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8104.0 - Research and Experimental Development, Businesses, Australia, 2009-10 Quality Declaration 
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 08/09/2011   
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QUALITY DECLARATION - SUMMARY

INSTITUTIONAL ENVIRONMENT


Statistics presented in this release have been compiled from data collected by the Australian Bureau of Statistics (ABS) from Australian businesses in the Survey of Research and Experimental Development (R&D), Businesses. The data were collected under the authority of the Census and Statistics Act 1905.

For information on the institutional environment of the Australian Bureau of Statistics (ABS), including the legislative obligations of the ABS, financing and governance arrangements, and mechanisms for scrutiny of ABS operations, please see ABS Institutional Environment.


RELEVANCE

This release presents statistics on R&D undertaken by Australian businesses in respect of the 2009-10 reference period.

R&D statistics produced by the ABS enable the nature and distribution of R&D activity in Australia to be monitored and analysed for policy formulation, allocation of funds and determination of research priorities. The major users of R&D data are Commonwealth and State government organisations, mainly the Department of Innovation, Industry, Science and Research (DIISR) and the Department of Education, Employment and Workplace Relations (DEEWR). R&D data are also used extensively by the Productivity Commission and for international comparison purposes.

Since the release of the 2008-09 Australian System of National Accounts, R&D has been treated as capital formation. This resulted from the implementation of the new international standards System of National Accounts (2008 SNA) and represents a change in treatment of R&D (as intermediate consumption) from SNA 1993.


TIMELINESS

Data are collected on an annual basis, with the reference year being the financial year (i.e. year ended 30 June). Statistics compiled from the data collected are released approximately 15 months after the reference period. Timing of business registration for the AusIndustry administered R&D Tax Concession (used by the ABS to assist in identification of businesses undertaking R&D for inclusion in the survey), currently prevents earlier release of the statistics.


ACCURACY

The Survey of R&D, Businesses is a census of in-scope organisations (refer to the Scope and Coverage section of the Explanatory Notes).

As the survey is a census, the survey estimates are not subject to sampling error. However, other inaccuracies, collectively referred to as non-sampling errors, may affect the data. These errors can result from of a number of factors, including:

  • inadequacies in the collection instrument;
  • treatment of non-response;
  • inaccurate reporting of data by data providers;
  • errors in the application of survey procedures;
  • incorrect recording of answers; and,
  • errors in data capture and processing.

Every effort is made to minimise non-sampling error by careful design and testing of the collection instrument, the use of efficient operating procedures and systems, and the use of appropriate methodologies.

For the Business sector, reliability and comparability of R&D statistics may be affected by the following specific non-sampling errors:
  • Many businesses provided estimates due to a lack of separately recorded data on R&D activity.
  • Some businesses may not have reported data as per the definition of R&D used in the survey. This is potentially a result of slight differences in the survey definition of R&D and those used in: industry R&D schemes for the allocation of grants; and, the AusIndustry administered R&D Tax Concession scheme for tax deductibility for specific R&D activities.
  • Data were self-classified by businesses to Type of activity, Fields of research (FOR) and Socio-economic objective (SEO) at the time of reporting. Some businesses may have experienced difficulty in classifying their R&D projects. The ABS makes every effort to ensure correct and consistent interpretation and reporting of these data by applying consistent processing methodologies.
  • The estimation method of R&D related overheads varied across businesses and reference periods.

Revisions to previous cycle data occur on discovery of:
  • errors in reported data, typically a result of the specific non-sampling errors outlined above; and
  • newly identified R&D performers who indicated they had significant levels of R&D in earlier years (details are collected and used to revise previously released estimates).

Revisions are applied up to two cycles prior to the current cycle, but only where the impact on:
  • R&D expenditure is equal to $5 million or more;
  • Human resources devoted to R&D is equal to 25 person years of effort or more; or
  • Published level data is of proportional significance.

Revisions must be taken into consideration when interpreting results, particularly when comparing estimates over time.

While every effort is made to ensure that all in-scope businesses are included in the survey, complete coverage cannot be guaranteed. The 2009-10 Survey of R&D, Businesses achieved a response rate of 91%.


COHERENCE

There are no other data sources with which ABS R&D data for the Business sector can be directly compared. However, some observations can be made which suggest the survey outputs give a reasonable indication of real world expectations and events. For example, trends in R&D survey data aligning with trends in values claimed, or intending to be claimed, through the R&D Tax Concession Scheme.

While the ABS seeks to maximise consistency and comparability over time by minimising changes to the survey, sound survey practice requires ongoing development to maintain the integrity of the data, its relevance to the changing needs of users and the efficiency of the collection.

Comparability of R&D estimates for the Business sector over time may have been affected by changes in imputation methods, concepts, data item definitions and classifications. For example, ABS R&D collections use classifications specific to R&D which are periodically updated. From the 2007-08 cycle, Type of activity, FOR and SEO data have been collected and compiled based on the Australian and New Zealand Standard Research Classification (ANZSRC), 2008 (cat. no. 1297.0). Prior to this, these data were based on the Australian Standard Research Classification (ASRC). The introduction of updated classifications represent a break in the relevant time series.


INTERPRETABILITY

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'.

The ABS Survey of R&D, Businesses also uses classifications specific to R&D: results presented in this release are based on the ANZSRC 2008.

Data providers self-classify R&D expenditure based on their interpretation of OECD and ABS definitions and classifications. The ABS makes every effort to ensure correct and consistent interpretation and reporting of these data and applies consistent processing methodologies. See also the Reliability of Statistics and Revisions sections of the Technical Note.

Further important contextual information, to be considered when interpreting the results presented in this release, is provided in the Explanatory Notes (including the Technical Note and Glossary).

Additionally, for a more comprehensive interpretation of the definitions and classifications relating to R&D activity, refer to:

ACCESSIBILITY

Findings from the Survey of R&D, Businesses are available in both web and pdf format. In addition to main features (which include key findings commentary), data cubes will be included on the ABS website free of charge by 31 October 2011. For the pdf version of the results, see the Downloads page for this issue. Once available, the data cubes will also appear on the Downloads page.

Links to other data releases relating to the ABS Survey of R&D, Businesses can be found on the ABS website, via the Innovation, Science and Technology theme page under Topics @ a Glance/Industry.

If the information you require is not available as a standard product, inquiries can be made by contacting the National Information and Referral Service on 1300 135 070 or Rebecca Gale on (08) 9360 5179.


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