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1301.0 - Year Book Australia, 2004  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 27/02/2004   
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Contents >> Science and innovation >> Expenditure and human resources devoted to R&D

The ABS defines research and development (R&D) as systematic investigation or experimentation involving innovation or technical risk, the outcome of which is new knowledge, with or without a specific practical application, or new or improved products, processes, materials, devices or services.

Statistics on the amount of expenditure and human resources devoted to R&D in the business sector are collected annually through a survey of all likely R&D performers. Comparable statistics on the higher education, government (national and state/territory) and private non-profit sectors are collected biennially.

Tables 25.1 and 25.2 summarise the latest statistics available. The data show that after increasing by only 2% in the period 1996-97 to 1998-99, gross expenditure on R&D increased by 16% from $8,940m in 1998-99 to $10,344m in 2000-01. All sectors showed an increase in R&D expenditure compared with 1998-99.

25.1 EXPENDITURE ON R&D

1996-97
1997-98
1998-99
1999-2000
2000-01
2001-02
Sector
$m
$m
$m
$m
$m
$m

Business
4,234.7
4,221.1
4,094.7
4,112.4
4,917.4
5,545.5
Government
Commonwealth
1,266.6
n.a.
1,207.1
n.a.
1,424.8
n.a.
State/territory
797.7
n.a.
862.8
n.a.
943.6
n.a.
Total
2,064.3
n.a.
2,070.0
n.a.
2,368.4
n.a.
Higher education(a)
2,307.6
n.a.
2,555.1
n.a.
2,774.6
n.a.
Private non-profit
185.8
n.a.
220.1
n.a.
283.2
n.a.
Total
8,792.4
n.a.
8,939.9
n.a.
10,343.5
n.a.

(a) Data for the calendar year ending within the financial year shown.
Source: Research and Experimental Development, All Sector Summary, Australia (8112.0); Research and Experimental Development, Businesses, Australia (8104.0).

25.2 HUMAN RESOURCES DEVOTED TO R&D

1996-97
1997-98
1998-99
1999-2000
2000-01
2001-02
Sector
’000 person years
’000 person years
’000 person years
’000 person years
’000 person years
’000 person years

Business
26.4
24.8
25.1
26.5
28.3
30.4
Government
Commonwealth
10.4
n.a.
9.5
n.a.
9.7
n.a.
State/territory
8.8
n.a.
9.2
n.a.
8.7
n.a.
Total
19.2
n.a.
18.7
n.a.
18.4
n.a.
Higher education(a)
42.7
n.a.
45.5
n.a.
46.3
n.a.
Private non-profit
2.4
n.a.
2.5
n.a.
2.7
n.a.
Total
90.7
n.a.
91.8
n.a.
95.7
n.a.

(a) Data for the calendar year ending within the financial year shown.
Source: Research and Experimental Development, All Sector Summary, Australia (8112.0); Research and Experimental Development, Businesses, Australia (8104.0).

Expenditure on R&D - how does Australia compare internationally?

The most commonly used indicator for comparison purposes is the ratio of expenditure on R&D to gross domestic product (GDP). As table 25.3 shows, in 2000-01 Australia's R&D expenditure was 1.53% of its GDP, ranking it below Sweden (3.65%), Finland (3.40%), Japan (2.98%), Iceland (2.77%), United States of America (2.72%), Republic of (South) Korea (2.65%), Switzerland (2.63%), Germany (2.49%), Denmark (2.19%), France (2.18%), Belgium (1.96%), the Netherlands (1.94%), Canada (1.87%), the United Kingdom (1.85%), Austria (1.84%) and Norway (1.65%).

In terms of business enterprise R&D, Australia's ratio of R&D expenditure to GDP (0.72%) is again below the ratios for the industrialised countries referred to earlier, and is also below the rates for the Czech Republic and Ireland.

For government sector R&D as a percentage of GDP, Australia ranks higher. An R&D to GDP ratio of 0.35% places it fifth in the group of Organisation for Economic Co-operation and Development (OECD) member countries, behind only Iceland (0.71%), France (0.38%), New Zealand (0.37%) and Finland (0.36%). Government sector R&D as a percentage of GDP is much higher for Australia than for the United States of America, Canada or the United Kingdom.

For the higher education sector, Australia ranks in the top half. With an R&D to GDP ratio of 0.41%, Australia ranks behind Sweden (0.78%), Finland (0.61%), Switzerland (0.60%), the Netherlands (0.57%), Canada (0.55%), Norway (0.47%), Belgium (0.47%), Iceland (0.45%), Japan (0.43%) and Denmark (0.43%).

25.3 EXPENDITURE ON R&D AS A PERCENTAGE OF GDP, OECD countries - 2000-01

Business
Government
Higher education
All sectors(a)
Country
%
%
%
%

Sweden(b)
2.74
0.12
0.78
3.65
Finland
2.41
0.36
0.61
3.40
Japan
2.11
0.29
0.43
2.98
Iceland
1.56
0.71
0.45
2.77
United States of America
2.04
0.18
0.38
2.72
Korea, Republic of (South)
1.96
0.35
0.30
2.65
Switzerland
1.95
0.03
0.60
2.63
Germany
1.75
0.34
0.40
2.49
Denmark(b)
1.42
0.32
0.43
2.19
France
1.37
0.38
0.41
2.18
Belgium(b)
1.40
0.06
0.47
1.96
Netherlands
1.11
0.25
0.57
1.94
Canada
1.09
0.22
0.55
1.87
United Kingdom
1.21
0.22
0.38
1.85
Austria
n.a.
n.a.
n.a.
1.84
Norway(b)
0.92
0.25
0.47
1.65
Australia
0.72
0.35
0.41
1.53
Czech Republic
0.80
0.34
0.19
1.33
Ireland
0.83
0.09
0.23
1.15
Italy
0.53
0.20
0.33
1.07
New Zealand(b)
0.31
0.37
0.35
1.03
Spain
0.50
0.15
0.28
0.94
Hungary
0.36
0.21
0.19
0.80
Portugal
0.22
0.19
0.29
0.79
Poland
0.25
0.23
0.22
0.70
Greece(b)
0.19
0.15
0.33
0.67
Slovak Republic
0.44
0.17
0.06
0.67
Turkey
0.21
0.04
0.39
0.64
Mexico(b)
0.11
0.19
0.11
0.43

(a) Includes private non-profit.
(b) Data for 1999-2000.
Source: OECD, 'Main Science and Technology Indicators, 2003/1'.

Source of funds for expenditure on R&D

In 2000-01, the business sector funded 46% of all Australian expenditure on R&D. This compares with 41% recorded in 1990-91. The Australian (Commonwealth) Government funded 38% of R&D in 2000-01 (down from 44% in 1990-91) and the state and territory governments funded 8% (down from 11% in 1990-91).

In 2000-01, 92% of funding for R&D carried out by businesses came from the business sector (down from 95% in 1990-91). Commonwealth Government organisations provided 3% of funding for business R&D expenditure in 2000-01.

About 85% of Commonwealth Government sector R&D was funded by Commonwealth Government organisations in 2000-01. The Commonwealth Government proportion of self-funding has dropped from 91% 10 years ago.

About 69% of state government expenditure on R&D was funded by state government organisations in 2000-01. This is significantly lower than a decade earlier, when the proportion was 79%.

About 86% of higher education R&D funding in 2000-01 came from the Commonwealth Government (compared with 89% in 1990-91). Business enterprises provided 5% of the funding in 2000-01, up from 2% a decade earlier.

Commonwealth Government organisations funded 26% of the R&D of the private non-profit sector in 2000-01, while the contribution by state governments was 11%.

Tables 25.4 and 25.5 show the data for 2000-01 and 1990-91 respectively.

25.4 EXPENDITURE ON R&D, Source of funds - 2000-01

Commonwealth Government
State
government
Businesses
Other Australian(a)
Overseas





Total
Sector
$m
% of
total
$m
% of
total
$m
% of
total
$m
% of total
$m
% of
total
$m

Business
168.5
3.4
8.4
0.2
4,504.5
91.6
28.3
0.6
207.6
4.2
4,917.4
Government
Commonwealth
1,213.2
85.1
27.5
1.9
76.9
5.4
73.0
5.1
34.2
2.4
1,424.8
State/territory
71.4
7.6
650.1
68.9
54.5
5.8
159.9
16.9
7.7
0.8
943.6
Total
1,284.6
54.2
677.6
28.6
131.4
5.5
232.9
9.8
41.9
1.8
2,368.4
Higher education(b)
(c)2,395.6
86.3
87.9
3.2
136.2
4.9
94.2
3.4
60.7
2.2
2,774.6
Private non-profit
72.5
25.6
29.8
10.5
18.4
6.5
136.2
48.1
26.3
9.3
283.2
Total
3,921.2
37.9
803.7
7.8
4,790.5
46.3
491.6
4.8
336.5
3.3
10,343.5

(a) Includes funds provided via government levies.
(b) Data for calendar year 2000.
(c) Includes $1,746m of General University funds, the majority of which is funding from the Commonwealth Government.
Source: Research and Experimental Development, All Sector Summary, Australia, 2000-01 (8112.0); Research and Experimental Development, Businesses, Australia, 2000-01 (8104.0).

25.5 EXPENDITURE ON R&D, Source of funds - 1990-91

Commonwealth Government
State
government
Businesses
Other Australian(a)
Overseas





Total
Sector
$m
% of
total
$m
% of
total
$m
% of
total
$m
% of
total
$m
% of
total
$m

Business
54.2
2.6
8.8
0.4
1,991.4
94.8
6.0
0.3
39.3
1.9
2,099.8
Government
Commonwealth
939.5
90.9
8.5
0.8
74.6
7.2
2.5
0.2
9.1
0.9
1,034.0
State/territory
73.9
11.0
526.9
78.6
44.6
6.7
21.1
3.1
3.4
0.5
670.0
Total
1,013.3
59.5
535.4
31.4
119.2
7.0
23.6
1.4
12.5
0.7
1,704.0
Higher education(b)
1,190.6
89.3
29.6
2.2
29.9
2.2
73.4
5.5
9.3
0.7
1,332.8
Private non-profit
24.3
28.5
12.0
14.1
7.7
9.0
38.3
44.9
3.0
3.5
85.5
Total
2,282.4
43.7
585.8
11.2
2,148.2
41.1
141.4
2.7
64.2
1.2
5,222.0

(a) Includes funds provided via government levies.
(b) Data for calendar year 1990.
Source: Research and Experimental Development, All Sector Summary, Australia, 1990-91 (8112.0).


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