Two years after Malcolm Turnbull unveiled the much-heralded $1.1 billion innovation statement, advocacy groups and the Opposition are calling on the government to reaffirm its commitment to the startup and tech sectors and introduce the next wave of policy reform.
The National Innovation and Science Agenda (NISA) was unveiled by Prime Minister Turnbull on 7 December 2015, just months after he had taken on the top job. It ushered the “Ideas Boom”, and put innovation front and centre in the upcoming election campaign.
The NISA was made up of 24 initiatives costing $1.1 billion over four years, including tax breaks to encourage investment in startups, a CSIRO innovation fund, support for incubators, the creation of the Australian Cyber Security Growth Network and funding for STEM education.
But two years and four ministers later, the focus on startups and innovation has declined, and industry bodies are now calling on the federal government to deliver on its promise of a next wave of reforms in the area.
In a statement to mark the two year anniversary, acting Innovation Minister Michaelia Cash and Assistant Innovation Minister Craig Laundy said the NISA “set a vision for Australia as a world leader in innovation” and is “helping Australians get their ideas to market and to create the jobs and growth we need”.
“NISA is the spark that is igniting Australian ideas and entrepreneurship, business growth, renewal and transition. It’s helping to drive and direct our changing economy, and it’s providing the foundation we need to generate more growth, secure more jobs, higher incomes and a better standard of living for a prosperous Australia,” Senator Cash said.
“The NISA is helping our young people get the skills they need for jobs today and tomorrow. It’s boosting investment in Australian businesses, helping our businesses and world-class researchers to collaborate and innovate,” Mr Laundy said.
The government pointed to a number of areas where it said the NISA has been effective, including the growth in venture capital in Australia, funding for incubator programs, changes to the employee share scheme and the launch of Main Sequence Ventures, the CSIRO’s $200 million fund.
At the time, the NISA was a huge moment for the Australian startup and tech sectors, StartupAUS chief executive Alex McCauley said.
“The NISA was a big paradigm shift for Australian politics into an area which was forward-facing and really productive for Australia’s future prosperity,” Mr McCauley told InnovationAus.com.
“It really set a cultural landmark in terms of building an economy that was taking advantage of technology and was going to be resilient to and a part of digital change. If we can keep that momentum going, it will be to the country’s benefit,” he said.
But speaking in Parliament on Thursday, the shadow minister for the digital economy and long-time startup supporter Ed Husic criticised government for neglecting the tech and startup sector since the NISA was unveiled.
“It’s been two years since the government released the NISA. We were told this would herald the first of many, but other than this being NISA 1.0, it looks like it’s been NISA one point only,” Mr Husic said.
“People are genuinely concerned about where these things are going. There’s a lot of work to be done and we cannot allow a lack of focus.”
Mr Husic said government must urgently address the lack of data surrounding its angel investor tax incentives, pass equity crowdfunding legislation extensions to private companies, and consult with the tech sector over the “damaging” changes made to the 457 visa scheme.
Mr McCauley said that NISA was a positive and productive step two years ago, but further action and commitment is needed from the government now to ensure the sector continues to grow and develop.
“The NISA was widely celebrated by the sector when it was first announced, and we’ve seen some good follow through on lots of the policies which have made a difference. But I think it’s probably time for a conversation about what happens after NISA,” Mr McCauley said.
“We’ve been looking for quite a while to build on the platform that NISA laid. The plan was always to have NISA be the first wave of a series of big policy agenda items that were going to take the country forward.”
“It’s definitely time to have that conversation, and we’re looking at 2018 being a big year of action.”
Further NISA statements and policies were promised by the government from the start, but are yet to be delivered on. In Senate estimates in March, Industry Minister Arthur Sinodinos confirmed that two more waves of policies were planned. He suggested the first one would be delivered by May this year.
“There will be a series of initiatives, whether you want to call them NISA 2 and then NISA 3. It is a bit like a ripple effect from the first NISA, so yes, there would be specific measures coming up, I am hoping, in the near future building on the foundations from NISA 1,” Senator Sinodinos said.
“I am working on proposals now. I would hope by budget time but do not hold me to that – I have got processes to go through internally,” he said.
Seven months on from the federal budget, the next wave of NISA reforms are yet to be seen.
The innovation agenda has now been overseen by four different ministers across the two years: Christopher Pyne, Greg Hunt, senator Sinodinos and now senator Cash, who has stepped in while senator Sinodinos is on extended sick leave from Parliament.
Better cohesion and a consistency in ministers is needed to drive the agenda forward, Mr McCauley said.
“I think it would help the agenda for it to have the undivided attention of something they’re really passionate about delivering. It’s difficult to develop that with the changes in the ministerial portfolio,” he said.
“We’re certainly hopeful that the prime minister has it in his to-do list, and he’s going to work with whoever is the minister to build some momentum and action.”
In terms of successful policies from NISA, Mr McCauley pointed to the tax breaks for investments in early-stage innovation companies, and the global landing pads that have since been established around the world.
But there have been few new policies in the space from the federal government since NISA’s announcement, except in the FinTech space, leaving the private sector and state governments to pick up the slack. But now it’s time for the federal government to step back up to the innovation plate, he said.
“Government moves slowly and there are lots of issues on the agenda. We have to get the policies in place before thinking about the next set of policies.
“We want to see ambitious and bold action from the federal government, and the next six to 12 months on will be the perfect time,” Mr McCauley said
StartupAus will be lobbying the government to include smaller fine-tunings of current policies like the angel investor incentives, along with bigger stand-alone reforms on visas and copyright rules.
The StartupAUS Crossroads 2017 report included a number of recommendations to government, including changes to help startups access talent from overseas, the introduction of copyright safe harbour for tech companies and improvements to the R&D tax incentive.
“There’s a whole bunch of stuff that is bigger and more substantive that we need to look at right now. We need to do the little stuff that doesn’t cost money and some bigger, bolder things that are going to make a big difference. We can really set ourselves out to be one of the best places in the world to build a startup,” Mr McCauley said.
Mr McCauley also acknowledged the support the federal opposition has given to the sector, and its bipartisan support of many of the NISA initiatives.
“The Opposition has been speaking a lot about this for the last two years and before that. There has been some pretty consistent messaging from the Labor side and Ed Husic in particular. NISA was largely bipartisan and we hope to continue to involve the Labor Party,” he said.