Underfunding basic research is a recipe for disaster

Entrepreneurs are the new kings, but academics doing basic research are key to our future – and they need proper funding, says Brian Schmidt

October 4, 2022
Tanks of water with various corals
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Founded in the aftermath of the Second World War, the Australian National University (ANU) was created as Australia’s first research university to help the nation “align itself to the enlightened nations of the world”. Research and the advances based around it were deciding factors in the war; it is not surprising that the Australian government included in the founding of the university the likes of Howard Florey, whose work on penicillin saved millions of lives; Mark Oliphant, who helped develop radar and was a key part of the Manhattan project; and Kenneth Le Couteur, who worked alongside Alan Turing to help crack the Enigma code. In 1946, when ANU was created, university professors were national heroes and research was king.

Seventy-five years later, we see a world transformed by university research, where average life expectancy has risen from 45 to 73 years, and where extreme poverty has dropped from 55 per cent of the global population to less than 10 per cent. But professors and research are no longer seen as heroes – quite the opposite sometimes – with entrepreneurs the new kings.

This does not mean research is not important; it underpins almost every productivity-enhancing advancement made in the modern world. But in many developed economies, the indirect connection of research to the advancements seen by society has brought into question the usefulness of university research.

In Australia, successive governments have emphasised the need to undertake research directly connected to the needs of the country and of industry, and they have put their money where their rhetoric is. From 1992 to 2020, Australia’s investment in pure basic research has dropped from 40 per cent of the government’s total spend to 19 per cent, with the combination of pure and strategic basic research dropping over the same period from 64 per cent to 37 per cent. In 2021 the acting education minister even intervened in what arguably was already a beleaguered pure basic research pool, by refusing to support six recommended grants that he felt did not meet the national interest. This was quickly followed by a stringent national interest test for all grants that requires a direct connection to societal outcomes. What has been the principal government funding mechanism for basic research, the Australian Research Council, was no longer allowed to fund basic research. Sensibly, the current Education Minister has recently reversed this decision. But such interventions show how tenuous funding for basic research can be. While Australia has been at the leading edge of these interventions within advanced economies, similar pressures occur across most of the Organisation for Economic Cooperation and Development (OECD).

Many of these interventions are counterproductive, but universities cannot continue to pretend that we can operate like it is 1946 given the massive increase in our societal role accompanied by an associated economic investment. For nearly 1,000 years, universities have had a monopoly on higher education. They have advanced, curated and stored human knowledge, and been given exclusive rights to grant most types of degrees. Given the nexus of education with the advancement of knowledge, this arrangement has remained unchallenged.


Universities’ unique lock on higher education is now being challenged, largely because academic expertise is no longer required (or being used) by other education institutions to teach the types of offerings they provide to many millions of students around the world. Given the large amount of money being spent on education, commercial opportunities abound for companies to use their lower cost structures and agility to provide educational offerings that outcompete much of the university sector’s offerings.

If this plays out as the fundamentals suggest it should, it will be devastating for the sector, because teaching activity has been used to fund much of the sector’s research activity and serves as the financial underpinning to academic freedom and tenure in many institutions. Some elite universities have sufficient endowments and government research funding to be inoculated against this threat. But most research universities will need to evolve. This means ensuring that their research funding is tied to their research, whether through truly delivering research-led teaching that remains attractive to students, or through securing direct funding of their research from government, business and philanthropy.

Publicly funded universities remain essential institutions for the advancement of knowledge, and the value of fundamental research is consistently shown to have large economic spillover. Much of this value is indirect, and flows through the economy in a multitude of ways. Covid-19 vaccines are an illustrative example. Basic university research provided the underpinnings of all the rapidly developed vaccines – a beautiful, but rather rare, direct connection between basic research and impact. The value of the vaccines is not primarily gauged by the profit and loss statements of AstraZeneca, Pfizer and Moderna, but rather the dramatic positive effects their existence provided to people’s lives and economies around the world. These indirect benefits far exceed the direct commercial benefits. Unfortunately, these stories aren’t easy to tell. The future of research depends not only on universities making sure that our research benefits all of society, but that all of society also understands and appreciates that benefit.

It is essential that basic research, as a public good with immense value, remains appropriately funded by government. Knowledge creation for its own sake as a human endeavour is worthwhile in its own right, but it is the advancement of human prosperity that attracts the hundreds of billions of dollars spent each year. Governments’ insistence that universities maximise impact is not unreasonable, but it will not happen through populist, knee-jerk policies that are counterproductive. Rather, genuine collaboration between universities, government, business and NGOs will be the key to success.

John Curtin School of Medical Research, Australian National University

Government has a critical role. The market is very good at efficiently making money from the opportunities it can capture, but government has to drag opportunities across the valley of death, from where they don’t warrant commercial investment, to where they do.

So much of the value of research’s societal impact will not be commercial, and government must help steward this type of translation from ideation to implementation. Getting government policy settings right will be country-specific, but given what is at stake, far more attention and effort needs to be placed on this than is done currently.

In all cases, the expertise required to create and translate research effectively exists both inside and outside universities. This means providing the opportunities and incentives for researchers to move across the two domains. While basic research thrives with minimal interference to the researcher, applied research needs to be outcome-driven, and held accountable to specific and appropriate milestones. It is imperative that the accountabilities between the two modes or research are not mixed if we are to get the most out of our research funding.

Research has been critical in creating an unprecedented improvement in the global human condition over the past 75 years, but this improvement has been achieved by using more of Earth’s resources than is sustainable. Humanity’s continued improvement in prosperity requires research across all domains to ensure geopolitical stability, and that globally we operate in a way that is not only sustainable in the long term but pays off the substantial environmental debt accrued in the past that hangs over our future. The importance of research for the future is clear, but the question remains. Are we prepared to invest in and evolve the research ecosystem so it can deliver what humanity needs over the coming decades?

Professor Brian P. Schmidt is vice-chancellor and president of the Australian National University and won the 2011 Nobel prize in physics for his work on the expanding universe.


Print headline: Fundamental needs

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