StartupAus CEO says axing of $500 million fund is bad news for 'backwards' innovation agenda

Cabinet Secretary Arthur Sinodinos is sworn in by Governor-General Sir Peter Cosgrove during the swearing-in ceremony of the new Turnbull Government at Government House on September 21, 2015. Photo: Stefan Postles – Pool/ Getty Images.

The chief executive of industry body StartupAus has said that the “next wave” of innovation agenda in Australia seems to be “going backwards”.

Alex McCauley — speaking to Business Insider in response to the AFR’s report this week that former minister Greg Hunt’s $500 million innovation fund is now under review — said that little progress has been made on the next phase of the government’s national innovation and science agenda since it was announced 18 months ago.

“We need clear leadership and coordinated action to drive this agenda at the pace the sector needs,” he said. “[The demise of the innovation fund] is bad news for the startup sector. This innovation fund was to be a signature measure in the next wave of innovation policies.”

Former innovation minister Hunt announced the innovation fund in the middle of last year then elaborated in December that it would be modelled after the $500 million biomedical translation fund. However, Prime minister Malcolm Turnbull replaced Hunt with Arthur Sinodinos last month before the promise could be fulfilled.

Now the board of Innovation Science Australia is reportedly reviewing whether a government-backed innovation fund is needed, considering commercial funds totalling almost $2 billion have arisen in Australia in the past couple of years.

“There has been a rearguard action,” a source told the AFR. “We are happy to look at proposals but we need to know there is a problem.”

Even if it’s determined that there are funding gaps required to be filled by the state, the AFR said ISA would not necessarily “throw money at the problem”.

The office of the new innovation minister has not responded to Business Australia’s request for comment.

Innovation Science Australia, when contacted by Business Insider, referred to the recently released Performance Review of the Australian Innovation, Science and Research System 2016 report.

“Throughout 2017 ISA will be developing a strategic plan for the Australian innovation, science and research system that will take a holistic approach to considering how Australia can best be positioned as a top-tier innovation nation by 2030,” an ISA spokesperson told Business Insider.

Meanwhile, McCauley has reminded the powerbrokers that any further delays are unacceptable.

“We already know what this ecosystem needs and we can’t afford to wait another year while we go back to the drawing board,” he said, adding that Sinodinos and ISA should take note of the 14 recommendations published last year in StartupAus’s Crossroads report.

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