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The federal government has launched its National Innovation and Science Agenda, which wraps up A$1.1bn of investment and 24 separate initiatives intended to help Australia transform from a resource-focused nation to an innovation economy.
The wide-ranging agenda supports everything from coding in the classroom and encouraging children to consider science, technology, engineering and maths (Stem) careers, through to tax breaks for angel investors, a new uncapped entrepreneur’s visa and a radical overhaul of the country’s insolvency rules that will take Australia closer to a US-style Chapter 11 regime.
It has also reworked the rules for university grant allocation and encouraged a series of initiatives intended to support greater workforce diversity.
Widely anticipated since Malcolm Turnbull took over as prime minister in September, the agenda has been praised as an important first step.
KPMG said it was a signal that the government was “finding its innovation mojo”. In a more conservative response, the Australian Information Industry Association’s CEO, Suzanne Campbell, noted that the agenda was an “important, tangible step in changing the national mindset on the role of innovation and entrepreneurship in Australia’s economic success”.
But she warned that “it’s now up to industry to find the opportunities in the agenda”.
And there seem to be plenty. First, for investors who have won themselves A$106m worth of tax incentives.
KPMG partner Grant Wardell-Johnson said this could help address the funding problems that startups face when looking for funding in the A$2m-A$40m range.
Turnbull said the tax incentives, coupled with an uncapped entrepreneur’s visa, were critical to Australia’s vision.
“One of the things we have learned is that if you start a new business and it goes well for a while then does not succeed, you may have lost some money but the overall economy massively benefits – you are wiser, your investors are wiser, the economy is wiser,” he said. “We have got to be more prepared to have a go and embrace risk.”
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Accordingly, the government has also announced plans to relax the rules around insolvencies, which would remove a declared bankrupt from the market for one year, rather than the current three, and promote opportunities for genuine turnaround attempts.
In the past, said Turnbull, Australia’s insolvency laws operated to actively incent directors to put a business in the hands of administrators when a problem arose. “The changes we are proposing to adopt will protect creditors and shareholders. It takes us some way, but not all the way, to the Chapter 11 system,” he said.
Smaller technology companies will also be able to showcase and sell their wares and services to the government on an online marketplace that the prime minister has asked the Digital Transformation Office to construct.
According to John Ruthven, president and managing director for SAP ANZ, it’s not just startups and small businesses that will benefit from the new innovation agenda. He said the collaboration being promoted, even demanded, between business, academia and government, would have a much broader impact.
“The disruption of whole industries is very real. It’s time to establish an economy based on innovation, so that Australia leads this disruption and no longer only reacts to it,” he said.