Defence science and innovation: an affordable strategic advantage
9 Jun 2015| and

In a Special Report launched today, we show how Australia’s defence science policy is at a critical juncture. Years of budget salami slicing and organisational change to refocus on short-term services has left the Defence Science and Technology Organisation (DSTO) ill-equipped to maintain the ADF’s technological edge into the future. It was unsurprising that the First Principles Review couldn’t clearly articulate the value of DSTO’s contribution to Defence outcomes.

Rapid economic growth in the Asia–Pacific is transforming economies, adding new levels of uncertainty to the geopolitical landscape and modernising many of the region’s armed forces. Much of this growth has been enabled by placing new technology in the hands of billions of people.

Since the turn of the century, global research and development (R&D) expenditure has doubled; it’s grown most quickly in Asia. South Korea dedicates more than 4% of its GDP to R&D, while China’s on track to exceed total US R&D expenditure by about 2020. By contrast, Australia’s investment as a proportion of GDP is 2% and falling. Current expenditure on defence science is about half, in real terms, of what we spent per Australian in the mid-1970s.

The forthcoming Defence White Paper must account for R&D trends because the dissemination of the fruits of research across the world will have a greater impact on Australia’s defence this century than it did last century.

Innovation developments that will have a bearing on our defence are global in nature and thus broadly accessible to individuals, organisations and nation states. While technological development is a global phenomenon, our defence needs are unique, bound as they are by geography, competing interests and existing strengths.

That presents unique and evolving demands for a domestic defence research capacity. Not least of which is the role of innovation in maintaining our alliances. That was noted last Saturday by US Secretary of Defense Ash Carter in his address to the IISS Shangri-La Dialogue, where he noted the US was exploring defense technology cooperation with both Australia and Japan.

The practice of R&D is changing, with collaboration between organisations (public and private) across industries and nations becoming the norm rather than the exception. This trend is driven by efficiency— technology is advanced most productively by sharing long-term goals, ideas, talent, capital and risk.  That’s relevant to defence science because, unlike much of the 20th Century, the vast majority of R&D today is led by the private sector in response to consumer demands.

We argue that adaptating Australia’s defence R&D engine is essential because our defence science footprint is diminishing at a time when Australia’s strategic outlook is becoming much more complex, and global technology and defence science trends evolve rapidly

Australia’s assets don’t include cheap labor, a huge population or vast capital. They do, however, include a feature common to very few nations, a built Australian advantage: deep technological problem-solving expertise, born from decades of public investment.

The infrastructure that is Australia’s universities, research institutions and industry provides opportunities to collaborate with Defence on basic and applied research challenges. Refocusing DSTO to undertake both basic and applied research, and rebalancing defence science resources to enable effective collaboration and networking (to a level which more closely mirrors that adopted overseas) is one approach.

That would entail the establishment of a new capability to mobilise the 95% of Australia’s research community and resources that reside outside Defence. Such an initiative, separate to DSTO, would build on the success of the Defence Material Technology Centre (DMTC) and adapt practices of the US Defense Advanced Research Projects Agency (DARPA). Such an approach would build the requisite critical mass across academia, industry and the government research community for a competitive defence innovation network in Australia.

The changing nature of technological progress, especially globalisation and commercialisation, suggests that a defence science function focused on advisory services is unlikely to meet Australia’s future defence technology needs. It certainly won’t make the most of Australia’s broader research investment, or that of our ally and partners.

The scaling back of Australia’s defence research and development efforts over the past decade is not in Australia’s strategic interest. That it seems to have been unintentional or a by-product of other defence policies suggests that it was a mistake by omission.

Our report suggests options to ensure Australia’s defence, from our future submarine force to our preparedness for asymmetrical threats, is fit for purpose in the technologically-driven decades to come. Overall, we suggest that the full spectrum of Australia’s R&D capacity be appropriately leveraged, from basic and applied research to industries of all shapes and sizes. Ultimately, Australia’s future defence preparedness and our ability to prevail on the battlefield will increasingly rely on how smart we are in harnessing and exploiting Australia’s intellectual talent base.