Changing Fortunes: A brief history of CSIRO funding from treasury and external sources, 1926 to 2015

The proportion of funds received by the Commonwealth Scientific and Industrial Organisation (CSIRO) from sources other than Treasury, referred to as external earnings, has been used by the Australian government as an indicator of CSIRO's engagement with industry and contribution to the economy. Two periods of decline in external earnings in the 1940s and the 1980s were followed by enquiries into the organisation's purpose and operation, amendments to CSIRO's enabling legislation and introduction of measures to improve industry engagement. After 1988 these measures included a 30% external earnings target. External earnings subsequently rose from 24% of total revenue in 1988/89 to average 36% over the period to 2014/15, peaking at 51% in 2011. Following a review in 2002 the target was removed due to its unintended consequences that included encouraging competition with private industry, placing emphasis on earning capacity over public good, and acting as a disincentive to innovation and collaboration.