Between the $1.2 billion digital economy plan, encouragement of foreign investment and changes to employee share schemes, tonight’s budget is shaping up to include a swathe of policies that will affect the Aussie startup ecosystem.
But there are still a few things that aren’t crystal clear just yet. So, here are four areas leaders in the startup sector are keeping an eye on.
Addressing the skills shortage
There has been a lot of talk around the tech skills shortage, and the difficultly startups face in securing the talent they need to grow their businesses.
The challenges here are two-fold. There is not enough homegrown talent coming through the pipeline to fill the need in Australia, and COVID-19 restrictions are preventing skilled migrants from entering.
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Caroline Henshaw, head of people and culture and Mantel Group, said she would like to see policies that encourage companies to create their own talent, with incentives to hire women, and members of other minority groups, for example.
The JobMaker package unveiled in last year’s budget, which failed to take off in any significant way, was a start, Henshaw says.
“But they are difficult to access, and there was little support for retraining unless that person has been on JobSeeker.
“More financial incentives and support for training with fewer restrictions is what we need.”
In the immediate term, however, there would also be benefits in encouraging tech talent from overseas to enter Australia.
“It’s those highly-skilled workers that drive the economy of the future in our region,” Nick Northcott, chief strategy officer at Australian legal tech startup Immediation, argued.
“In order to tap into the international skills to support the scaleup of Australian businesses, we need a sustainable COVID-19 quarantine policy.”
R&D tax incentive
While last year’s federal budget scrapped a suite of controversial reforms to the research and development tax incentive (RDTI), this year many will be looking for clarity around how the scheme applies to software startups.
Earlier this month, the Senate Select Committee on Financial Technology and Regulatory Technology, chaired by Senator Andrew Bragg, tabled its second interim report, recommending that “consideration” should be given to a standalone RDTI scheme for software startups.
“We would hope that this budget expedites some of the recommendations made in last months’ Senate Inquiry on Australia as a Financial and Technology Centre,” Rebecca Schot-Guppy, chief executive of FinTech Aus, told SmartCompany.
Investment in AI
Last month, the Australian Information Industry Association (AIIA) laid out recommendations for a $250 million government investment in AI, to fund a national strategy.
For chief executive Ron Gauci, the $124.1 million pledged to AI in the government’s digital economy plan only goes halfway.
Investment in R&D here is important, he said in a statement. But more needs to be done to encourage investment in commercialising AI tech.
“Without it we will continue to fall behind the rest of the world,” he said.
A changing attitude towards tech
This is a government that has not historically been all-too-friendly towards the tech sector, and the startups operating within it.
The grand announcement of the digital economy strategy offered a glimmer of hope; a suggestions that this industry is one that has a big role to play in the economy recovery, and that is being recognised as such.
Indeed, Schot-Guppy said last week the announcement “signifies a shift in thinking in how technology buoys our economy”.
Tech isn’t a sector unto itself, it’s one that supports almost every other industry in one way or another.
Tech plays a role in creative solutions to complex issues including healthcare, justice and social services, Northcott notes, offering outcomes that go beyond what he calls band-aid solutions.
“We need to focus on innovative social financing, social procurement and social impact investing that are outcomes based and measured, if we’re serious about solving these complex issues,” he said.
Gauci also noted that Australia’s “ongoing prosperity” will depend on its ability on its ability to innovate, and on the leadership and policies that will make that happen.
“We must support our innovators and ensure Australia can retain ownership of our brilliant creations and ensure we do not fall behind our international peers,” he said.