AUSTRALIA’s housing market is experiencing a peak growth rate, but experts say the current boom won’t last forever. 

In this month’s Finder RBA Cash Rate Survey, 40 experts and economists weighed in on future cash rate moves and other issues relating to the state of the economy. 

While all experts surveyed predict the cash rate to hold, nearly half of those who weighed in on property prices (47%, 16/34) believe Australia’s current house price growth is unsustainable.

Property market growth surged at its fastest rate in 33 years in March, with national dwelling values also increasing by 6.2 percent over the past year according to CoreLogic.  

Graham Cooke, head of consumer research at Finder, said that some experts are concerned a housing bubble is emerging.

“Rock-bottom rates, government stimulus and a fear of missing out have really lit a fire under the belly of the market," Mr Cooke said.

“Listing numbers are unable to meet high buyer demand, keeping inventory levels low overall and adding to the sense of urgency among buyers. 

“We’ve seen more borrowed for housing over the last six months than during any similar period in history – and economists have tipped us to borrow more over the next six. 

“However, the view from our panel is that this fast-paced growth will not continue indefinitely. 

“It’s unlikely we'll see any regulatory intervention from policymakers yet, but this might be a possibility down the track,” Mr Cooke said. 

According to Mala Raghavan of the University of Tasmania, buyers may put themselves at risk by acting too hastily. 

“The recent uptick in buying behaviour largely appears to be due to the fear of missing out, and many buyers are rushing into the market without clear foresight of the impending risks," Ms Raghavan said.

“When mortgage rates start rising, many households will risk being unable to service their loans, and could be vulnerable to foreclosures,” she said. 

A small rate increase could cost mortgage holders $26,000 in interest

While experts agree the RBA is unlikely to increase the cash rate for a while yet, this doesn't mean mortgage holders can rule out an out-of-cycle rate hike. 

UBank announced an out-of-cycle move late last week, increasing its three-year fixed rate from a near market-leading 1.75 percent to 1.85 (an increase of 10 basis points). Westpac also bumped up its fixed-term rates last Friday. 

If a homeowner with the average mortgage of $495,420* experienced a rate hike of 25 basis points from the current average variable rate of 4.27 percdent to 4.52 percent, they would need to pay an extra $878 per year. 

Over the course of a 30-year loan, this would cost them an extra $26,330 in interest. 

Finder’s Consumer Sentiment Tracker, a survey of 7,191 mortgage holders, found a monthly raise of $200 or less would cause financial distress for two in five mortgage holders (41%).

Mr Cooke said that while the cash rate wasn't going anywhere, that did not mean home loan rates would stay put. 

“The last time the cash rate was held for an extended period of 34 months, banks changed their interest rates on average seven times – five of which were increases.

“It’s important that homeowners factor in potential rate increases when applying for a mortgage – keeping a cushion in your budget can keep your budget from getting dicey down the track,” Cooke said.  

Potential repayment increase if banks increased rates by 25 basis points

	Current average variable rate (4.27%**)	25 basis point increase (4.52%)
Loan size	Annual cost	Monthly increase	Annual increase	30-year cost
$250,000	$14,793	$37	$443	$13,287
$495,420*	$29,316	$73	$878	$26,330
$750,000	$44,380	$111	$1,329	$39,860
$1,000,000	$59,173	$148	$1,772	$53,146

Source: Finder, RBA                                                                                                            
*Average owner-occupier mortgage in Australia (RBA)
**Average owner-occupier standard variable home loan rate (Finder) 

Housing affordability sentiment hits all-time low 

Finder's Economic Sentiment Tracker gauges experts' confidence in five key indicators: housing affordability, employment, wage growth, cost of living and household debt.

Positive sentiment around housing affordability (3%) reached the lowest level ever recorded since the Finder survey began in 2018.

On the other hand, positive sentiment around wage growth is at 32%, which is the highest it's been over the last 12 months. 

Mr Cooke said there had been an increase in positivity for all but one economic metric over the last quarter. 

“Economic sentiment is clearly improving, which is a great thing to see," he said. "The only metric trending down is housing affordability, which, while good news for owners, is bad news for potential first time buyers." 

Here’s what Finder's economic experts had to say:

Nicholas Frappell, ABC Bullion: "Conditions will probably shift the timing of a rate rise forward, although it will hinge on wage growth. Lack of wage growth will tend to push rather than tighten back towards 2023."

Shane Oliver, AMP Capital: "While the economy is recovering faster than expected, the RBA is still a long way away from seeing its stated requirements for a rate hike, being a tight jobs market, wages growth well above 3% and actual inflation sustainably within the 2-3% target range. So a rate hike is still a fair way off although I think it will come before the RBA’s expectation for 2024 at the earliest.”

David Robertson, Bendigo Bank: "The RBA will most likely start to tighten policy by an increase in interest rates in early 2023 or late 2022, the timing dependent on the pace and success of vaccination programmes."

Sean Langcake, BIS Oxford Economics: "The labour market recovery has progressed much quicker than the RBA anticipated. But the economy is still a long way from the conditions the RBA have indicated will precede a rate rise."

Ben Udy, Capital Economics: "While labour market outcomes have continued to surprise to the upside the RBA has lowered its view of the natural rate of unemployment so the labour market still has a long way to go before the RBA will be satisfied."

Peter Tulip, Centre for Independent Studies: "Inflation will remain below 2% and unemployment will remain above the NAIRU until 2024."

Mala Raghavan, College of Business and Economics, University of Tasmania: "The cash rate will only start moving upwards when inflation and unemployment rates are comfortably above 2% and below 6% respectively. It might take a while to achieve these targets."

Stephen Halmarick, Commonwealth Bank: "It will take until Q2 2023 or 2024 before inflation is sustainable inside the RBA target range."

Saul Eslake, Corinna Economic Advisory: "I agree with the RBA that it will take some time for unemployment to fall to a sufficiently low level to trigger wages growth fast enough to ensure price inflation sustainably within the RBA’s 2-3% target range - but I suspect that situation may be reached before “2024 at the earliest.”

Craig Emerson, Craig Emerson Economics: "The RBA has indicated it will not increase the cash rate for several years or until the unemployment rate falls to around 4%."

Peter Boehm, director: "It’s steady as she goes for now as far as the RBA's cash rate is concerned. But while the RBA has signalled it will keep rates low for the next two to three years, its hand may be forced if inflation starts to increase. We are already experiencing material house price growth, and now with a shortage of skilled migrant labourers, there is increasing upward pressure on wages. These (and other) factors, if allowed to continue their upward trend, may see interest rates rise sooner than expected."

Angela Jackson, Equity Economics: "While the economy is currently performing strongly, some of the heat from the post-pandemic bounce is expected to dissipate in the second half of 2021, especially given the ongoing border closures. The RBA is expected to maintain its interest rate policy under this scenario."

Mark Brimble, Griffith University: "The economy still requires support and the COVID future is not clear, particularly with problematic vaccine roll out and questions re long term on for quarantine."

Tony Makin, Griffith University: "Australia's interest rate spectrum is ultimately influenced by global factors, most notably US interest rates. Ten year US Treasury rates have risen around 70 basis points since the beginning of the year and will keep rising due to the huge US budget deficit and higher expected inflation. The RBA will be unable to stem this tide."

Tom Devitt, Housing Industry Association: "After a short term burst in activity in 2021 and maybe 2022 as a result of fiscal stimulus, home building and households exploiting their accumulated savings, Australia's economy will still be affected by the same factors that suppressed interest rates, inflation, wages, productivity and economic growth pre-COVID. This includes a world awash in savings, ageing populations and limited private sector investment opportunities. And now we have the addition of suppressed population growth. Even if the government exploits its record-low borrowing costs to invest in the necessary long term infrastructure and reforms, it will take a number of years to get the labour market tight enough to generate the wage growth that will force the RBA's hand on interest rates."

Alex Joiner, IFM Investors: "The RBA will look through any near term inflation and once the stimulus acceleration in growth fades the economy will still be away from full employment - the RBA will have to keep policy accommodative."

Michael Witts, ING Bank: "The timing of the RBA is uncertain, the first half of 2023 is possible at this stage, although the strength of the domestic recovery may see this timeline move forward."

Leanne Pilkington, Laing+Simmons: "While there have been some concerns raised recently about rising house prices and therefore household debt, low rates remain an important foundation for the economic recovery and we believe it's prudent for the Reserve Bank to maintain the course it has previously stated."

Nicholas Gruen, Lateral Economics: "The recovery will be strong and will stimulate some inflation, though it will take some time for it to materialise and longer for it to work its way into expectations."

Mathew Tiller, LJ Hooker: "The RBA has continued to indicate that it will keep the cash rate steady for the time being. This is despite improving economic data and very strong increases in dwelling prices."

Geoffrey Kingston, Macquarie University: "Inflationary pressures are building up more quickly than is generally realised."

Michael Yardney, Metropole Property Strategists: "The RBA has made it clear it won't increase interest rates until unemployment is so low that we get consistent wages growth."

Julia Newbould, Money magazine: "If the economy continues to grow and unemployment stays relatively low the bank might start to increase rates to combat inflation and perhaps cool the property market."

Susan Mitchell, Mortgage Choice: "The economic recovery is supporting remarkable growth in consumer sentiment and we’re seeing record growth in the housing market but we are a long way off any changes to the cash rate. RBA board members were clear in the minutes of the April monetary policy meeting - the cash rate will not be increased until inflation is within the target range, wages growth improves and the labour market strengthens."

Dr Andrew Wilson, My Housing Market: "Clearly no rational case for interest rate move in foreseeable outlook."

Rich Harvey, Propertybuyer: "I think the RBA will move rates up sometime in 2022 as the economy is rebounding faster and stronger than anticipated with stimulus money flowing through and commodity price giving the terms of trade a nice boost,"

Matthew Peter, QIC: "Although headline inflation will lift this quarter and next, most of the rise will reflect transitory effects which the RBA will look through. Core inflation rates will remain low, reflecting low wage growth, and the RBA will keep forward guidance for a first rate hike in 2024."

Cameron Kusher, REA Group: "RBA have their credibility on the line and they will choose to wait longer to be sure that they achieve their inflation and full employment targets. That is still likely to take some time."

Christine Williams, Smarter Property Investing: "The global market will eventually move once the Pandemic is under global control."

Jonathan Chancellor, Urban.com.au: "There's no prospect of any official cash rate move for many months, but home borrowers can expect more increases to long-term fixed rates as banks prepare for the end of the RBA's term funding facility."

Dale Gillham, Wealth Within: "The economy is starting to move in the right direction. However there is still a long way to go with combating COVID and getting back to what is a normal economy again. Therefore we are unlikely to see major growth at a level that is enough to warrant an increase in interest rates."

Other participants: John Hewson, ANU. Jeffrey Sheen, Macquarie University. Alan Oster, Nab. Malcolm Wood, Ord Minnett. Noel Whittaker, QUT. Jason Azzopardi, Resimac. Sveta Angelopoulos, RMIT. Jakob Madsen, University of Western Australia. Bill Evans, Westpac.

ends

AN EXPLORATION FORUM in Brisbane today heard Queensland’s resources industry has "grown exponentially over the past decade" and by an incredible 77 percent in only the past three years.

Queensland Exploration Council (QEC) chair Kim Wainwright said exploration expenditure in Queensland had been robust over most of the past 10 years, apart from a drop in 2015-17, but had been on a steep upward trajectory since 2018. 

“For the past decade, the QEC’s annual Scorecard publication has shown a highly positive explorer sentiment towards resource prospectivity, which is very good news for our industry and a barometer for how well the resources sector is travelling,” Ms Wainwright said.

Today’s exploration forum, which featured Acting Director General of the Department of Resources, Mike Kaiser, as keynote speaker, showcased promising new data and progress reports from four grant recipients under the State Government’s Collaborative Exploration Initiative (CEI).  

Dover Castle Metals used the grant to explore for silver, lead and zinc and potentially one of the highest grades of indium in Australia, using diamond drilling techniques on land about 150km west of Cairns.

Red River Resources undertook low-impact magnetic surveys using drones on land about 100km south west of Cairns to look for silver, lead, zinc and indium deposits, while Aeon Metals explored for deep iron oxide, copper and gold in an area about 100km west of Mount Isa. 

Vecco Group put its grant towards re-analysing drill core samples to identify new economy minerals north of Julia Creek

NEXT BIG DISCOVERY

Ms Wainwright told a gathering of more than 130 explorers, producers, investors, researchers and regulators that Queensland had enormous resources prospects and a skilled workforce focussed on “that next big discovery”. 

“We are fortunate Queensland’s North West Minerals Province is one of the world's richest mineral producing areas containing copper, lead and zinc as well as major silver and phosphate deposits and strong rare earth potential,” she said.

“These minerals are needed to make everyday items such as smartphones and renewable energy products such as wind turbines, electric cars, solar panels and batteries.

“What makes these commodities special is not every mineral jurisdiction has them, and they can be difficult to extract and process economically.”

The forum also heard about the key role Queensland’s critical minerals could play in the development of renewable technologies globally, and the potential for hydrogen to emerge as an alternative fuel and what that would mean for the sector in the future including replacement of diesel equipment and vehicles. 

Ms Wainwright said it was great to see industry, researchers and government working together to unlock the state’s potential, particularly in secondary prospecting and minerals reprocessing. 

COAL STILL TOP OF THE TREE

She said coal was once again Queensland’s leading resource target in terms of exploration expenditure over the past year. 

“In the final quarter of 2020, Queensland mineral exploration expenditure was $101 million, and coal accounted for more than half of that,” she said.

“This is the highest coal exploration expenditure we have seen in seven years and provides an insight into just how valuable the coal industry is to the Queensland economy.”

Ms Wainwright said minerals such as gold and copper made up the other half of minerals exploration expenditure in the September 2020 quarter, with a historically strong price continuing for gold in particular. 

The Exploration Initiatives for the Future forum heard that ABS figures showed more than $640 million was spent in Queensland on mineral and gas exploration in 2019-20.

“Given exploration spend typically correlates positively with strong commodity prices, the QEC expects the next ABS data release on March 1 to confirm a further increase in overall exploration expenditure in Queensland in 2020-21, so it looks like this upward trend will continue,” she said.

Content from the event will be published on the Queensland Resources and Exploration Gateway www.qurex.com.au

ends

THE ADVENTURES of Indiana Jones have nothing on Queensland’s current crop of intrepid explorers, who are venturing to the far ends of the state’s north and north-west to discover the critical minerals needed to lower world carbon emissions.

Queensland Exploration Council (QEC) chair Kim Wainwright said Queensland has vast potential to provide the critical minerals and rare earths needed to manufacture everyday items such as smart phones and renewable energy products such as wind turbines, electric cars, solar panels and batteries.

Ms Wainwright will tell industry leaders, researchers and regulators at the QEC’s annual forum in Brisbane on Friday (February 19) the world urgently needs new discoveries of minerals such as copper, gold, vanadium, bauxite, silver, lead, zinc, indium, cobalt and coal to support the development of renewable energy technologies. 

She said ABS figures show more than $640 million was spent in Queensland on mineral and gas exploration in 2019-20, with mineral exploration expenditure alone hitting a seven-year high in the September 2020 quarter to reach $101 million.

“The QEC expects the next ABS data release on March 1 to confirm a further increase in overall exploration expenditure in Queensland in 2020-21, so it looks like this upward trend will continue,” Ms Wainwright said.

Ms Wainwright said most exploration expenditure in the past year has been in coal and base metals such as gold and copper, particularly in the Central Queensland region.

“Central Queensland is the beating heart of the Queensland resources sector and is where our largest and most valuable coalfields are located,” she said.

“We also have large gas resources, some that already overlap our coal operations and others such as in the Galilee Basin that are still being tested but show positive signs of future development.”

The State Government is well aware of the emergence of Queensland as a global supplier of critical minerals, committing $29 million in the 2020-21 budget towards Collaborative Exploration Initiative (CEI) grants and COVID-19 support measures such as rent relief for land under exploration.

This includes $9 million to support critical minerals discovery in the North West Minerals Province and an expansion of the CEI to include a broader range of regions. 

“The latest CEI grant round received almost 150 applications, with 20 companies awarded an exploration support grant of up to $200,000 each,” Ms Wainwright said.

“This is the largest CEI round to date and reflects how eager explorers are to get on the ground and make that next significant discovery.

“Critical minerals are just what the name suggests -- they are critical to defence, battery and energy storage and overall cutting-edge technology,” Ms Wainwright said.

“What also makes them critical is not every mineral jurisdiction has them, and they can be very difficult to extract and process economically.

“What is unique about Queensland is that we have significant deposits of a whole range of critical minerals available, as well as the local expertise and experience to meet the challenge of providing these minerals to the world.”  

This year’s QEC exploration forum will feature presentations by four CEI grant recipients - Vecco Group, Aeon Metals, Red River Resources and Dover Castle Metals – who will share early, and what looks like promising, exploration results. Under the terms of the grant, recipients are required to share all results and data publicly to support the industry’s continuing development.

CEI grant recipient details:

Dover Castle Metals - funding used to explore for silver, lead and zinc and potentially one of the highest grades of indium in Australia using diamond drilling techniques on land about150km west of Cairns.

Red River Resources - funding used to undertake low-impact magnetic surveys using drones on land about 100km south west of Cairns to look for silver, lead, zinc and indium deposits.

Aeon Metals - funding used to explore for deep iron oxide, copper and gold in an area about 100km west of Mount Isa.

Vecco Group - funding used to re-analyse drill core samples to investigate if there are any new economy minerals north of Julia Creek

To register for this Friday’s QEC “Exploration Initiatives for the Future” forum click here.

ends

CSIRO chief executive Larry Marshall, in his recent address to the National Press Club, issued the call to Australia to rally around a set of national missions that aim to solve challenges and drive Australia’s economic recovery and future resilience. Here is the text of his presentation.

 

THERE ARE MOMENTS in time that shape generations – the generation who harnessed electricity; the generation who saw humans walk on the Moon; the generation who sw itched on the internet.

Moments driven by science.

This generation is living through a perfect storm of bushfires, pandemic, and recession.

Never in our lifetime has a country – or the world – turned to scientists in the way they are now.

This is our moment. Our moment in time that will shape our generation.

History will judge us by what we do next, and our children will live with the consequences.

Science has the unique and wonderful ability to unite people around a mission to achieve things that were once thought impossible.

The 1969 Moon Mission galvanised the public, inspired rafts of other inventions we now use in our everyday lives, and achieved something no one thought possible when it was announced. 

The rocket may have launched in the United States, but Australia enabled the mission through our Dish in Parkes, which was listed on the Heritage Register this week, and NASA tracking stations across Australia.

The 1988 Global Polio Eradication Initiative launched a global mission to eliminate polio, and by 2016 reduced the number of people paralysed by 99.99 percent.

Again Australia was a leader in this global mission, becoming polio-free 16 years earlier in 2000, the same year Sydney hosted the Olympics.

Today we have that same opportunity to rally research, industry, and community, around a new mission enabled by science – a mission of recovery and resilience.

Do we do things the same way as we did before this moment, or do we forge some bold new ground?

Science helps us see into the future to understand what that ground might be, and to prepare for future threats.

NATIONAL PREPAREDNESS

COVID-19 and the devastating bushfires of last season have brought into sharp focus the role of science in national preparedness, and in our ability to weather future crises.

But it’s important to understand that this doesn’t just happen – it involves foresight, planning, and investment in the right areas.

The reason CSIRO was able to hit the ground running on COVID-19 was because our research and modelling foresaw the threat of a pandemic four years ago, and weprepared for it.

We shifted to a ‘One Health’ model that recognises the complex interactions between humans, animals and our environment, and put it into action at our Australian Centre for Disease Preparedness, the only high bio-containment facility in the southern hemisphere.

We invested in data modelling and Artificial Intelligence to reinvent the way we do our genetics research.

And we expanded our global and domestic ties in infectious disease with partners like CEPI, the Coalition for Epidemic Preparedness Innovations, as well as local disease experts at James Cook University, the University of Queensland, The Doherty Institute and many others.

We also foresaw the need for agile manufacturing and invested in developing this capability for Australia.

This gave us an advanced biologics manufacturing facility to scale-up vaccine candidates, like we did with the University of Queensland, as well as the capability to scale-up a pilot facility to overcome the shortage of crucial safety products like face masks.

Last week that pilot facility became Australia’s first accredited face mask testing facility, meaning local manufacturers can test critical medical supplies here rather than sending them overseas for accreditation.

We also foresaw the threat of a warmer, dryer climate and invested in adapting our bushfire planning to incorporate climate change projections.

This, together with our expertise in modelling and 70+ years of expertise in bushfire research, meant we were on the front foot to monitor, analyse and advise when the catastrophic bushfires hit.

And Australia is in a stronger position to build back better as a result.

MOMENTS SHAPED BY PEOPLE

Preparation of our facilities and our research was, and continues to be, critical – but the moments that really mattered were shaped by people.

Like the researchers who have attended every major fire event in Australia since Ash Wednesday in 1983 to better predict fire behaviour and help keep our fire fighters and residents safe.

Like the textile manufacturers who worked with scientists to repurpose their factories to fill the desperate need for personal protection equipment against COVID-19.

Like the environmental scientists who transferred their expertise in water pollution to start testing wastewater to locate virus hotspots.

And in Geelong, a city where streets are quiet today with residents back in lockdown, at our Australian Centre for Disease Preparedness, the CSIRO staff who returned from retirement to lend a hand as we work around the clock on a COVID-19 vaccine.

I want to pause here to thank the CSIRO team who have been working tirelessly on this since January, the bushfires team who have been working tirelessly since September, and all the other 5000 people in CSIRO who back them up.

I also want to thank our partners at Australia’s 39 universities, across countless government departments and in industry who have stepped up to play their role.

And of course, all Australia’s frontline workers over this difficult year – the fire-fighters and SES, the doctors, nurses and all healthcare workers – whose daily burden we try to ease.

We are all in this together, and we all have a role to play in shaping our future.

WORKING TOGETHER

History has shown us that when we work together to harness the power of science, we can overcome incredible challenges.

100 years ago, we were a nation ravaged by Spanish Flu, cut off from the world by oceans, andsuffering in the aftermath of World War 1, pandemic and recession.

But Australians stepped up to build our fledgling nation, and together we emerged and prospered.

Around the same time, the invasive cactus known as Prickly Pearwas choking an area of Australia’s richest farmland the size of the United Kingdom.

Farmers were abandoning their properties, livestock and wildlife were injured and dying, and our national food bowl was turning into a desert, threatening our very ability to feed ourselves.

A newly formed CSIRO – created to use science to redefine our future – was given its first national mission.

Scientists worked with farmers, government departments and communities on a biological control response, and identified a solution in the brown-grey Cactus Moth, which soon nibbled the problem into oblivion.

As CSIRO grew, its purpose quickly became clear: to solve Australia’s greatest challenges through innovative science and technology.

It’s a purpose we’ve never wavered from, and in 2020 our purpose has never been clearer or more important.

As we look to the future and our road to recovery, there are some big challenges we must take on that are larger than any one group or organisation. We can only tackle them together, as Team Australia.

Efforts to find a vaccine for COVID-19 and ‘flatten the curve’ and contain the disease have sparked unprecedented levels of collaboration between research, industry, government and communities all working in their own way to achieve a common goal.

If we can harness this level of collaboration and goodwill and fo cus it on a mission of recovery and resilience, we can accelerate our recovery, create new jobs, and grow our economy.

OUR CHALLENGES

We are at one of those rare moments in history where the decisions we make now have the power to change the course of our future.

Decisions that could be the difference between the future we want, or some other kind of dystopia.

It reminds me of the Back to the Future movie series, only unlike Marty McFly and Doc, we don’t have a time machine.

We can’t go back and change the past, and we can’t fast forward to see how our decisions will play out.

We are living in a real-life, high stakes scienceexperiment, and we need to use evidence to make our next move.

CSIRO has been working on that evidence for some time.

I mentioned that four years ago we made changes to prepare for a pandemic and for bushfires – that’s because part of CSIRO’s role is to stay ahead of both threats and opportunities for Australia.

We produced a series of industry roadmaps that informed our preparation, and last year these culminated in the landmark Australian National Outlook report – the first time science has been used to plot a path to prosperity for an entire nation.

In addition to forecasting a bright future for Australia if we make the right investments, it also predicted the slowdecline of our great industries if we don’t reinvent them.

Critically, it detailed the six great challenges we face as a nation if we are to secure our wealth and way of life.

1. Our environment – how do we make sustainability profitable, so industry and environment become partners, not competitors?
2. Our food security and quality –how do we give Australian exports an unfair global advantage?
3. Our health and wellbeing – how do we prevent more Australians from joining the 11 million currently suffering chronic disease?
4. Our future industries – how do we create new, high-value Australian industries, and reinvent old ones so our children even enjoy better lives than we have?
5. Our energy – how do we navigate Australia’s transition to zero emissions, without derailing our economy?
6. And our national security – how do we protect Australia from risks like cyber viruses and biological ones, so we can grow in both the digital and real world?

These are big, broad themes – but we don’t need to look any further than this year’s drought, bushfires, pandemic, and now recession, to see they aren’t just abstract ideas.

MISSIONS ANNOUNCEMENT

And so today, we are announcing a new program of missions to support Australia’s future.

They will help us deliver on our six great challenges and accelerate the pace and scale at which we can address each one, focused on outcomes that lead to positive impact, new jobs and economic growth.

Each mission represents a major scientific research program aimed at making significant breakthroughs, not unlike solving Prickly Pear, curing the rabbit plague, inventing the first flu treatment, or creating fast WiFi.

But let me stress, these are not just CSIRO’s missions.

Their size and scale require us to collaborate widely across the innovation system, to boldly take on challenges that are far bigger than any single institution.

We are working with government, universities, industry and the community to co-create and deliver these missions.

Some will be led by CSIRO, and some will be led by others, but all will have the collective focus of our science, technology and investment.

We will commit at least $100 million annually to this program, and we are calling for partners to join us in a Team Australia approach to solve our seemingly unsolvable challenges.

The missions under development for Australia imagine a future where we use science to amplify Australia’s global advantages and strengths.

A future where we save the 170 billion of export dollars we already create from coal, LNG and iron ore by building an Australian hydrogen industry to reduce the emissions but not the profits from a key pillar of our economy.

Where we transform Australian mineral commodities into unique, higher-value products like critical energy metals that deliver higher profit and sovereign supply.

Where we become a collaboration nation by doubling the number of Australian small and medium businesses utilising Australian science by 2025, so the tech jobs grow here, not elsewhere.

A future where we safeguard the health of our waterways and monitor the quality of our water resources from space using AquaWatch, by 2026.

Where we grow our trusted agriculture and food exports to $100 billion in this decade, by recapturing billions of dollars lost as others fraudulently trade on Australia’s reputation for food safety and quality; by protecting billions of dollars in helping our farmers overcome drought; and in generating billions of dollars in new industries, like in sustainable protein.

A future where we enhance the health and wellbeing of every Australian, regardless of where they live in this wide brown land.

Where we overcome antimicrobial resistance to ensure antibiotics keep saving lives despite the rise of drug-resistant superbugs.

Where we have infectious disease resilience built in to everything we do.

A future that makes protecting the environment not just important, but profitable.

Where we end plastic waste entering our environment, by reinventing the way plastic is made, processed and recycled.

Where we leap towards net zero by establishing the first net zero emissions region in Australia.

And of course, all these missions imagine future industries augmented and accelerated by technology.

For example in manufacturing, where humans work with machines to create something better than either could do alone.

A future where artificial intelligence (AI) and robotics, controlled by a skilled Australian workforce, enable truly agile manufacturing, where a factory can produce unique high margin products in good times, but rapidly switch to supply critical needs in a crisis.

These missions build a future where our children have rewarding and sustainable jobs, in unique and resilient industries, that secure Australia’s wellbeing and prosperity for generations to come.

Not every part of CSIRO is reflected in these mission areas – but every part of CSIRO is working on Australia’s future resilience.

We remain committed to our existing programs of work, in areas like bushfires, preserving the Great Barrier Reef, in disaster resilience, and of course the many ways we are fighting COVID-19, and catalysing greater translation of research into economic benefit.

The missions are about preparing for things that haven’t happened yet, and getting the right structures, programs and partnerships in place to tackle them before they do.

There are a lot of smart people in Australia. We are reaching out to them each and every day to help us get this right. You’ll hear more from us and them as each mission is ready for launch.

DIFFERENTIATION

While this program of missions is new, the use of science to reinvent and differentiate our industries is not.

Science has been doing this for years.

We are still a small population, but we are a smart one. We cannot compete on size or scale – our future must be about differentiation.

Science has the power to revitalise our industries, but you might say at times our science itself is just a commodity.

As brilliant as we are, we still ship it off overseas like a raw material: to be commercialised there, not here; to grow the economy there, not here; to grow jobs there, not here.

But we are changing.

We’ve been reinventing ourselves from a food bowl for Asia to a delicatessen for the world – developing uniquely Australian plants that produce omega-3 fish oil, or used as protein alternative to meat.

We’ve been turning mineral sands worth only pennies per pound, into unique titanium ink worth hundreds of dollars per pound, and using that ink to 3D print custom biomedical devices to save lives, which are priceless.

These are some of the existing breakthroughs that lay the foundations for our missions today.

Missions identify areas where a Team Australia approach can help us use our natural strengths to differentiate our industries and give Australia an unfair advantage in a competitive world.

COLLABORATION, PARTNERSHIP AND IMPACT

By working together, by aligning our efforts, and by pushing each other further for a common cause, we can achieve more – and we can achieve it faster.

We stand shoulder to shoulder with every government department, including with the Department of Agriculture, Water and the Environment, who are represented here today and heavily involved in missions related to climate change, drought, agriculture and biosecurity.

We work with researchers and professors from all Australian universities, including Nobel prize winner, and Vice Chancellor of ANU, Professor Brian Schmidt, who couldn’t be here today but is watching.

We work with multinationals like Fortescue and Microsoft, and state governments like NSW, all of whom are heavily involved in our missions.

And we work with all major Australian industries and thousands of businesses, including small and medium businesses right across our country, like V2Foods, a new company formed using CSIRO science, investment from the CSIRO Innovation Fund, and in partnership with Competitive Foods, to be part of Australia’s growing alternative protein industry.

Partnerships like these are the life blood of our missions, and we will not create impact without them.

Impact is the key word here, because we can’t stop until we put a real solution into the hands of real people who will use it to solve a real problem.

Australia has great research capability and potential to lead in future industries, but we have to get better at translating that research.

If we don’t, our science will continue to be a raw commodity, shipped offshore to create wealth and jobs elsewhere.

We can do it, and that’s not just a hope – it’s a fact, because we’ve done it before.

It’s said that Australia was built on the sheep’s back, and it’s true that wool was once our greatest industry.

But it only became so because Australian science reinvented wool itself.

Before that you couldn’t weave wool, wear a wool suit, or even wash it – Australian science changed all that with a weaving machine to turn wool into clothes for the world.

Today Australia produces some of the world’s best cotton, but 50 years ago cotton wouldn’t grow here – Australian science had to reinvent it.

Then synthetics threatened to replace cotton, so we reinvented cotton again, and strengthened an industry that today employs thousands of Australians and supports rural communities.

The last 30 years of economic growth have lulled us into a false sense of security, and over time business investment in R&D has fallen. But there’s nothing like a crisis to snap us back into action.

Ironically, this recession may be the greatest opportunity for innovation-led growth we’ve had in decades.

TRAVELLING TO THE FUTURE

Even when it ends with a giant leap, every mission begins with one small step.

Small, but innovative breakthroughs in space exploration had been made before we decided we'd go to the Moon – but we had to dream big to get there.

Other diseases had been conquered before we tackled polio – but it took a global push to conquer a new, debilitating disease.

Our world-class Australian science has been inching us forward in exciting steps for years – but it will take big, bold visions to leap forward and realise the vision of our missions.

Our Australian Square Kilometre Array Pathfinder, or ASKAP, and the supercomputers that support it, already process vast amounts of data– so it’s not hard to imagine a future where our children’s jobs could be anywhere in the world, but they choose to live in Australia, supported by fast communications systems conceived right here.

We have already demonstrated liquid renewable fuel from hydrogen – so it’s not hard to imagine them driving to the beach on the weekend in zero-emissions cars fuelled by hydrogen made in Australia.

We can already 3D print food – so it’s not hard to imagine our children 3D printing high-value foods from home, based on their personal health profiles, preventing cancer, diabetes, and improving overall wellbeing.

We have already grown lungs in lab and demonstrated telehealth – so it’s not hard to imagine them accessing top-quality healthcare in their homes, and replacing any troubling organs with personalised replicas, grown in Australian labs.

When you add up each of these small steps, together they become a giant leap.

Australian businesses are already turning these visions into reality using Australian science, from giants like Fortescue investing in hydrogen, a thriving spin-out called Coviu transforming telehealth.

It’s a bright vision – but like Marty and Doc in the DeLorean, there is an alternate vision as well, one we might wish we could undo by returning to this moment.

Our Australian National Outlook and industry roadmaps predict the decline of each of our great industries if we don’t reinvent them, and our six great challenges identify areas where we need to invest tosecure our future.

Missions are the way we will do that, but we must act now, with purpose and resolve, to have impact.

COVID-19 will continue to disrupt, but Australia can harness this disruption to build a stronger, more resilient country in the process.

This is important, because there will be more pandemics and more disruption.

As we head into National Science Week in a few days, there has never been a more important time for science, and its power to unite us around big, visionary programs that make the impossible, possible.

We have an opportunity to treat 2020 like a call to action – albeit a dreadful one – to come together as we did 100 years ago, and focus our collective efforts and resources on solving our future challenges to secure our jobs, wealth and way of life.

Others have harnessed electricity, walked on the Moon, switched on the internet.

This is our moment. This is our time. This is our future.

It’s time to leap.

 

www.csiro.au

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