The 2014 budget delivered the news that many businesses were dreading with the abolition of the Innovation Investment Fund and Commercialisation Australia.
Speaking on budget night, Treasurer Joe Hockey said the government would be abolishing a range of industry assistance programs and would “refocus our effort on innovation and self-reliance”.
“Businesses should stand or fall on their ability to produce goods and services that people actually want,” Hockey said.
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The government will instead establish a single business service to deliver an Entrepreneurs’ Infrastructure Program, which will supply $484.2 million over five years.
The government claims it will achieve a saving of $845.6 million over five years by ceasing both CA and IIF as well other programs including the Australian Industry Participation, Enterprise Solutions, Industry Innovations Councils, Enterprise Connect and Industry Innovation Precincts.
According to information released on budget night the new program will focus on supporting the commercialisation of good ideas, job creation and lifting the capabilities of small businesses, the provision of market and industry information, and the facilitation of access to business management advice and skills from experienced private sector providers and researchers.
In a statement, Minister for Industry Ian Macfarlane said industry policy would no longer be an “overlapping plethora of small grants and entitlements.”
“The new program will bring research and business together to develop and commercialise home-grown ideas and equip small to medium enterprises with the management and business skills to lead change and expansion,” Macfarlane said in a statement.
Shoes of Prey founder Michael Fox responded to rumblings around the abolishment of Commercialisation Australia, prior to the budget announcement, when the grants were frozen until the budget was released.
“That’s already been incredibly frustrating for us. We put in an application for a grant in November,” he told SmartCompany.
Fox said applying for funding from Commercialisation Australia had been a “huge amount of work”.
“It took two or three weeks full-time for me as the chief executive and that much time again from other people in the business to prepare the application,” he said.
At the time he said it would be very disappointing if Commercialisation Australia was cut.
Since its inception, Commercialisation Australia has invested over $213 million in 503 companies (as of February 2014) and was responsible for helping a number of Australian success stories like Seek.com.
This story was first published on StartUpSmart.