The Federal Government will “carefully consider” a strategy, prepared by Innovation and Science Australia (ISA), to transform Australia into a “top tier innovation nation” by 2030, Minister for Jobs and Innovation, Michaelia Cash has announced.
Released this week, ISA’s Australia 2030: Prosperity Through Innovation report contains 30 recommendations for creating a high performing innovation system, with Minister Cash stating that the overall plan builds on the government’s National Innovation and Science Agenda. Some of ISA’s recommendations for government include:
- Improving the education system to better prepare students for STEM (science, technology, engineering and mathematics) occupations and otherwise equip Australians with skills relevant to 2030.
- Reversing a decline in business expenditure on research and development (R&D) by better targeting government support including grants and the R&D Tax Incentive program.
- Increasing funding for the Export Market Development Grants (EMDG) program and making better use of trade agreements to accelerate exports by young, high-growth firms.
- Prioritising investment in artificial intelligence (AI) and machine learning to capitalise on opportunities presented by the ‘fourth wave’ of the internet.
- Improving access to global talent pools by ensuring flexible skilled migration rules and increasing the profile of Australia as an attractive destination for ‘business builders’.
- Creating a more flexible regulatory environment where Australian governments collaborate to support innovation.
- Improving conditions for social impact investing to encourage investors to pursue opportunities that generate both financial and social returns.
- Establishing a small and medium enterprise (SME) procurement target of 33 per cent of contracts (by dollar value) being awarded to Australian SMEs by 2022.
- Improving access to – and usefulness of – open government data to better enable companies to create financial value.
- Introducing a collaboration premium in the R&D Tax Incentive program to incentivise collaboration between the research sector and industry and drive stronger commercialisation outcomes for R&D.
- Producing an ‘innovation precincts’ statement to shape its involvement in emerging localised innovation ecosystems in cities and regions.
The report has been welcomed by the peak body for Australian startups, StartupAUS, whose CEO Alex McCauley called for the “swift translation of the recommendations into tangible policy action”.
“This is a great report, but we can’t leave it till 2030 to do something about it,” he said.
“This is a time of critical importance for innovation in Australia. We already have a roadmap established, through the StartupAUS Crossroads Report, to Australia becoming one of the best places in the world to build a high-growth startup. What we need now is rapid action in a number of key policy areas to capitalise on the momentum we have built. This is not only of paramount importance for the sector, it will help secure the economic future of the country,”
Commenting on ISA’s call for improved access to global talent pools, McCauley encouraged the government to update the list of occupations for which skilled visas are available to address the IT skills shortage.
“Rather than presenting a threat to Australian workers, overseas IT workers are helping Australian startups bridge the skills gap and at the same time providing management and product development experience to Australian tech companies as they scale and begin to enter global markets,” he said.
“The focus on STEM and education, while too slow to help in the next few years, is also a critical longer-term step to improve our talent inputs by 2030.”
Although McCauley welcomed the recommendation for the R&D Tax Incentive program to be better targeted to reverse a fall in R&D spend, he said it was critical that the scheme not focus only on the ‘Research’ side at the cost of ‘Development.’
“A clear declaration that commercial development from Australian startups, particularly in the software space, will continue to be covered by the scheme would go a long way to providing clarity and certainty for founders,” he said.
“StartupAUS would also like to see the Federal Government change payment of the R&D incentive from annually to quarterly to help early-stage startups with cash flow, as outlined in our Crossroads 2017 report. This would help support one of the other key themes of the 2030 Plan – establishing a thriving and sustainable base of high-growth businesses.”
McCauley said better targeting the Export Market Development Grants (EMDG) program to help young, high-growth startups access global markets was ‘exactly the right move’ given that only 35% of large scaleups are taking advantage of the program.