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Election 2022: “Huge point of difference”

“The government has been, even now, pretty much absent from action on any key issue in the innovation space.”

When announcing its intention to work with the tech industry to alleviate a skills shortage – an issue that many in the sector have identified as their top campaign issue – the government listed other areas it has declared to have adopted in its digital economy strategy.

No chance of winning the tech vote

These included reforms to employee share ownership plans to help start-ups attract and retain talent; a $111 million national quantum computing strategy, a $124 million artificial intelligence action plan, and tax incentives to encourage small and medium-sized businesses to adopt digital tools.

In addition, he cited the expansion of consumer data rights, increased investment in cybersecurity, and an upgrade to the national broadband network as examples of his technology policy credentials.

Mr Petre said most of these government announcements on technology issues lacked specific actions, resource allocation or timetables, and that there was now “no chance of winning the community’s vote”. technology”, for there had been few worthwhile innovations from the Coalition since the early stages of Malcolm Turnbull’s leadership.

Rick Baker, co-founder of Blackbird Ventures, said Labour’s technology investment commitment would encourage more private capital to back ambitious Australian quantum computing ventures. Edwina Pickles

“Since then, simple issues like the influx of skilled immigrants, changes to ESOP (employee stock ownership), and the strengthening of R&The D tax incentives have taken years to gain traction and are still unresolved,” he said.

“When he set up funds, they were ridiculously small sums of money; $124m for AI will do the trick, while the UK and EU have both allocated €1bn. At least the Labor Party has allocated an appropriate amount of money to try to get the dial moving.

Blackbird Ventures co-founder and partner Rick Baker also threw his support behind Labour’s billion-dollar initiative, saying it would encourage further investor support in areas such as quantum computing, where breakthroughs can take many years and hundreds of millions of dollars to market.

“Quantum will be a huge national construction industry. Australia have great talent and ability, but they will need a lot of long-term support. Knowing that the government intends to support these types of businesses gives private money the confidence to come in, and especially to come in early,” he said.

“If a [quantum] company is going around, you know it will take hundreds of millions of dollars to get it off the ground. There is still a long way to go.

“[Government backing] sets the right mindset and builds confidence for founders, investors, and customers, who at some point have to take risks by paying for these products. They are more willing to do this if they know there is a source of capital along the way.

Although he is a “big fan” of private markets making investment decisions, in high-tech industries that need long-term guidance, Mr Baker said it was helpful for the government “intervene”.

As well as tipping cash, Mr Baker said one of the most important things the government can do to help boost the local tech industry is become a customer.

“It’s better than fairness,” he said.

“It’s kind of like in the United States – SpaceX got so many contracts from the US government, and that really got it off the ground. We’re just starting to see some of that come to fruition in Australia, but it’s on a much smaller scale.

“I totally understand that governments have processes that need to be rigorous, the last thing you want to see is a government pouring money on unworthy contracts, but that’s really tough for start-ups. ups, and we’re all hoping to find a middle ground where there’s enough rigor, but still a willingness to take risks with younger companies and newer products.

“You also have to understand that sometimes there will be failures and no one will be criticized for them.”

The view of a founder

As one of the country’s most successful tech founders in recent years, Young Rich Lister Sam Kroonenburg, who sold his company A Cloud Guru to Pluralsight last year, said he supports any government policy that supports “pure science” and encouraged increased financial support for research and development.

Fintech Australia CEO Andrew Porter said it seemed ‘technology’ was still a dirty word in the Coalition’s party hall, after the perceived failure of Malcolm Turnbull’s innovation agenda.

He said he would also like to see a change in policy to address one of the biggest challenges he had faced; management of office space requirements.

“I’ve found real estate to be the biggest challenge in Australia. The system forces you to sign leases for five or seven years, but when you’re a fast-growing business you double every year,” said Ms. Kroonenburg.

“We rented a space that could hold 40 to 50 people, but after a year we had 120 people, then 250. You have to invest in these huge facilities and a year later, you need someone to take over the lease.

“We need better rules to share leases or to be able to transfer them more easily to other companies. We need better infrastructure around this because it takes so much time and attention. »

Other industry insiders and entrepreneurs interviewed by The Australian Financial Review about the election campaign and their hopes leading up to next Saturday’s vote, expressed disappointment that the topic of technology as a driver of jobs and growth figured so little in the debate.

‘Tech’ a dirty word

Andrew Porter, chief executive of industry body Fintech Australia, said it was worth acknowledging that the government had worked closely with the fintech sector over the past few years on crypto legislation and the development of consumer data rights, but lamented its aversion to publicly discussing innovation policy. .

“It speaks to the assertion that technology is still a dirty word in the Coalition party hall, and the legacy of the failed innovation agenda still stings the party,” said Ms. . To carry.

“We are nearing the end of the election campaign, and it is such a shame that apart from this key Labor policy, released after the last leaders’ debate, we finally have a vision of what our tech sector can expect. of the results of this survey.

“In terms of the policy proposed by the Labor Party, this is something we have seen overseas and have advocated in the past for the fintech sector… It is crucial that investment from this plan are comparable to those of a VC, as if it is too difficult to access, we simply will not see any interest from the start-up and fintech community.

Blocking immigration

Matt Tyrrell, who moved to Sydney from the UK last year to set up the Asia-Pacific operations of fast-growing fintech Codat, said that even with tech leaders advocating changes to immigration rules to alleviate the national skills shortage, the topic was ignored by both sides of the campaign.

At the start of the campaign, the Labor Party announced a policy based on education and training to create and fill an additional 340,000 technology-related jobs by the end of the decade, but avoided the subject of the increased immigration to alleviate immediate shortages.

The Coalition’s skills roundtable, meanwhile, is also part of a plan it says will help attract more people into tech jobs, and it announced last week that it would spend $5 million to develop a technology skills passport so Australian workers can be matched with organizations seeking their talent.

“The tight labor market in Australia is the main factor holding back the sector. If you’re setting up a software company in Australia right now, you have next to no chance of building a software development team from scratch,” Tyrrell said.

“Not only are software developers scarce, they’re also incredibly expensive, and unless you’re a multi-billion dollar company like Google or Atlassian, start-ups simply can’t compete at this level.

“In my view, the number one thing the government can do to help the sector at this time is to do whatever it takes to make it incredibly quick and easy for Australian tech companies to hire experienced employees and talent from the UK, Europe and the North. America, similar to what they did for critical skills shortages in healthcare.

Melissa Price, Minister for Industry, Science and Technology, has been contacted to comment on the claim that the Coalition neglected technology and innovation policy, her take on the announcement funding from Labour, and whether the Coalition would make a similar funding commitment.

The financial review received a response from Coalition campaign headquarters, in which a government spokesman said the Morrison government had released a detailed plan to make Australia a top ten economy of data and digital by 2030.

They sought to argue that record Australian venture capital investment in 2021 was the result of policies such as employee share ownership reforms, venture capital-friendly tax incentives and consumer data rights.

“Work has come late to the technology table – the Coalition has already released a Critical Technologies Blueprint and Action Plan and a $124 million Artificial Intelligence Action Plan the last year,” the spokesperson said.

“We also announced the development of a $111 million National Quantum Strategy, aimed at positioning our country to leverage the potential of quantum technologies to add $4 billion and 16,000 new jobs to our national economy by here 2040.”

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