Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Short-term pain, now we need to see long-term gain

Media release

13 May 2014

We’ve seen the short-term pain, now we need to see the long-term gain, says AVCAL


The release today of the Government’s 2014-15 federal budget has confirmed plans to implement major short-term savings through the abolition of key innovation industry programmes, without there being a complete picture of how businesses will be encouraged to transition into a more innovative and internationally competitive economy in the future, says the Australian Private Equity & Venture Capital Association Limited (AVCAL).

“Everyone was expecting to see plenty of short-term pain for businesses in this budget – and that’s exactly what we got,” said AVCAL’s Chief Executive, Yasser El-Ansary.

“But what we were also expecting to see tonight was a plan which set out the longer-term vision for what the Australian economy will look like in the next five or ten years – the short-term strategy of deep cuts to expenditure only makes sense when you can line it up against a picture of where we are trying to get to,” he added.

Support for innovation investment

The Government has confirmed in this budget plans to abolish a number of key programmes, including the highly successful 15-year old Innovation Investment Fund, as well as cuts to the research and development tax system.

“Abolishing the Innovation Investment Fund represents a major set-back to Australia’s capacity to foster a stronger venture capital industry that can drive businesses in the new corridors of economic growth for our future,” according to Mr El-Ansary.

“The establishment of a new Medical Research Future Fund could support greater investment into biotechnology into the future, but it has to be designed in a way that encompasses a focus on commercialisation as well as pure research,” he added.

“The new Entrepreneurs’ Infrastructure Programme will have to be framed around backing Australian businesses with world-class ideas that can be supported by private sector investment from the venture capital industry,” said Mr El-Ansary.

Lifting our international competitiveness

“Business was looking at this budget as an opportunity to kick-start a renewed focus on lifting Australia’s competitive position in the international race for capital and skills, and while a cut to the corporate income tax rate is a step in the right direction, there is a lot more that needs to be done,” said Mr El-Ansary.

In the World Economic Forum’s Global Competitiveness Index, Australia currently ranks number 15 in the group of 34 OECD countries [based on the World Economic Forum’s Global Competitiveness Index for 2012-13]. AVCAL has advocated for some time for changes to be made to tax settings that would help to make Australia a more attractive destination for domestic and offshore investors.

AVCAL will turn its attention over coming weeks towards pressing the Government to map out a plan for how it will encourage greater investment into business and innovation in Australia, through the National Industry Investment and Competiveness Agenda, which is due to be released in the coming months.

© Scoop Media

Business Headlines | Sci-Tech Headlines


DIY: Kiwi Ingenuity And Masking Tape Saves Chick

Kiwi ingenuity and masking tape has saved a Kiwi chick after its egg was badly damaged endangering the chick's life. The egg was delivered to Kiwi Encounter at Rainbow Springs in Rotorua 14 days ago by a DOC worker with a large hole in its shell and against all odds has just successfully hatched. More>>


Trade: Key To Lead Mission To India; ASEAN FTA Review Announced

Prime Minister John Key will lead a trade delegation to India next week, saying the pursuit of a free trade agreement with the protectionist giant is "the primary reason we're going" but playing down the likelihood of early progress. More>>



MYOB: Digital Signatures Go Live

From today, Inland Revenue will begin accepting “digital signatures”, saving businesses and their accountants a huge amount of administration time and further reducing the need for pen and paper in the workplace. More>>

Oil Searches: Norway's Statoil Quits Reinga Basin

Statoil, the Norwegian state-owned oil company, has given up oil and gas exploration in Northland's Reinga Basin, saying the probably of a find was 'too low'. More>>


Modern Living: Auckland Development Blowouts Reminiscent Of Run Up To GFC

The collapse of property developments in Auckland is "almost groundhog day" to the run-up of the global financial crisis in 2007/2008 as banks refuse to fund projects due to blowouts in construction and labour costs, says John Kensington, the author of KPMG's Financial Institutions Performance Survey. More>>


Health: New Zealand's First ‘No Sugary Drinks’ Logo Unveiled

New Zealand’s first “no sugary drinks logo” has been unveiled at an event in Wellington... It will empower communities around New Zealand to lift their health and wellbeing and send a clear message about the damage caused by too much sugar in our diets. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news