Prime minister Malcolm Turnbull today announced his “ideas boom”, the innovation plan set to revolutionise Australia’s startup scene and investment processes.
Along with that the package involves an investment of $1.1 billion over four years to “incentivise, energise, dynamise” Australian industry.
The announcement has had many people talking, particularly entrepreneurs, but also big business.
Business Insider asked some of the leaders at the top of big business in Australia for their thoughts on the prime minister’s ambitious plans. Here’s what they had to say.
Libby Roy, managing director of PayPal Australia
“We welcome the Government’s Innovation Statement and its commitment to support Australian businesses and entrepreneurs to take risks, think big and innovate.
“As a nation we thrive on the success of our 2.1 million small businesses that compete with aggressive competitors around the corner and across the world – for customers, capital and talent. National policies that embrace risk taking, reward initiative and remove barriers will help Australian SMBs and startup entrepreneurs innovate and compete.
“Turning great ideas into profit, jobs and investment requires continuous innovation. To build momentum and move from sporadic to sustainable innovation, Australia needs an environment that supports ‘operationalised’ innovation across key industries.
“Investment in people and in the product development lifecycle will be encouraged by Government policies that support the study of science, technology, engineering and mathematics (STEM) subjects and promote connection between the public and private sectors. The level of reward for innovation should be aligned with the level of risk embraced by investment in new ideas.
“Australian SMBs need ready access to capital to grow, compete and succeed. Advances in the Fintech industry are making it easier and faster for SMBs to access the capital they need to grow where once they wouldn’t have qualified. PayPal is proud to be able to support Australian small businesses in this way.”
Margy Osmond, CEO at the Tourism & Transport Forum Australia
“The Federal Government’s Innovation & Science Agenda is exactly the sort of partnership between government and the private sector we need to be cultivating to maintain and grow a competitive Australia in the post-mining boom economy.
“Science, technology and innovation are the forces that will shape the future of our economic success, we must embrace them and it’s a positive outcome to see the Federal Government starting to embrace this focus.
“Tourism is an industry that is driven by innovation and using cutting edge technology to improve the visitor experience. Market data analysis, bridging the linguistic/language divide and using virtual reality technology to experience a destination before you arrive have been significant examples of new technology being integrated into the tourism offering.
“This Agenda is a starting point. We need to continue the dialogue between industry and the government to expand this strategy to ensure we aren’t missing golden opportunities to support the creation of more jobs and national wealth.
“That’s why TTF joined with other industry groups in agribusiness, financial services, IT and international education last week to form the Future Economy Forum.
“We intend the Future Economy Forum to be a vehicle to allow the industries that will be driving the job creation and economic growth over the next two decades to work with the government to break down regulatory barriers and improve the economic environment – innovation is one of the six key areas we’ve identified as needing attention.
“We look forward to working with the Federal Government to implement this forward looking agenda.”
James Mabbott, head of KPMG Innovate
Culture starts with leadership
“Having the Prime Minister personally championing innovation and entrepreneurship is a major moment in terms of building a real culture of innovation in Australia. This is backed up by a commitment to real action and ongoing ownership through the newly established special committee in cabinet chaired by the Prime Minister. “
The comprehensive scope and vision of the document is important.
“This shows a real recognition that the debate and dialogue about innovation and entrepreneurship is grounded in Australia’s global competitiveness. It continues the theme of the PM’s opening statement on agility, innovation and creativity and shows a marked change in vision for Australia’s future. “
Leading by example
“The commitment from government to leading by example in terms of open data, start-up friendlier procurement practices, and offshore landing pads shows a recognition that the issues to be addressed are not just the responsibility of the commercial sector but systemic. There is also a real innovators mindset at play with a clear indication that the government is prepared to experiment, test and iterate to determine what will work.
“Above all, we need to think big as entrepreneurs and aspire to be global. Our economy is not a closed system and so much of our success is dependent on our ability to participate successfully in the global economy.”
Paul Robson, Adobe’s president for Asia Pacific
“Adobe works closely with all levels of government across the country as they embark on their digital transformation journeys. Digital has disrupted almost every aspect of our lives and it’s promising to see policy initiatives emerging to drive the innovation discussion forward.
“As more people choose to access information online, on any device, and wherever they are, governments and businesses need to transform their way of delivering services and this will be difficult with current skill shortages.
“Adobe’s s annual research into the state of digital across Asia Pacific consistently finds that skill shortages are a major obstacle to digital advancement. Increased investment in skills development will help businesses and governments to drive digital transformation, leading to increased efficiency, business growth and a greater experience for customers and citizens.
“Today’s announcements are a welcome addition to the digital transformation discussion and I look forward to working with the Australian Government, and all governments, to drive the innovation agenda forward.”
Luke Sayers, CEO of PwC Australia
“Three months ago the Prime Minister said the Australia of the future needs to be agile, innovative and creative; today’s announcement puts meat on the bones of that rhetoric.
“Australia is facing a growth problem, and the best way to spark growth is to create a bedrock for innovation and support businesses to disrupt themselves and take risks. Today’s statement is a great framework to achieve this.
“Australia’s start-up sector has been waiting for a spark like this to ignite its potential. PwC research shows the Australian tech startup sector could contribute $109 billion and 540,000 jobs to the economy by 2033.
“Importantly, by retaining the existing arrangements around research and development tax incentives, the Statement recognises that innovation doesn’t solely occur in startups. While Facebook was developed in a college dorm, the iPod was developed by a multinational tech company – the Statement therefore recognises the need to incentivise investment in innovation right across the entire business community; big and small, start-up and mature.
“In a world where investors are skeptical and capital is hard to come by, this is a strong example of how the tax system can be used to encourage investment and support growth and employment. The 10 year capital gains tax exemption and 20 per cent tax offset for investors in early stage ventures will direct investment into areas of our economy with the greatest potential for growth.
“The $48 million proposal to support ‘STEM’ skills and education is crucial at a time when PwC research shows 44 per cent of current Australian jobs will be at risk from digital disruption over the next 20 years.
“One of the ways we can close the gender pay gap is to encourage more women into higher paying professions, so the $13 million investment in getting more women interested in STEM related subjects and careers will be crucial in preparing them for the high-paying careers of tomorrow.”
Yasser El-Ansary, chief executive of AVCAL
“For too many years, we have had policy review after review without much being seen in the way of truly transformative policy reforms focused on long-term outcomes.
“Australia’s economy today is about the same size as Canada’s and Korea’s. Yet, we spend less than a third of what they do into venture capital investment.
“These numbers are not about a lack of investment opportunity in Australia. It is about the missed opportunities over the years. This has resulted in many great ideas, people and companies moving to other jurisdictions which could offer them funding and support where Australia could not.
“We welcome the Government’s announcement of significant reforms to the Early Stage Venture Capital Limited Partnership (ESVCLP) framework to unlock greater early stage investment. This, together with other measures such as the new $200m CSIRO Innovation Fund and $250m Biomedical Translation Fund, will go a long way towards plugging the current capital and commercialisation gap between our research investment and entrepreneurial potential, with the task of bringing these ideas and products to the market.
“However, better policies to improve STEM education, research and startup investment need to be supplemented by better policies to improve the availability of later stage expansion capital as well. The Innovation Statement has not addressed this in any substantial way, despite the clear need to bridge this later stage “Valley of Death” if we want to see the real economic benefits of supporting grassroots innovation. It should be well understood that it is later stage capital that directly supports the beginning significant expansion in new jobs, opportunities and sustained growth in a startup.”
Suzanne Campbell, CEO of AIIA
“Australia’s future jobs and growth depends on innovation being at the heart of the economy. The National Innovation and Science Agenda is an important, tangible step in changing the national mindset on the role of innovation and entrepreneurship in Australia’s economic success.
“The federal government has listened to industry and its feedback on how we take our home grown research, ideas and expertise and turn them into the businesses and jobs of the future.
“The Agenda delivers world class policies for supporting entrepreneurialism – key to Australia developing a thriving, productive and internationally competitive startup sector.
“It’s encouraging to see the federal government deliver on areas of policy where the AIIA has been agitating for change. The $99 million investment in STEM programs is crucial to providing the workers needed for the jobs of tomorrow.
“With Australia last in the OECD in commercialising research, the $75 million investment in Data61 and $15 million into the CSIRO commercialisation of innovation fund are sorely needed initiatives which will improve our standing and provide certainty for students contemplating a career in STEM.
“Proposed changes to Government procurement arrangements, with a focus on surfacing more innovative solutions to policy and implementation issues is well over due. Combined with the establishment of a Digital Marketplace for ICT procurement the Government has signalled its preparedness to take a more strategic approach to procurement – using its purchasing power to drive policy outcomes.
“The $30m investment in establishment of a new Cyber Security Growth Centre, recognises both the need for Australia to build its own cyber resilience and importantly, the significant business opportunity for Australia’s own cyber security industry.
“A whole of government, systems approach with leadership from the new Innovation and Science Committee of Cabinet and Innovation and Science Australia ensure the right governance framework is in place to make the Agenda a success. The establishment of the new Cabinet Committee which will sit beside others which oversee the national interest, such as the National Security committee, demonstrates the seriousness and priority this Agenda has to the Prime Minister.
“It’s now up to industry to find the opportunities in the Agenda. Businesses of all sizes have their best ever opportunity to embrace innovation and set themselves up to be competitive in an increasingly digital global economy.”
Catherine Livingstone, president of the Business Council of Australia
“The National Innovation and Science Agenda highlights the critical importance of innovation in growing the Australian economy, creating jobs, lifting the competitiveness of large and small Australian businesses, and the wages and living standards of Australians.
“The Agenda represents a significant step towards recognising that there is a broader innovation system, that this system is entirely integrated with the economy rather than being separate from it, and that a whole of government approach is therefore needed to mobilise the system’s interdependent elements.
“In this context, it is vital that the initiatives outlined in the Agenda are complemented by improvements to economy-wide policy settings, including tax reform, the workplace relations system and the competition and de regulation agenda, which are fundamental to boosting Australia’s investment, innovation and productivity performance.
“While all policy settings should be regularly reviewed, we need to end the policy inconsistency and unnecessary rebadging which has seen Australia’s innovation performance fall well short on almost every international indicator.
“Policy continuity is a feature of those economies with a strong innovation performance. Today’s announcements provide a foundation for current and future governments to nurture an enduring, high-functioning innovation system in Australia.
“This requires bipartisan support for specific policy settings. Given the strong package announced by the ALP last week, we now need the major parties to agree on significant policy detail to lock in the fundamentals.
“Today’s National Innovation and Science Agenda conveys a positive and realistic ambition for what Australia can be. This is an opportunity to imagine our own future and work to realise our enormous potential as a nation.
“The Agenda represents more than a sum of its parts and must be supported and implemented as a package.”
Helen Fisher, lead tax partner for Life Sciences and Health Care at Deloitte
“The Government should be congratulated for what it has achieved over the past three months in this area. The National Innovation and Science Agenda released today is a welcome first step to encouraging greater innovation, including commercialisation, in Australia.
“The investor incentive, which is based on the UK’s successful Seed Enterprise Investment Scheme for small start-ups, is less generous, but has the potential to create an immediate flow of capital to the industries that drive innovation. It will help kick start this vital part of the Australian economy, although most measures will only be introduced from 2017.
“Separately, although not part of the Agenda, we also understand an Australian patent box is still being considered and the Board of Taxation is currently reviewing proposals around this particular incentive. The Australian Innovation and Manufacturing (AIM) Incentive, developed by industry bodies, such as AusBiotech, Medical Technologies Association of Australia, Export Council of Australia, and Cook Medical, has been put forward as a model, and we understand it is compliant with the OECD’s recently released BEPS reports.
“There are also a number of other measures currently stimulating innovation culture across a variety of government portfolios and included in the Agenda, including a stronger focus on STEM education, immigration rules and relaxation of bankruptcy rules without promoting undue recklessness.
“The Agenda seeks to provide a rounded approach that includes most players in the innovation ecosystem, including universities, start-ups, investors, and skills and talent. Having a complete suite of measures will provide a strong platform from which Australian companies can compete in the global market.”