EXPLANATORY NOTES


DATA SOURCES

1 The statistics presented in this release have been compiled from data collected from higher education institutions in the Survey of Research and Experimental Development in respect of the year ended 31 December 2006.

2 Gross Domestic Product (GDP) and Gross State Product (GSP) figures used to derive HERD/GDP and HERD/GSP ratios are referenced in the tables below.

Gross Domestic Product, current prices
	1996-97	1998-99	2000-01	2002-03	2004-05	2006-07
	$m	$m	$m	$m	$m	$m
GDP	545 698	607 759	689 262	781 675	897 642	1 046 903
Source: National Income, Expenditure and Product, December Quarter 2007 (cat. no. 5206.0)

Gross State Product, current prices
	NSW	Vic.	Qld	SA	WA	Tas.	NT	ACT
	$m	$m	$m	$m	$m	$m	$m	$m
2004-05	300 636	225 129	159 778	61 607	102 646	17 637	11 380	18 828
2006-07	335 144	247 440	195 704	69 540	141 368	21 088	14 494	21 586
Source: Australian National Accounts, State Accounts (cat. no. 5220.0)

3 Financial year GDP and GSP data are used to ensure consistency with ratios published in Research and Experimental Development, All Sector Summary, Australia (cat. no. 8112.0).


DEFINITIONS

4 R&D as collected by the ABS is defined in accordance with the OECD standard as 'creative work undertaken on a systematic basis in order to increase the stock of knowledge, including knowledge of man, culture and society, and the use of this stock of knowledge to devise new applications'.

5 Types of R&D activity comprise pure basic research, strategic basic research, applied research and experimental development. See the Glossary for further details. Data in this classification are subjectively allocated by data providers at the time of reporting, using OECD/ABS definitions. The ABS makes every effort to ensure correct and consistent interpretation and reporting of these data and applies consistent processing methodologies. Analysts using these data should bear the original subjectivity in mind.

6 For a more comprehensive interpretation of the definition of R&D activity, see the Australian Standard Research Classification (ASRC), 1998 (cat. no. 1297.0) or refer to the OECD publication Proposed Standard Practice for Surveys on Research and Experimental Development ('Frascati Manual' 2002).


SCOPE AND COVERAGE

7 The OECD definition of the higher education sector encompasses universities and other institutions of post-secondary education regardless of their source of finance or legal status. The scope of the ABS R&D survey is based on the OECD definition, but excludes colleges of Technical and Further Education.

8 All research activity performed by in-scope institutions during the reference period, irrespective of the source of funds, is included in the survey. This includes research performed by institutions:

• as a participant in unincorporated Cooperative Research Centres (CRCs); and
• on contract for other legal entities (such as private business or incorporated CRCs).

9 R&D performed on an institution's campus by other legal entities (such as incorporated CRCs or university controlled entities) or employees of other organisations, is excluded from the survey. The R&D performed by these entities and their employees will be in scope of the relevant R&D sector (Business, Government or Private non-profit).


LOCATION OF R&D

10 Data shown in this release represent the main campus or head office location of the reporting institution, with the exception of the Australian Defence Force Academy (ADFA) which is shown against the Australian Capital Territory.


SOCIO-ECONOMIC OBJECTIVE (SEO) AND RESEARCH FIELDS, COURSES AND DISCIPLINES (RFCD)

11 Statistics classified by SEO and RFCD have been collected and presented in this release. Data are subjectively allocated by institutions at the time of reporting. See the Technical note on Reliability of statistics for further detail. For more information on these classifications, see the Australian Standard Research Classification (ASRC), 1998 (cat. no. 1297.0).


DERIVED EXPENDITURE ESTIMATES

12 Total cost of R&D undertaken is equivalent to direct expenditure plus indirect (overhead) expenditure.

13 In compiling R&D statistics, institutions were asked to provide data on:

• direct staff inputs (i.e. staff directly performing R&D);
• direct expenditure (i.e. expenses directly attributable to R&D); and
• other staff and resources supporting, but not directly performing, R&D.

14 Institutions were also required to indicate whether overheads had been included in reported data. In cases where data did not include overheads, an estimate was calculated by either:

• the institution identifying the value of R&D related overhead costs to be apportioned across relevant projects/schools; or
• the ABS, using a methodology agreed to by institutions and the Australian Vice-Chancellors' Committee (now Universities Australia).

CHAIN VOLUME MEASURES

15 The chain volume measures appearing in this release are annually reweighted chain Laspeyres indexes referenced to the current price values in a chosen reference year (currently 2005). They can be thought of as current price values re-expressed in (i.e. based on) the prices of the previous year and linked together to form continuous time series. They are formed in a multi-stage process of which the major steps are described in Section 15 of the Information Paper: Introduction of Chain Volume Measures in the Australian National Accounts (cat. no. 5248.0).


RELATED RELEASES

16 Users may also wish to refer to the following ABS releases:

Australian Standard Research Classification (ASRC), 1998 (cat. no. 1297.0)
Innovation in Australian Business, 2005 (cat. no. 8158.0)
Research and Experimental Development, All Sector Summary, Australia, 2004-05 (cat. no. 8112.0)
Research and Experimental Development, Businesses, Australia, 2005-06 (cat. no. 8104.0)
Research and Experimental Development, Government and Private Non-Profit Organisations, Australia, 2004-05 (cat. no. 8109.0)
Summary of IT Use and Innovation in Australian Business, 2005-06 (cat. no. 8166.0)

17 Relevant OECD publications include:

Main Science and Technology Indicators 2007/2
Proposed Standard Practice for Surveys on Research and Experimental Development ('Frascati Manual' 2002)

ABS WEBSITE

18 Other information, including data cubes in spreadsheet format, relating to R&D and innovation can be found on the ABS website <www.abs.gov.au>. See the Innovation, Science and Technology Home page under Themes/Industry.


ABS DATA AVAILABLE ON REQUEST

19 As well as the statistics included in this and related releases, the ABS may have other relevant data available on request. Inquiries should be made to the National Information and Referral Service on 1300 135 070.


ROUNDING

20 Where figures have been rounded, discrepancies may occur between the sum of the component items and totals.