Australian H&MR Facts

Funding health & medical research in Australia

Summary

    • $10 billion is spent on health and medical research (HMR) in Australia each year
    • More than a quarter (26%) of all Australian Research and Development (R&D) is spent on HMR (Total R&D is around $40.6 billion in 2022/23)
    • 4% of all spending on health is spent on HMR (total health expenditure in 2021-22 was $241 billion)
    • 0.4% of GDP was spent on HMR (Australian GDP in 2022-23 was $2,564 billion)
    • Nearly half of all Australian HMR is undertaken in the higher education sector
    • HMR accounts for more than one third (35%) of all R&D expenditure in higher education institutions
    • 31% of all HMR expenditure is in the private sector

Expenditure by sector

The following table is an estimate of where HMR expenditure occurs in Australia

Location of expenditure $million      
Aust. Govt. (including agencies) States & Territories Higher Education Not For Profit Business Total
134 672 4,947 1,387 3,200 10,340
1% 7% 48% 13% 31% 100%

The estimates are complicated because they are:

  • based on Australian Bureau of Statistics (ABS) data and the ABS surveys the different sectors for different periods. Government and NFP data is for 2022/23; Higher Education is for the calendar year 2022 and Business is for 2021/22
  • the ABS categorises data by Socioeconomic Objective (SEO) and by Field of Research (FoR). The SEO of Health generally provides the most accurate estimate but the combined FoRs of Biomedical and Clinical Sciences; and Health Sciences (ANZSCR 2020); is used for Business because most HMR in industry is classified not under the SEO of health but under the SEO of manufacturing. The ABS data is not provided at sufficient detail to enable health R&D to be extracted from the SEO of manufacturing.[1]

[1] Prior to 2020 the FoR of medical and health sciences (ANZSCR 2008) was used. From 2020, the New ANZSCR 2020 is applicable.

Australian Government 

While only a relatively small proportion of HMR is undertaken directly by the Australian Government it is responsible for providing the funding for a much larger proportion, particularly in higher education and Medical Research Institutes (MRIs). This includes funding provided through the National Health and Medical Research Council (NHMRC) and Australian Research Council (ARC). It also includes funding provided to universities through the block grants system, which is tied to the volume of each university’s research and the number of research students.

Australian Government funding of HMR through universities and MRIs

Australian Government funding of HMR through universities and MRIs

NHMRC Funding $946 million
ARC Funding contribution to HMR (10%) $81 million
Research Block Grants contribution to HMR (35%) $700 million
MRFF $650 million
Total $2,377 million

Source: Australian Government Science Research and Innovation Budget Tables 2023-24 estimated expenditure for 2023-24

 

This estimate assumes all MRFF funding in 2023-24 went to universities and MRIs as it is not possible to break this figure down. This estimate does not take into account taxation measures such as the R&D Tax Incentive and programs like the Department of Industry Innovation and Science Entrepreneurs Program, which support the development and commercialisation of research generally, including new medicines, medical devices and therapies. It also doesn’t reflect other Commonwealth Government support provided to universities and MRIs which are used for new buildings and facilities that support HMR.

 

State and Territory Governments

State and territory governments are responsible for funding research undertaken within the State and territory hospital systems; the provision of support to MRIs for the indirect costs of research; and other programs to support R&D, a portion of which funds HMR. State and territory governments also provide capital funding for stand-alone research institutions (e.g. the South Australian Health and Medical Research Institute) and for organisations that combine research with health care delivery (e.g. the Victorian Comprehensive Cancer Centre).

It is likely that the total support provided to HMR significantly exceeds the $672 million per annum captured in the table above.

Higher Education

The bulk of Australian HMR is conducted in the Australian higher education sector, and is funded by the Australian Government, philanthropy and universities own funds from other sources, including teaching revenue for the Australian Government and students. Approximately one third (35%) of all research expenditure by the higher education sector is on health and medical research.

Source: ABS 8111.0, Research and Experimental Development, Higher Education Organisations, Australia 2022, SEO Health ($4,947 million) divided by total expenditure ($13,990 million).

Not for Profit sector

The Not for Profit sector spent approximately $1.4 billion on R&D in 2022/23, of which $1.64 billion (87%) was spent on the SEO of Health. The concentration of research in the non profit sector on HMR reflects the dominance of this sector by Medical Research Institutes (MRIs). The next highest categories were Education and Training with $58 million, Plant Production and Plant Primary Products ($18 million) and ICT ($15 million).

Source: Research and Experimental Development, Government and Private Non Profit Organisations, 2022-23 PNP expenditure by SEO, 2022-23

Business

Expenditure on HMR represents approximately 15.5% of total R&D spending by business. Much of the R&D expenditure by businesses has an emphasis on the ‘D’ (Development) in R&D rather than research. For this reason it is captured in the broad SEO of Manufacturing rather than Health; the combined FoRs of Biomedical and Clinical Sciences; and Health Sciences are used in the above table to estimate business expenditure on H&MR.

Source: Research and Experimental Development, Businesses, Australia, 2021-22 FoR for  the combined FoRs of Biomedical and Clinical Sciences; and Health Sciences ($3,200,000,000) divided by total expenditure ($20,642,000,000).

For more information contact Greg Mullins, Head of Policy, greg.mullins@researchaustralia.org

Image credit: Professor Len Harrison, Walter and Eliza Hall Institute

Research is central to the Universities Accord

Research Australia’s submission to the Universities Accord Discussion paper responds to two key issues. The first relates to the career prospects and professional development of early and mid-career researchers. Research Australia proposes that this be a shared responsibility of research funders, universities, researcher managers and researchers. We also welcome further consideration of programs to support exposure to roles in industry and government during the completion of a higher degree by research.

The second relates to the funding for indirect research costs. We propose a new structure for the future funding of direct and indirect research costs and two distinct principles to guide the structure. We also propose that funding for national research infrastructure be included in these deliberations.

In each proposal we outline the case for how and why these issues should be addressed by an Accord between universities and the Commonwealth Government.

Research Australia’s submission is available here.

2021 Pre Budget submission calls for renewed investment in R&D

Research Australia’s Pre Budget submission to the Treasurer ahead of the 2021 Budget  focuses on the vital role of health and medical research and innovation in Australia’s  response to the COVID-19 pandemic, and the manufacturing and innovation opportunities that health and medical research presents for Australia’s economic recovery.

It calls for renewed investment in R&D by the Australian Government, continued support for universities and medical research institutes with meeting indirect research costs, and measures to support medical products R&D and manufacture. The case for increasing NHMRC and ARC funding is also made. Funding for Government initiatives in data sharing and preventive health are among other measures sought.

Research Australia’s submission is available here.

Australian Honours to our Members

One of our key roles as the peak body for health and medical research (HMR) is to bring to light the importance of HMR in our society and to honour and recognise the work being done in the sector.  Just as our annual awards give members the opportunity to recognise outstanding contributions, so do the esteemed Australia Day Honours and we’re delighted that so many of our member organisations have recipients in the list of those receiving such honours.

You might be interested to know that The Australia Day 2019 Honours list is the largest in the history of the Order of Australia – recognising 1127 outstanding and inspirational Australians. Women received 422 – or 37.4 per cent – of awards – the highest number and percentage ever. The number of nominations and awards for women are trending up.

We’d like to acknowledge the wonderful group who have received honours, and recognise that many recipients have worked collaboratively with a number of our members, so we spread our congratulations widely across our alliance.

To view the official Australia Day 2019 Honours List – please click the below link.

https://www.gg.gov.au/australia-day-2019-honours-list

 

Australians embrace health and medical research in a changing landscape of healthcare

Media Release
September 12, 2018

Australians continue to place improving hospitals and healthcare as the number one spending priority for the Australian Government ahead of infrastructure, education standards and employment opportunities.

We are pleased to see that more funding for health and medical research is the 6th most important of the 27 priorities presented in the poll. (It has been consistently in top 10 ever since we started polling in 2003.)

Interest among Australians in health and medical research is high with 89% saying they are interested in health and medical research.  However, while confident in their ability to contribute to decision making about the future direction of HMR most Australians don’t know how, and many don’t believe they’d be heard.  Our governments and research organisations clearly have more work to do to meaningfully engage with the broader community.
Continue reading “Australians embrace health and medical research in a changing landscape of healthcare”

Research Australia Welcomes My Health Record Reforms


 

 

 

MEDIA RELEASE
1 August 2018

My Health Record: Health and medical researchers welcome strengthened privacy

Australia’s health and medical research sector has welcomed Government moves to strengthen privacy protections of the My Health Record.

“Australians must be able to confidently participate in this scheme. Strengthening the My Health Record Act is an important first step in ensuring public trust in the system.

“People have real concerns over privacy and access of their My Health Record and those concerns must be heard and addressed through additional communications to the public about the benefits and purpose of the My Health Record. This is too important an opportunity to forego because of a lack of information,” said Research Australia’s CEO, Ms Levin.

An overnight poll of Research Australia members shows continued support from the health and medical research community for the My Health Record, with a majority of respondents in favour of the scheme.

Research Australia has written to Federal Health Minister, Greg Hunt, offering the assistance of health and medical researchers in explaining how My Health Record data could be used to further vital health and medical research and improve our health system.

Research Australia is the national peak body representing the whole of the health and medical research pipeline: www.researchaustralia.org

Media contact: Lucy Clynes 0404 068 912

Budget 2018-19 | Budget Analysis

Summary

The 2018 Federal Budget provides an optimistic forecast for Australia’s economic future, with increased revenue and several new funding announcements, as might be expected of an election year Budget. The health and medical research and innovation sectors have not missed out, with confirmation the Medical Research Future Fund remains on track to reach its capital target of $20 billion by 2020-21 and the announcement of a long list of MRFF funded projects stretching over the next decade (well in advance of the current two year funding priorities).

Consistent with Research Austrlalia’s earlier calls, including in its Pre-Budget Submission, the Government will direct $240 million of MRFF funding to a Frontier Medical Research program to develop innovative medical ideas, research devices and treatments.

A $500m Australian Genomics Health Futures Mission will help more than 20,000 Australians live longer and receive better treatment tailored to their needs.

The Government has announced plans to cap the funding available under the refundable R&D Tax Incentive at $4 million per year. While the caps will probably be more than enough for most small companies developing a new product, such a cap could have had a significant impact on small companies developing new medicines and therapies. However, the Government has heard our arguments and in a really positive development it has announced that clinical trials will be excluded from the cap.  This is a great outcome for the health and medical research and innovation sector.

While there is some good news for tertiary students in rural areas with increased funding for sub-bachelor and bachelor programs and new rural medical programs in Victoria and NSW, the cuts announced last year remain.

In other news we have funding committed to research infrastructure.

Read on for more detail.

Medical Research Future Fund

$20 billion in capital by 2020-21

As at 31 March 2018 the MRFF had $6.7 billion in capital. Tonight’s budget confirms that the MRFF remains on track to reach the target of $20 billion in capital by 2020-21, with a forecast balance of $20.2 billion at 30 June 2021. $2.3 billion is scheduled to be added to the capital in the next financial year. The heavy lifting comes in financial year 2019-20, when $7.8 billion is forecast to be added to the MRFF capital balance. This is likely to be after the next Federal election.

MRFF Capital

$m.
17-18 18-19 19-20 20-21 21-22
Capital to MRFF 2,242.199 2,288.550 7,830.490 2,409.476 Nil

Funding from the MRFF

Forecast spending from the MRFF also remains as expected, with more than $222 million available to fund medical research and innovation in 2018-19, rising to $646 million by 2021/22, the first year after the MRFF reaches full capitalisation of $20 billion. Total funding provided by the MRFF up to and including 2021-22 is forecast to be just shy of $2 billion.

MRFF expenditure

$m.
17-18 18-19 19-20 20-21 21-22
Funding (2018 Budget) 143.315 222.383 392.703 650.236 645.951

Funding Announcements

The Budget included numerous announcements of further funding to be made in the next financial year and further years, including:

  • $125 million over 10 years from 2017-18 for a Million Minds Mental Health Research Mission to support priorities under the Fifth Mental Health and Suicide Prevention Plan;
  • $75 million over four years from 2017-18 to extend the Rapid Applied Research Translation program that supports Advanced Health Research Translation Centres and Centres for Innovation in Regional Health;
  • $18.1 million over four years from 2017-18 for a Keeping Australians Out of Hospital program to support preventive health, behavioural economics and reduce avoidable presentations to hospital;
  • $39.8 million over four years from 2017-18 for a Targeted Health System and Community Organisation Research program with a focus on comparative effectiveness studies and consumer-driven research; and
  • $17.5 million over four years from 2017-18 for research into Women’s Health and research into Maternal Health and First 2,000 Days to address the underlying social determinants of health that impact on a child’s early days of life.

The Government also announced that it will provide $1.3 billion from the MRFF over 10 years from 2017/18 for a National Health and Medical Industry Growth Plan to improve health outcomes and develop Australia as a global destination for medical sector jobs, research and clinical trials. The announcements include:

  • $500 million over 10 years from 2017-18 committed to the Genomics Health Futures Mission, including $10.7 million in 2017-18 for genomics research;
  • $240 million committed to the Frontier Health and Medical Research program;
  • $248 million for expanded clinical trial programs;
  • $125 million over nine years from 2019-20 to contribute to the Targeted Translation Research Accelerator for chronic conditions focussed on diabetes and heart disease; and
  • $94.3 million for biomedtech programs and industry research collaborations.

Research Australia is particularly pleased to see the announcement of the Frontier Health and Medical Research Program, which we have been calling for.

NHMRC and ARC Funding

In its Pre-Budget submission, Research Australia called for increases in funding for the NHMRC and ARC’s research programs.

NHMRC Programs

The 2018-19 Budget reveals that funding for the NHMRC’s programs is falling in real terms. Funding to the Medical Research Endowment Account (MREA) for the NHMRC’s research programs is $829 million for 2018-19. Estimates for the following three years have the funding remaining virtually stable with increases of roughly 1.5% each year. The CPI was 1.9% for the year to 31 March 2018, so in real terms NHMRC funding continues to decline over the forward estimates, as it has for several years now.

NHMRC MREA Funding

$m.
17-18 18-19 19-20 20-21 21-22
Funding to the MREA 2018 Budget
817.990 829.324 842.766 855.407 868.238

ARC Programs

The Australian Research Council’s Funding Programs are critical to Australian publicly funded research including to the life sciences and medical technologies.

Over the forward estimates, the funding to the ARC for the Discovery Program declines slightly in later years compared to the estimates in last year’s budget. The increases year on year are a little greater than the current inflation rate of 1.9%.

 

$m.
17-18 18-19 19-20 20-21 21-22
Discovery (2018 Budget)
493.858 495.099 508.965 516.506 528.572
Discovery (2017 Budget)
492.736 493.708 511.540 522.537

The Linkage Program was singled out in the Government’s National Innovation and Science Agenda (NISA) as an important component of Australia’s innovation system, and it was announced that from 1 July 2016 the Program would be open to continuous applications and decision making would be fast tracked. Funding over the forward estimates is slightly higher than forecast in last year’s budget, and shows increases of around 3% each year, around 1% higher than the current rate of inflation.

$m.
17-18 18-19 19-20 20-21 21-22
Linkage (2018 Budget)
266.678 273.990 285.432 293.492 297.862
Linkage (2017 Budget) 265.319 265.843 275.444 281.366 N/A

While not funding ‘medical and dental research’, the ARC Linkage program remains important to the health and medical research and innovation sectors. For example, the latest round of ARC Linkage Program grants included funding to develop bio inks for 3D printing, a better inhaler for medicines, better understanding antibiotic use, and improved brain imaging.

Research Support

In addition to providing funding for the ARC Program, the Department of Education and Training also provides funding to universities to help cover the indirect costs of research. The forecasts for the next financial year and the following two years reflect increases of around 6% per annum, flattening out to a little more than 2% between 2020/21 and 2021/22.

Research Support Program

$m.
17-18 18-19 19-20 20-21 21-22
2018 Budget
923.709 903.425 959.816 1,018.879 1,042.302

The question of funding for the indirect costs of research funded by the MRFF continues to remain unclear. Research Australia will be investigating further whether the increase in the Research Support Program is a decision to increase the ratio at which funding is awarded, or simply accounting for an expected increase in direct research revenues, such as MRFF funding to universities.

The whole issue of indirect research costs remains an important unresolved issue for the whole health and medical research sector. Research Australia continues to call for a whole of government approach to the issue of funding indirect research costs. Research Australia proposes that the Chief Scientist lead a review of the funding of indirect research costs to establish a sustainable and equitable funding program. In the short term, MRFF funding to universities needs to be treated the same as NHMRC and ARC competitive grant funding, and the pool of funding for the Research Support Program should be increased proportionately.

Research Infrastructure

The key response to the Research Infrastructure Roadmap was a commitment by the Government to develop a Research Infrastructure Investment Plan to guide future funding. This Investment Plan has now been released as part of the Budget. A 12-year National Research Infrastructure Investment Plan will commit $1.9 billion to critical national research infrastructure, including $140 million for upgrades to the two most powerful computing facilities in the Southern Hemisphere.

R&D Tax Incentive

The Research and Development Tax Incentive is available to all companies that incur expenditure that meets the definition of eligible research and development. For larger companies that are making a profit, it provides a non-refundable tax incentive, at a rate of 38.5% of the eligible R&D expenditure (otherwise claimable as a business expense at the corporate tax rate of 30%). This reduces their tax bill.

Smaller companies, with revenue of less than $20 million are eligible for a refundable tax incentive. This tax incentive applies at the rate of 43.5% of the eligible expenditure, and is payable even if the company has not made a taxable profit. It is a direct (‘refundable’) payment to the company from the ATO.

Introduced in 2012, the R&D Tax Incentive has been a victim of its own success, with expenditure on the measure consistently exceeding Government forecasts. Relatively minor changes have been made to the R&D Tax Incentive in recent years, including introducing caps and reducing the rate by 1.5% to the current 38.5% and 43.5% but other measures were blocked by the Senate.  In 2015 the Government initiated a review of the R&D Tax Incentive. Proposals by the review to better target the R&D Tax Incentive have been strongly opposed by industry.  More recently the ISA’s report Australia 2030: Prosperity through Innovation (the 2030 Plan) has proposed a couple of further amendments to the Review’s recommended measures, including doubling the cap on the refundable R&D tax Incentive to $4million, and modifying the proposed intensity threshold to be applied to the non- refundable tax incentive.

In tonight’s Budget, the Treasurer has confirmed a range of measures to improve the integrity of the R&D Tax Incentive Program, including introducing a $4 million annual cap on the refundable component of the R&D Tax Incentive. Crucially, for the health and medical research and innovation sector, clinical trials will be exempted from this cap. This is a great outcome for the sector, which has argued that the high costs of taking a new therapeutic to market mean that small companies in this field would be unfairly disadvantaged by the cap.

CRC Program

Funding forecasts for the CRC Program are largely in line with last year’s budget. The program is forecast to receive $892 million over the period from 2017/18 to 2021/22.

$m. 17-18 18-19 19-20 20-21 21-22
2018 Budget 160.868 167.341 184.331 187.540 192.240

The CRC Program is important to health and medical research and innovation with about one third of the CRCs funded over the life of the program being health-related. The most recent round of CRC funding included $55 million over 7 years for the Digital Health CRC.

 

 

2017 Leadership in Corporate Giving Award Winner: The QBE Foundation

The Leadership in Corporate Giving Award recognises outstanding leadership by a corporation or business in giving to and supporting health and medical research. The award acknowledges the partnership and commitment of a corporation over time, an important dimension of effective corporate giving.

Congratulations to Award Winner: The QBE Foundation

The QBE Foundation is a global initiative to help QBE Insurance give back to the communities in which it operates through charity partnerships, donations and volunteering. Launched in 2011 to mark QBE’s 125th anniversary year, the Foundation formalises QBE’s long history of community involvement and corporate giving into a structured, global approach. Continue reading “2017 Leadership in Corporate Giving Award Winner: The QBE Foundation”

2017 Great Australian Philanthropy Award Winner: Andrew Forrest AO and Nicola Forrest

The Great Australian Philanthropy Award recognises recognises personal philanthropy that is outstanding in its generosity, effectiveness, vision, high impact and transformative quality. The award encourages personal philanthropic donations over a period of time by an individual or family to Australian health and medical research.

Congratulations to Award Winner: Andrew Forrest AO and Nicola Forrest of Minderoo Foundation

Continue reading “2017 Great Australian Philanthropy Award Winner: Andrew Forrest AO and Nicola Forrest”

2017 Health Services Research Award Winner: Australian & New Zealand Hip Fracture Registry

This Award is for an individual who has provided leadership and made an outstanding contribution to health services research; driven research that has led to a significant improvement in healthcare; and/or has championed the development of the health services research field.                                                                                 

Congratulations to Award Winner:
Australian & New Zealand Hip Fracture Registry

Continue reading “2017 Health Services Research Award Winner: Australian & New Zealand Hip Fracture Registry”