A big issue was how Australians invest their savings.
“When you build up a wealth base in Australia, you go and invest it in real estate, when in other economies you go and invest in start-up companies and in tech,” Dr Hajkowicz said. “We’re a bit lazy with our capital. We don’t really put it to work.”
‘A maker, not a taker’
Part of the reason for that was that Australians haven’t had to.
When the global financial crisis was shocking other countries into doubling down on research and development more than a decade ago, “high commodity prices inoculated us from the worst shocks, so we didn’t invest enough in innovation, R&D and tech capability at the time”.
Dr Hajkowicz was “hopeful” Australian superannuation funds would start to invest more heavily in areas such as climate technology, “but most super funds haven’t really gone into areas of deep tech and new tech enough”.
“It’s not where they would want to put everything, but you would expect their portfolios to have quite a significant amount of activity at that high-risk, high-return end, which is new product development, R&D and venture capital.”
He said that while the financial crisis didn’t shock Australia into changing its attitude to R&D after the 2012 report, the coronavirus pandemic might this time round.
The nation was so exposed to sovereign capability risk and global supply chain failure that there might be little choice but to become “a maker, not a taker”.
CSIRO chief executive Larry Marshall also decried Australia’s relentless failure to capitalise on its innovation potential.
“When was the last time Australia caught a really big wave?” Dr Marshall asked in an opinion article published in The Australian Financial Review online.
“Thirty years of uninterrupted growth hasn’t motivated us to innovate and find new waves of prosperity to lead. We’ve fallen behind while others are racing ahead.
“While investment in research and development in Organisation for Economic Co-operation and Development countries and Asian economies such as China and South Korea has been going up, Australia’s investment has been going down over decades.
“We have a world-class research sector capable of incredible invention, but we remain well below the OECD average on commercialisation.”