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

FOR IMMEDIATE RELEASE

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

 

Superu Report: Land Regulation Drives Auckland House Prices

Land use regulation is responsible for up to 56 per cent of the cost of an average house in Auckland according to a new research report quantifying the impact of land use regulations, Finance Minister Steven Joyce says. More>>

ALSO:

Fletcher Whittled: Fletcher Dumps Adamson In Face Of Dissatisfaction

Fletcher Building has taken the unusual step of dumping its chief executive, Mark Adamson, as the company slashed its full-year earnings guidance and flagged an impairment against Australian assets. More>>

ALSO:

No More Dog Docking: New Animal Welfare Regulations Progressed

“These 46 regulations include stock transport, farm husbandry, companion and working animals, pigs, layer hens and the way animals are accounted for in research, testing and teaching.” More>>

ALSO:

Employment: Most Kiwifruit Contractors Breaking Law

A Labour Inspectorate operation targeting the kiwifruit industry in Bay of Plenty has found the majority of labour hire contractors are breaching their obligations as employers. More>>

ALSO:

'Work Experience': Welfare Group Opposes The Warehouse Workfare

“This programme is about exploiting unemployed youth, not teaching them skills. The government are subsidising the Warehouse in the name of reducing benefit dependency,” says Vanessa Cole, spokesperson for Auckland Action Against Poverty. More>>

ALSO:

Internet Taxes: Labour To Target $600M In Unpaid Taxes From Multinationals

The Labour Party would target multinationals operating in New Zealand to ensure they don't avoid paying tax if it wins power and is targeting $600 million over three years through a "diverted profits tax," says leader Andrew Little. More>>

ALSO: