April 15, 2025
Professor Peter Shergold AC, Chair, Australian Research Council Board
Group of Eight Response to the Policy Review of the National Competitive Grants Program (NCGP) Discussion Paper: A new plan for ARC-funded research
Introduction
The Group of Eight (Go8) consents to the publication of this submission and has no wish for any of it to be treated as confidential. Please note that this submission represents the views of the Go8, and our member universities may make their own, more detailed submissions.
The Go8 represents Australia’s leading research-intensive universities conducting 70 per cent of the research in the university sector. The Go8 invests $8.5 billion in R&D annually, which is more than 20 per cent of the national total. The Go8 universities are the largest recipients of Australian Research Council (ARC) funding, administering 69 per cent of NCGP funding for projects commencing in 2023.
As such, the Go8 strongly supports the renewal of the NCGP through the Policy Review to deliver a fit-for-purpose and sustainable NCGP for the next 20 years.
However, to do so the NCGP must be framed within both the national and international systems in which it is embedded. It must also prioritise the preservation of its role as the sole significant Government funding scheme for non-health and medical basic research[1] and its overarching mission to support excellent research.
In this context, it is important to note that Strategic Examination of Research and Development (SERD) is looking at the entire Australian R&D system and will be setting the parameters of the national system in which the NCGP operates. Consequently, it is essential that each of the NCGP Policy Review and the SERD directly inform the other.
At the very least, consideration of the external factors that will influence whether the proposed reform of the NCGP can and will be successful must be considered as part of the SERD. The most important of these is structural reform to address the distorted funding model for research undertaken through the NCGP (and other Government research grants) that does not sufficiently support the full economic cost of research.
To provide more detail on this broader context the Go8 submission to the SERD is provided as an attachment.
Internationally, we are seeing a shake-up of the global order which includes questions regarding collaborations with the US and a renewed emphasis on broader international research partnerships, in particular access to the world’s largest collaborative research fund Horizon Europe.
We are also entering into a time where there will likely be a high transnational mobility of elite research talent and the Australian research system – including the NCGP – must be prepared to take advantage of this.
The Go8 is concerned that the current schedule for the NCGP Policy Review report to be finalised in June 2025, with implementation from as early as 2026, means that long-term changes to the NCGP will be locked in without appropriate account taken of these considerations.
However, even as it stands and assuming a national research context that remains unchanged by the SERD or global events, the proposed NCGP model stretches funding extremely thinly, and the country’s future research and talent pipeline will be at risk as a result.
With this context, the Go8 makes two recommendations on and identifies five significant risks to the NCGP model proposed in the discussion paper.
Recommendations
Recommendation 1: that the ARC Board provide a submission to the SERD detailing the outcomes of the current NCGP consultation including advice on the national R&D system settings needed to support the NCGP. Additionally, the ARC Board recommend to the Minister for Education that the NCGP Policy Review should not be completed until after finalisation of the SERD.
Recommendation 2: that the proposed Realise Indigenous Capability scheme be renamed the Realise Indigenous Excellence scheme and that the ARC increase its support for Indigenous research through the appointment of an Executive Director for Indigenous Knowledge.
Identified areas of significant risk for the NCGP that must be considered in a whole of system context
Risk 1: The NCGP is only sustainable because of the significant financial co-contribution of universities and the proposed NCGP model stretches funding extremely thinly, with the country’s future research and talent pipeline at risk as a result.
Risk 2: The NCGP is the only significant Government funder of standalone basic non-health and medical research.
Risk 3: The NCGP must be supported by national infrastructure which is at risk because of the NCRIS funding cliff.
Risk 4: NCGP fellowships are currently a major pathway to recruit and retain high-level research talent in Australia and this is missing from the proposed new model for the NCGP.
Risk 5: The proposed NCGP model will struggle to facilitate genuine career paths for early-career researchers (ECRs) and mid-career researchers (MCRs) for Australia’s research workforce including in academia, industry, in government and moving between the sectors.
Discussion
Go8 Recommendations
Issue: the ARC and the NCGP must be supported as an integral part of the national R&D system
Go8 Recommendation: that the ARC Board provide a submission to the SERD detailing the outcomes of the current NCGP consultation including advice on the national R&D system settings needed to support the NCGP. Additionally, the ARC Board recommend to the Minister for Education that the NCGP Policy Review should not be completed until after the finalisation of the SERD.
Why the ARC NCGP reform should be considered as part of the SERD process
Through the NCGP the ARC is the major Government direct funder of non-health and medical research, distributing seven per cent of the Government’s total investment in R&D worth an estimated $1.037 billion in 2024-25.[2]
The NCGP is also the major Government stream for non-health and medical basic research.
As such, the work that the NCGP supports is integral to Australia’s R&D system in terms of the knowledge generation and the research workforce that is needed throughout the economy. Given this, the NCGP needs to be connected to the broader R&D system. The redesign of the NCGP model must inform and be informed by the SERD public consultation process to be successful.
Issue: building the excellent leadership, capacity and capability needed to strengthen the contribution of Indigenous knowledge to Australian research
Go8 Recommendation: that the proposed Realise Indigenous Capability scheme be renamed the Realise Indigenous Excellence scheme and that the ARC increase its support for Indigenous research through the appointment of an Executive Director for Indigenous Knowledge.
Fostering excellence in Indigenous research and Indigenous researchers
The Go8 believes that the role of both the Go8 members institutionally and the ARC is to support truly excellent research. Nowhere is this more important than in strengthening the contribution of Indigenous knowledge to Australian research and in supporting Indigenous researchers.
We should settle for nothing less than truly excellent Indigenous research capability participating in and informing our national research effort.
As such, the Go8 supports the creation of a standalone program to achieve this in a new NCGP but that it should be named the Realise Indigenous Excellence scheme.
While this scheme provides a development pathway for Indigenous researchers it is critical that the excellence that is fostered through the scheme is integrated into all of the schemes in the new NCGP and that the peer review process reflects the excellence of the research applications to underwrite success in the NCGP grant evaluation processes. To ensure this the Go8 recommend that the ARC appoints an Executive Director for Indigenous Knowledge.
Go8 identified areas of significant risk for the NCGP that must be considered in a whole of system context.
Issue: sustainable support for the NCGP
Go8 identified risk: The NCGP is only sustainable because of the significant financial co-contribution of universities and the proposed NCGP model stretches funding extremely thinly, with the country’s future research and talent pipeline at risk as a result.
The funding model of the NCGP
The NCGP discussion paper does little to engage with the reality of the sustainability of the funding model of the NCGP and yet nothing could be more important to the proposed 20-year vision with which the re-envisaging of the NCGP is framed.
The discussion paper simply notes (somewhat misleadingly) that “Much of the indirect funding for universities comes through the research block grants administered by the Department of Education.”[3]
It is important to note that “much” does not mean “most” with internal Go8 estimates conservatively suggesting that a dollar of external research grant income requires $1.19 of internal expenditure to support it.[4]
While historically, universities, and in particular Go8 members, have filled this funding shortfall in the full economic cost of research, over recent years this gap in support has been widening (Chart 1 below shows the dilution of research block grant support for Government grants such as provided through the NCGP).
As a result of the introduction of Job Ready Graduates (JRG), Go8 members are now also cross-subsidising domestic teaching. This cross-subsidy into both research and teaching is predominantly funded through the major external university revenue source, international student fees. International student fees accounted for 30 per cent of aggregate Go8 revenue in 2023 and this funding source has been under threat by proposals to cap numbers of international students. Additionally, current geopolitical instability may threaten the international student market. Any shock of this kind would very quickly undermine the current and proposed operation of the NCGP.
In this context, the NCGP model in the discussion paper raises concerns as it stretches ARC funding further and hence requires a greater level of support from universities. In particular, changing the NCGP to require fellowships to be supported by a substantive university position increases the effective co-contribution of universities.
While this may be seen as addressing the effective removal of research funding for academic positions through the Commonwealth Grant Scheme (finalised through the introduction of JRG), it is not a change that should be made without explicit consultation in the broader context of the entire university funding system and national R&D system.
To that end, the concerns raised here should not be interpreted as an ask for more funding but rather a request for a considered, system wide approach to structural reform that resolves the distorted funding model for university research.
Issue: support for non-health and medical basic research
Go8 identified risk: The NCGP is the only significant Government funder of standalone basic non-health and medical research.
Why the ARC NCGP reform should quarantine some funding for standalone basic research
As noted in the NCGP discussion paper, the ARC and NHMRC are the only Government funders of basic research (Technology Readiness Level 1).[5] Basic research is the bedrock of the entire Australian innovation system. The proposal in the discussion paper to assess research grants under one rubric – to acknowledge the often-non-linear path of research – makes it unclear whether the NCGP will be able to continue its responsibility in supporting basic research to the extent the nation requires. It is the role of the ARC to protect basic research as the only substantial government funder of non-health and medical research. While some projects (73% of current ARC projects according to the discussion paper) defy categorisation under pure basic, strategic, basic or applied research, there is research that is entirely basic and may not have immediate links to end users or outcomes.
The discussion paper speaks to “supporting bold thinking and the best early-stage research regardless of whether it is theoretical, methodological or aimed at addressing recognised problems” (Page 10). However, what is not clear is how a merit-based assessment can appropriately compare research that is pure basic with that is applied research or a combination of basic and applied research, in a way that does not disadvantage basic research.
This issue must be resolved in any redesign of the NCGP with the simplest solution to quarantine funding for basic research and in particular pure basic research.
Issue: The NCGP needs to be supported by national infrastructure
Go8 identified risk: The NCGP needs to be supported by national infrastructure and this support is at risk because of the NCRIS funding cliff.
National infrastructure to support the national research effort
While the NCGP currently provides research infrastructure funding through the Linkage Infrastructure, Equipment and Facilities (LIEF) grants – with universities required to make significant co-contributions – the NCGP cannot be successful moving forward without a continuation of the National Collaborative Research Infrastructure Strategy (NCRIS) beyond the current funding cliff of 2028-29. NCRIS facilities – many hosted by Go8 members – provide significant platforms for national research and engagement between universities and industry and other end users, also a priority of the proposed NCGP model. Infrastructure funding support is linked but separate to the issue of unfunded indirect costs supported by universities. With the Government commitment to NCRIS to end after the 2028-29 financial year it is unlikely that universities will be able to fund new national infrastructure nor maintain all existing facilities. The investments currently through LIEF and projected to continue through the new NCGP will not provide for investment of this scale.
Issue: attracting top level international research talent to Australia
Go8 identified risk: NCGP fellowships are currently a major pathway to recruit and retain high-level research talent in Australia and this is missing from the proposed new model for the NCGP.
The role of NCGP fellowships in Australia’s research system
We are currently seeing a shake-up of the global research system that will likely result in mobility of top-level researchers globally and particularly out of the US. This will occur as a flight to quality research systems and also place a premium on increased international research engagement.
In the current NCGP the Laureate Fellowships, Future Fellowships, Industry Fellowships and DECRA are open to international candidates providing a pathway both into and within the Australian research system.
In the proposed NCGP model these possibilities are largely removed with fellowships relying on a substantive university position. While Go8 members will certainly continue to recruit top level researchers into university positions it is imperative to signal to international researchers that Australia’s premier research funding agencies directly support topflight researchers coming into the country. In doing so, it will also be important ARC fellowship programs align with Government initiatives such as the National Innovation Visa that fast-tracks global innovation talent into Australia.
Issue: career paths for ECRs and MCRs
Go8 identified risk: The proposed NCGP model will struggle to facilitate genuine career paths for early-career researchers (ECRs) and mid-career researchers (MCRs) for Australia’s research workforce including in academia, industry, in government and moving between the sectors.
The role of NCGP in career paths for ECRs and MCRs
Ensuring sustainable career paths for ECRs and MCRs in a financially constrained system is an extremely challenging task. The Go8 believes there are issues with the proposed NCGP approach.
The focus on embedded fellowships – where the fellowship is reliant on a substantive university position – does not recognise the full diversity of pathways and the importance of mobility within the research system (including into the system from overseas).
Additionally, the limitation of embedded fellowships to two years is insufficient to enable researchers at all career stages, particularly ECRs, to develop and execute a robust research program. Finally, while the proposed Lead and Mentorscheme provides postdoctoral researchers and PhD students working under the senior lead researcher with fast-tracked development of research skills, this must be carefully balanced with the need for these researchers to establish independent track records that allow them to be competitive for research positions both in Australian and internationally.
[1] See Figure 1: Example of Australian Government Funding for R&D on Page 16 of the discussion paper
[2] 2024-25 Science, research and innovation (SRI) budget tables
[3] Page 14
[4] This is based on a 2019 analysis by the Go8 Chief Financial Officers.
[5] Page 16: Figure 1: Example of Australian Government Funding for R&D
