Transcript Key Findings from the Economic Impact Assessment of

Key Findings from the Economic Impact
Assessment of the CRC Programme
13 December 2005
First a thanks and an apology…
Thanks to everyone for providing so much input for the
study. Your efforts in the short time available were much
appreciated.
Apologies to those whose material didn’t make its way
into the case studies in the report - this was simply a
product of the need to keep the report length
manageable for the target audience.
2
Key findings from the study
This study is unique in that it measures only the quantified and verified
(by end users) delivered net benefits of a major Government R&D
funding program in Australia.
Even with the exclusion of a number of significant but unquantifiable
benefits generated by the CRC Programme, the study shows that the
CRC Programme has delivered a clear net economic benefit for
Australia.
There are significant lead times involved between the establishment of
a CRC and the delivery of measurable economic impacts.
Over time the CRC Programme’s performance, especially in relation
to industry engagement, has been improving and the pipeline of future
potential benefits from the CRC Programme looks strong.
3
Even with the strict inclusion criteria used in the
study, the CRC Programme is shown to have
delivered a clear net economic benefit to Australia
$1 allocated to general
Government expenditure
$X of GDP
$Y of Real consumption
$Z Real Investment
$1 instead allocated to
the CRC Programme
$X + 60c of GDP
$Y + 40c of Real consumption
$Z + 22c of Real Investment
Benefits have primarily been delivered through the application of
research by industry to reduce costs and increase productivity and
through the sale of new products (by existing or new companies) that
are based on CRC research.
4
The time lag between the commencement of a
CRC and the achievement of a quantifiable
economic impact is considerable
Lag between
commencement
and outcome
*
*
*
*
*
*
*
*
*
*
*
**
*
*
*
*
*
*
**
*
*
1992
1993
1994
CRC CRC
Round Round 3
1&2
1995
1996
1997
CRC
Round 4
Time from commencement to
quantifiable outcome in years for
each CRC
1998
CRC
Round 5
1999
2000
CRC
Round 6
2001
2002
CRC
Round 7
Quantifiable outcome
2003
2004
CRC
Round 8
*
*
2005
4 years
6 years
7 years
8 years
9 years
9 years
10 years
10 years
10 years
11 years
11 years
11 years
12 years
12 years
7 years
8 years
10 years
10 years
11 years
11 years
11 years
9 years
7 years
6 years
4 years
Avg. lag 9 years
CRC
Round 9
*
5
Over time the CRC Programme’s performance,
especially in relation to industry engagement, has
been improving
Industry contribution to R&D
expenditure in CRCs and
Universities: 1992 to 2005
Industry researchers participating
in CRCs: 1992 to 2005
%
400
20
*
300
15
200
10
CRCs
Universities
100
5
0
0
*
Source:
DEST Science and Innovation data and data collected through survey of past
present CRCs
Spike due to a high level of industry investment in the
Australia Photonics CRC relating to the establishment of
a number of spin-off companies.
and
6
Impact in the area of postgraduate student
training is also strong
The number of postgraduate students involved in CRCs
has risen steadily over the life of the Programme
There is evidence of positive outcomes associated with
the CRC training environment, including:
Higher student satisfaction with faculty quality
Higher student satisfaction with equipment quality
More positive views of career prospects
A stronger interest in pursuing a research career in industry
More investigation into student outcomes would help
build the case for the Programme even further.
7
The study has several implications for the
future of the CRC Programme
The Programme is meeting “third stream” objectives and
the prima facie case for its continuation is clear.
The Programme’s performance appears to be improving
over time with the majority of benefits from past
investment still to be delivered.
To improve Programme evaluation in the future, there
needs to be a stronger focus on tracking of final
outcomes achieved by CRCs. This is a particularly
difficult challenge for CRCs where the benefits are
widely diffused.
8
Implications for R&D impact assessment
more broadly
Given the long lead times to the generation of delivered benefits,
many R&D funding program reviews will continue to rely on making
forward estimates of likely benefits that are based on consideration
of early outcome indicators.
Issues that CRC applications should address in the forward looking
economic impact statements that accompany their applications
include:
The opportunity cost associated with investment into the project.
The extent to which a final economic benefit will be attributable to a project.
The costs incurred by end users in adopting or applying research.
The time lags involved between commencement of research and achievement of
a final economic benefit.
The plausible quantification of future benefits that may be delivered.
The risk that a project will not succeed in delivering some or all of its intended
outcomes.
The conversion of future economic impacts to net present value terms.
9