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Science and Research3.3 Higher Education R&D

3.3.1 Higher education resources devoted to R&D (HERD) by type of activity

Total HERD, that is spending on R&D performed by Australian higher education organisations, contributed about 34 per cent to Australia's total spending on R&D in 2017–18.[85] As a share of GDP it remained stable at 0.62 per cent over the two year period from 2016 to 2018 (data not shown). Applied research, the largest category within HERD, relates to original investigation undertaken in order to acquire new knowledge. It is directed primarily towards a specific practical aim or objective, rather than purely the acquisition of new knowledge which is the goal of basic research.[86] In 2018, nearly half of the research activity in the higher education sector was Applied research ($5.9 billion or 48 per cent of total HERD). Its share, as well as its dollar value, has increased steadily since 1992 when it was only $514 million or 30 per cent of total HERD. By contrast, Pure basic research recorded $676 million in 1992 and grew to only $2.8 billion in 2018. Its share of total research activity has declined from 34 per cent to 23 per cent over this time period.[87]

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3.3.2 Higher education resources devoted to R&D (HERD) by location

Roughly 60 per cent of total HERD is located in just two states — New South Wales and Victoria — and this geographical concentration has increased over the last two decades. Victoria has increased its share by 5.6 percentage points to 28.2 per cent in 2018 and New South Wales increased its share by 1.8 percentage points to 30.9 per cent. Conversely, the Australian Capital Territory has almost halved its share of total HERD from 11.0 per cent in 2000 to 6.1 per cent in 2018.[88]

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3.3.3 Higher education resources devoted to R&D (HERD) by source of funds

There has been a sustained growth in total HERD over the last two decades. Total HERD was nearly $12.2 billion in 2018 with a significant contribution coming from General university funds. Over the last 20 years, this source has increased from $1.8 billion in 2000 to $6.8 billion in 2018, but as a share of total HERD this funding source has decreased from 63 per cent in 2000 to 56 per cent in 2018. Much of this contraction is due to increased Other Commonwealth government funding from just under 6 per cent in 2000 to over 15 per cent in 2018. It is now the second largest source of funds.[89]

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