It is two years and several Industry ministers after the Prime Minister unveiled with great fanfare his signature $1.1 billion National Innovation and Science Agenda, and the government is celebrating.
Well, sort of anyway. Let’s just say it is celebrating very quietly. What started as an Ideas Boom supported by an all-singing, all-dancing $28 million advertising campaign now gets a behind-closed-doors clinking of shandy glasses.
Remember, this was a policy considered so important that it warranted its own Budget-style lock-up of the press gallery in Canberra. Not anymore. Now it’s a press release acknowledgement of a milestone.
But let’s not rain on the parade just yet, because there are plenty of reasons to be cheerful. And besides, if we can’t celebrate the successes then we have given in to the truly hideous political environment of which we all despair.
The NISA arrived in the startup and innovation sectors like a breath of fresh air, so let’s breathe deep. We can get to talking about the rain later.
It is still early days, and hard to quantify some of the NISA initiatives. But there are some standouts. In no particular order, let us acknowledge:
Vastly improved access to capital in the startup sector. This is in part due to the tax breaks to encourage angel investors, and partly due to some generous incentives to encourage investment in early stage venture capital limited funds.
An estimated $280 million has been invested by angels into early stage companies in 2016-17, while the amount of money committed to ESVCL partnerships (VC finds) grew from $620 million in 2015-16 to more than $1.3 billion in 2016-17.
Those numbers are worth a party somewhere, given the dearth of early-stage dollars that had bedevilled the startup sector.
The CSIRO innovation fund and accelerator program. The jury is definitely still out on whether the $200 million Main Sequence Ventures can make a dent. But the NISA-identified the hole in the market and the follow-through has seen this fund established and make its first investments in science-based startups. This is worth a cheer (and ditto the Biomedical Translation Fund.)
The CSIRO’s accelerator programs probably would have happened under chief executive Larry Marshall anyway, regardless of whether it was wrapped in the NISA package.
But as part of the package, it has proved an incredible success – as an instrument of cultural change its impact goes beyond the CSIRO (making it easier for outside organisation to engage with CSIRO expertise.)
The Incubator Support program from the Industry department had a confused start – it looked too much like free money – but has started to find its way. The program has been used in conjunction with state governments programs to rapidly boost startup and innovation precincts.
The results will be difficult to measure, but as a contributor to the momentum of startup sector exhibiting shockingly rude health, it should be given a tick.
But here comes the rain. What’s going on with the R&D Incentive Scheme? Of the $9 billion of so that taxpayers invest in R&D support – either directly or indirectly – about two-thirds is through the R&D tax incentive.
The NISA specifically asked three eminent Australia’s to study the scheme. Innovation and Science Australia CEO Bill Ferris, Chief Scientist Alan Finkel, and Treasury secretary John Fraser handed their report and recommendations to government 19 months – and they STILL haven’t got a response.
In the meantime, the R&D tax incentive has been accessed by local companies in record numbers – and yet there is ongoing uncertainty about the scheme as the Tax Office was applied a series of seemingly conflicting definitions to its rule book.
Even given the report being handed from one minister to another as the portfolio has changes hands (Pyne to Hunt to Sinodinos to Cash/Laundy) the uncertainty is unhelpful.
The government won’t say when it will respond to the 3F review, saying through a spokesman: “The Government continues to consider how best to respond to the recommendations made by the Review panel.
“The Government will respond to the Review’s recommendations once it has finished its deliberations.
“The R&D Tax Incentive is a significant and important component of Australia’s innovation system, and the Government does not take reform of the program lightly.”
The NISA also charged the newly-created Innovation and Science Australia (ISA) to first benchmark the Australian innovation ecosystem, and then to put together a 2030 Strategy for the nation.
The ISA handed its report to government several weeks ago, but still no word on when it will be released. It is hoped it will arrive this year, but nothing guaranteed:
“The Government is considering the plan and will work with Mr Ferris and the Office of Innovation and Science Australia to coordinate a release date,” a spokesperson said. “The Plan will be a key element of the Government’s policy making moving forward, and will help inform how we strengthen Australia’s role as a leading innovation nation.”
The NISA had originally been intended as the first iteration of a rolling policy of continuous improvement. But from the outside at least, it seems the focus is lost. And the Grand Patriarch of its design and delivery – Prime Minister Malcolm Turnbull – does not provide the political cheerleading he once did.
Which is a shame, because it was the political patronage from the highest office that did more than anything to shift the needle.
So why has government gone so silent? Here’s that spokesperson:
“Nearly all the NISA initiatives have now been implemented, and we are starting to see some early positive results. We will also continue to monitor and evaluate the effectiveness of the Government’s current investments in innovations, and make appropriate adjustments, as required.
“The Government recognises that innovation remains key to Australia’s future prosperity. It is therefore taking a forward-looking, systematic and strategic approach to the future of innovation policy – to be informed by the ISA 2030 Strategic Plan, the Chief Scientist’s National Research Infrastructure Roadmap and our Digital Economy Strategy (which is currently being developed).”
The National Innovation and Science Agenda was a modest initiative. But regardless it has had a big impact.
This government should be throwing a big fat party to announce NISA 2.0. There is enough here to celebrate.
Do you know more? Contact James Riley via Email.