Australia’s Industry Growth Centres have been allocated an additional $19 million to transition to self-sustaining operation next year when the federal government pulls its support for the long-running initiative. The centres will also be allowed to operate for an additional year to allocate any of the unspent grants they administer.
Thursday’s MYEFO budget update included $18.8 million for the Industry Growth Centre (IGC) initiative for the current financial year. The Industry department confirmed the allocation is for “seed funding for key projects of value” identified in the centres’ individual transition plans.
The money comes from existing unallocated IGC initiative funding, and some of the growth centre heads were briefed Friday by the Industry department.
There are doubts about the viability of any of the centres achieving self-sustainment after a secretive review of the IGCs last year said the prospect was “unlikely”, according to leaked parts of the report published by independent publication AuManufacturing. The leak also suggests the IGCs have been assessed to have performed well, but have struggled to make a transformational, sector-wide impact because of under resourcing relative to similar initiatives overseas.
The Opposition, which has had its attempts to have the report released blocked, has raised concerns that the government is trying to “kill off” the centres to regain control of the grants they administer, for political purposes.
The Industry Growth Centres (IGC) were established in 2015 as independent not-for-profit industry organisations to drive cultural change and boost collaboration, commercialisation, skills and regulatory reform in six key sectors. The sectors are advanced manufacturing, cybersecurity, food and agribusiness, MedTech and pharmaceuticals, mining equipment, technology and services, and oil, gas and energy reserves.
Each IGC has relied on government funding streams for operation and the grants they disperse, and regularly attract industry contributions to their programs. IGCs have been told to seek their own funding from July next year in a transition to self-sustaining models.
An external review of the centres’ performance was completed last year but the Coalition has blocked attempts to release it, including refusing to comply with a Senate order in August and declining to allow it to be shared with individual IGCs, which had hoped to use it in their transition plans.
A spokesperson for the Department of Industry, Science, Energy and Resources said the latest funds revealed in MYEFO will be allocated for the current financial year for “activities to increase skills, collaboration and commercialisation and to improve international opportunities and market access”.
“This announcement uses uncommitted and unallocated funding from the Industry Growth Centre Initiative’s budget to support the IGCs make a smooth transition to new self-sustaining operating models going forward,” the spokesperson told InnovationAus.
“Disbursement of these funds will align with the IGCs’ existing transition plans and provide seed funding for key projects of value in those plans.
“The department is focussed on supporting the current IGCs through their transition, working with each IGC so they are able to bed down their achievements, ensure collaborative networks are shored-up and that they retain and build on their existing value going forward.”
The transition plans vary based on the six individual centres, but some are are understood to be forecasting several more years of required government support.
The Mining Equipment, Technology, and Services growth centre – METS Ignited – has proposed finalising its existing programs and transitioning to a new Australian Technology Centre. The new centre would generate revenue by releasing currently stranded technologies in research organisations and mining companies, and would be self-sufficient within three years, according to the METS Ignited.
Cybersecurity focused AustCyber, has already started a merger process with tech incubator Stone and Chalk, but the completion does not necessarily mean self-sustainment and the centre is also canvassing state government partnership opportunities.
In September the IGCs were advised they would have an extra year to spend any unspent grant funds remaining at 30 June 2022, as a way to smooth their transition and protect the government’s investment. InnovationAus understands some of the centres have already committed their grant balances, with some IGCs’ programs regularly oversubscribed, while others will need the extra time to administer the grants.
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