The Tasmanian government has lifted its financial cap on strategic co-investments to $35 million in a bid to boost economic growth and jobs amid national and international economic headwinds.
Legislation to raise the $10 million limit set in 1999 passed on Thursday, fulfilling an election promise aimed at giving the Tasmanian Development Board more freedom to invest in local projects.
Sectors identified by the government for “pro-active” support and co-investment earlier this year include advanced manufacturing, renewable energy, and technology and research.
Tasmanian Premier Jeremy Rockliff said the reforms would see the board “play an increasingly important role in Tasmania’s economic development” amid national and international economic headwinds.
“These amendments will give TDR the flexibility it needs to promote further investment in Tasmania, supporting our economy and creating jobs, as well as building on Tasmania’s reputation as a business-friendly environment,” he said.
As the government’s industry and business development entity, Tasmania Development and Resources provides loans, grants and guarantees to support business stability, employment and economic development.
The Tasmanian Liberal Party went to the March election with a plan to update the Tasmanian Development Act, arguing the cap had “hamstrung opportunities” and not kept pace with inflation and the modern investment landscape.
“This is constraining the ability to take equity investment in projects and not achieving the best value for money outcomes for the state,” the policy said of the existing financial limits.
Tasmania was one of the weakest performers on annual economic activity, according to the latest CommSec State of the States report, ranking in front of only Western Australia. Population growth is also the weakest in eight years.
According to the bill introduced last month and passed without amendments, four caps will be lifted to “enhance TDR’s ability to support economic development and improve its operational efficiency”.
The financial cap on acquiring an interest in a business undertaking will climb from $10 million to $35 million, while limits on secured loans will grow fivefold to $15 million.
Unsecured loans and discharging liabilities will also double to $500,000 and $50,000, respectively, while mechanisms to “plan, deliver and coordinate large-scale projects”, much like the Queensland’s Coordinator-General does, will be introduced.
Do you know more? Contact James Riley via Email.