Getting down to business: industry action needed for security innovation
by Dr Chris Flaherty
Dr Chris Flaherty catches up with Senator the Hon. Kim Carr, Minister for Innovation, Industry, Science and Research to talk about R&D, Innovation and the Australian security industry.
ASM: What do you see as the major R&D opportunities for the Australian security industry?
Carr: Increasing security requirements and changing community attitudes will drive the development and adoption of technologies such as biometrics and radio frequency identification (RFID) – particularly outside government, which has been an early adopter.
The rising demand for seamless, easy-to-use systems will encourage the emergence of integrated technologies.
I would also expect opportunities to come from our strength in ICT, our capacity to adapt existing knowledge to create new solutions (e.g. logistics), and our experience in securing a large, water-bound country.
Innovation is not just about technology.
It is also about improving processes and organisational arrangements – both critically important in an industry as labour-intensive as security.
The work of groups such as the Research Network for a Secure Australia (RNSA) could also act as a catalyst for innovation and R&D.
The RNSA facilitates a knowledge-sharing network involving Australian and international research organisations, government and the private sector, with a focus on mitigating safety and security threats to critical infrastructure.
The RNSA is managed by representatives of the University of Melbourne, Queensland University of Technology and ADFA, with advice from an advisory board chaired by the Attorney-General’s department.
The security issues facing Australia differ from those facing nations with less land area and more concentrated populations.
This is a good thing. It forces us to be self-reliant and find our solutions.
It gives us an opportunity to become a world leader in securing sparsely populated areas.
ASM: In your view, compared to overseas (such as the UK, US and EU) how advanced is innovation and R&D in the Australian security industry?
Carr: It isn’t easy to compare Australia’s innovation performance in the security industry with that in other countries.
According to the CIVITAS Group, Australia represents only 2 per cent of the global homeland security market.
Europe and the UK together represent 24 per cent and the US represents 54 per cent.
This disparity in size makes meaningful comparisons difficult.
Looking at Australia’s innovation performance more broadly, I am concerned that Australia is falling behind its competitors in what has been described by the UK Government as the “race to the top”.
The World Economic Forum’s latest Global Competitiveness Index ranks Australia twenty-second for innovation performance – well behind our major competitors, including Japan, Korea, Taiwan, Singapore and Malaysia.
The innovation gap has widened over the last decade.
Two things holding our innovation performance back are low expenditure on business R&D and weak links between public researchers and industry.
According to the ABS, in 2004 and 2005, two-thirds of Australian firms spent nothing on innovation.
The review of the national innovation system currently underway is considering how we can change that.
ASM: Have you identified the main impediments to innovation and R&D in the Australian security industry? And what are these?
Carr: There are several impediments to innovation in industry.
In one ABS survey, 22 per cent of firms said lack of skilled staff was an impediment, 19 per cent blamed government regulations and standards, and 16 per cent believed their potential market was already dominated by established businesses.
These concerns are no doubt shared by the security industry as well.
These issues have been raised in consultations conducted by the innovation system review panel, and I expect the panel to make recommendations on how we can overcome them.
I should stress, however, that it is the government’s job to lay the foundations; it is business’s job to build on them.
Australian businesses cannot afford to wait for opportunities to come knocking at the door.
They must make their own opportunities.
That may require a bit of lateral thinking.
Instead of seeing regulations and standards as a problem, for example, why not think about the opportunities they create?
For one thing, they ensure consistency and interoperability in equipment, procedures, training and capabilities across borders.
The advantages of this to national organisations like Emergency Management Australia are obvious, but the same principle applies internationally as well.
For another thing, government requirements can actually increase demand for security services – just as international money laundering legislation is driving the push for innovative solutions, such as biometric technologies, in the finance industry.
ASM: Philosophically, how would you characterise the difference between the new Government’s approach to innovation and R&D in the Australian security industry; and that of the Howard Government?
Carr: The Rudd government’s approach to innovation marks a complete departure from what we have seen over the last eleven years. Our predecessors did not consider innovation central to economic competitiveness.
There was some support for innovation programs, but it was uncoordinated and 'ad hoc'.
The reduction of the R&D tax concession in 1996 was a body-blow to business R&D – and it came at a time when most other OECD countries were maintaining or increasing their support for private sector R&D investment.
The 'Backing Australia’s Ability' initiative was poor compensation.
It focused exclusively on input measures, so it is difficult to say what positive outcomes it had.
This government is serious about building a strong national innovation system which is tightly integrated into the global system.
The prime minister recently indicated that infrastructure, education and innovation were the key to reviving productivity growth in Australia.
The government will be setting concrete benchmarks to measure our performance in these three areas.
We have already crystallised the issues and established a framework for leadership by bringing innovation, industry, science and research into one portfolio.
The review of the national innovation system will inaugurate a new era for innovation in Australia.
We expect it to shape innovation policy for a decade or more.
Among other things, it will propose ways to rationalise and coordinate the 169 innovation programs offered by various governments across the country – another legacy of the 'ad hoc' mentality that has prevailed in recent years.
ASM: Are you planning a review of policy initiatives to better encourage innovation and R&D in the Australian security industry? If not, why are you happy with the current approach?
Carr: The innovation system review chaired by Dr Terry Culture is looking at Australia as a whole; it is not focusing on particular sectors.
It will identify gaps and weaknesses across the innovation system and suggest ways to address them.
Areas of concern identified in consultations to date include the supply of human capital, connections with international markets, and collaboration.
These are issues that affect everyone, including the security industry.
Dr Cutler and his colleagues may well recommend that further work be done on specific sectors, but I cannot pre-empt their findings.
The critical point is that I intend to build a broad and pervasive culture of innovation – a culture that takes in all areas of the Australian economy, and all areas of Australian life. I expect the security industry to be part of that culture.
Senator The Hon. Kim Carr was appointed Minister for Innovation, Industry, Science and Research in December 2007. He held a range of shadow portfolios during the previous Parliament, including acting as the Shadow Minister for Industry, Innovation, Science and Research in 2003-04 and from December 2006 until the 2007 Federal Election. He is a graduate of the University of Melbourne, with a Bachelor of Arts (Honours), a Diploma of Education and a Master of Arts degree.
About the author: Christopher Flaherty is currently an independent critical infrastructure protection advisor; living in London He is currently, a Visiting Fellow in Safety and Risk at the University of New South Wales. He earned his PhD in Philosophy in 2002. Following 2005, he was the network administrator for the Research Network for a Secure Australia and research leader for counter-terrorism. From 2006, he was the security and counter-terrorism R&D manager at Sinclair Knight Merz, and was their research leader for the Building Vulnerability Analysis Project, and then a Principal Consultant with Critical Infrastructure Protection Pty Ltd.