in the 2009–10 financial year. (The Australian financial year runs from 1 July.)

The rise comes despite a big drop in government revenue as the global financial crisis deepens. Scientists and science policy experts in Australia attribute the unexpected fillip in part to the completion of reviews of the national innovation system and universities commissioned by the Australian Labor Party government soon after it came to power in late 2007. The government agreed to adopt many of the recommendations of the reviews, and some of the new money will be directed toward those goals.

Many credit the hard-nosed and politically astute Innovation, Industry, Science and Research Minister Kim Carr with the surge in funding. “Paradoxically, in times of crisis, there are often more opportunities for fundamental reform, which have been grasped by the Australian government,” said Ken Baldwin, president of the Federation of Australian Scientific and Technological Societies.

Kurt Lambeck, president of the Australian Academy of Science, said the 25% budget increase was “substantial at a time of restraint." He continued, "It indicates that the government has finally recognized the importance of science and technology. ... It [the budget] really goes out of its way to start repairing the consequences of a decade of neglect. Although some of the funding might not flow through for a few years, the framework is there.” However, Lambeck is worried about a focus on “material infrastructure,” i.e., facilities and equipment rather than personnel. “My concern is whether we are going to have the people to make creative use of this infrastructure.”

The government boasted that in a “superscience” initiative, it will, over the next few years, direct more than $1 billion in Australian dollars toward fields such as space science and astronomy, marine and climate science, and biotechnology and nanotechnology. Among other new measures, the government will give universities U.S. $391 million (A $512 million) over 4 years to help meet some indirect research costs, including salaries of support staff. The funding gap between direct and indirect costs has been a long-standing problem in Australian universities. “This brings federal government support for the indirect costs of research from just over 20 [Australian] cents in the dollar to around 50 cents, in line with practice overseas,” said Baldwin.

Baldwin also welcomed the creation of 50,000 new university student places by 2013. “The budget addresses the need to invest in human capital through the higher education sector at a time when the creation of highly skilled jobs is an important investment on the road to recovery from the world economic recession,” he said.

Among government science agencies, the Commonwealth Scientific and Industrial Research Organisation got an extra U.S. $33 million (A $43 million) in direct funding for the next financial year. It also received funding for a new deep-ocean research ship.

The Australian government moved to boost business investment in research and development through tax-reform measures, including a 45% refundable tax credit for companies with an annual turnover of less than U.S. $15 million (A $20 million) and a new institute to speed up commercialization.