Denham Sadler
February 21, 2019

Push for budget innovation revamp

Budget 2019

Push for budget innovation revamp

Budget demands: tech sector chasing better innovation approach in 2019 budget.

The tech sector has called for a major revamp of the government’s innovation policy agenda so Australia can "reap substantial economic benefits", with hopes riding on the upcoming budget.

A number of organisations have called on the federal government to provide a renewed focus on innovation-friendly policies in the April budget, with a focus on tax incentives, public-private collaboration and skills shortages.

In its pre-budget submission to Treasury, the Australian Information Industry Association called for a "whole-of-government reform initiative".

"There must be a long-term political will to execute on the many moving and interconnected parts - competition policy, tax reform, R&D funding, private and public sector commercialisation capability, and labour market reforms. Urgent government leadership is required if Australia is to reap the substantial economic benefits provided through a vibrant, innovation-led, world-class digital R&D industry," the AIIA said.

"Government needs to take on a prominent role and refresh the innovation agenda, develop and own an ambitious national vision to focus investments and capability-building in innovation, through policies and legislation. To ensure a comprehensive and cohesive approach is taken, government must work with industry and research institutions to realise this objective."

The submission called for a budgetary focus on digital skills, innovation and government digital sourcing.

The organisation has urged the government to establish an advisory and oversight body to drive a national innovation agenda through "good governance, established objectives and clear performance indicators", including industry, research and government representatives.

A lack of tech-focused skills is presenting a "major challenge for Australians", the AIIA submission said.

"Currently there is a gap in a nationwide education campaign that targets students and their trusted career influencers that delivers information on the creative, rewarding and engaging digital career options and multiple paths to these careers. There is a significant shortfall of available digital skills and expertise in the Australian workforce," it said.

To combat this, the organisation is calling for a nationwide education campaign to provide "immediate and ongoing awareness for students, teachers, parents and career advisors about flexible learning options and multiple career paths for relevant and rewarding digital careers".

There also needs to be improvements for the Temporary Skills Visa scheme to make it easier for tech companies to attract overseas talent to fill gaps locally, it said.

"The current TSS visa assessment processes take too long. This results in competition for domestic digital talent and increases the likelihood of offshoring of digital services. TSS visa assessment processes need to be simpler, faster and more agile to maintain the Australian digital industry’s global competitiveness," the AIIA said.

An advisory body should also be established to "improve the digital sourcing capability and digital literacy of the Australian Public Service" to make it easier for local tech companies to access government contracts, the submission said.

"As one of the largest buyers of digital products and services the government is in itself a significant player in the Australian digital innovation ecosystem. However, the national opportunity to foster business entrepreneurship and innovation in government services is being hampered by complex and risk averse procurement processes," it said.

The current uncertainty surrounding the research and development tax incentive was a major focus of education bodies in their pre-budget submissions.

Research Australia urged the government to "not take action to reform the RDTI that could further dampen R&D activity", while Universities Australia pushed for a collaboration premium to be introduced to the scheme.

"This would jump-start Australian business collaboration with world-leading researchers, increasing their exposure to new ideas that could lead to transformative innovations and the greatest possible benefit to the Australian economy," Universities Australia said in its submission. 

The organisation also called for a reduction in the reliance on indirect supports for R&D, like the tax incentive.

The federal budget will be handed down by the government on 2 April.

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