The Technology Council of Australia has welcomed the National Reconstruction Fund by government as a provider of ‘patient capital’ for long-term strategic investments, but says it should be designed as a complement to private sources of funding.
Tech Council chief executive Kate Pounder used an address to the National Press Club to demand further incentives for private sector investments in priority sectors – a ‘national investment allowance’ – to accelerate investment in critical technologies like quantum, artificial intelligence, AI, cyber and biotech.
Ms Pounder also called for urgent reforms to foreign investment review processes in order to smooth the way for offshore capital to boost Australia’s domestic capability.
“We need to invest urgently because we’re in the middle of a global tech arms race,” Ms Pounder said.
“It is now both a security and economic necessity to have a strong local tech ecosystem producing, attracting and training globally competitive products and people.
“Stretched Treasury coffers alone can’t provide the capital that local and global markets can.”
The Tech Council wants government to look at the foreign investment review process as a matter of urgency, saying it is ranked by the OECD as the 34th least efficient out of 38 countries
In her first address to the National Press Club, Ms Pounder detailed the Tech Council’s call to establish an “investment allowance” – a tax incentive – to drive money and effort into areas declared as economic priorities by government.
The tax incentive would allow businesses to immediately deduct a share of investments, covering both hardware and more significantly, software assets.
“It would give innovative companies across the economy, who are focused on solving big challenges, a stronger incentive to invest,” Ms Pounder said.
“That includes in equipment to make their businesses more efficient, but also in developing software to make their products work better.”
“It would encourage existing businesses to bring forward investment over the next 12 to 18 months, when global economic conditions are expected to be tough, boosting our national productivity into the future.”
The Tech Council has thrown its full weight behind the proposed $15 billion National Reconstruction Fund, saying there is a crucial role of government in the provision of ‘patient capital’.
“We believe the Fund can complement private sources of funding for long-term strategic, emerging technologies and industries,” Ms Pounder said.
“The $1 billion critical technologies target in particular has an important role to play in funding long-term, strategic opportunities in the national interest.”
The design and implementation of the fund would be key to its success. But ultimately this would also require an increase in private sector investment through additional incentives.
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The subtext from the TCA here is to lower tax for multinations and reduce regulation to increase profit. TCA is predominately funded and controlled by MNC. The Australia flag is used to help us swallow their medicine.