The budget 2018 is only a few days away, which means we will find out what the Government feels about each sector.
The budget is a great way to see the reflection of the Governments’ thoughts on each sector, I mean, it is pretty obvious when more money is being pumped into a sector shows the where the Government’s support lies.
Naturally, the startup community is keen on seeing what might be revealed on the budget this time.
So far, the major news sites have reported a tax cut for low and middle income, medicare levy, a cut into R&D tax breaks, infrastructure, seed funding to Australia Space Agency and open banking. The last two will definitely excite our community.
According to news.com.au, a generous budget can be expected because the government has loads of money.
Deloitte calculated “that in the four months to February, the rolling annual cash deficit shrank by $15.4 billion, an improvement seen only twice previously in Budget history. It forecast better-than-expected performances this financial year and the next, with big growth in profits.”
With news on big money rolling in and a tease of space venture and open banking, it is definitely interesting to see where the government is going to pump their support into.
Although the innovation project in 2016 and 2017 did not impact our startup community too much, there might still be hope for the next ten odd years. The Government released their ‘Australia 2030: Prosperity through Innovation’ plan in January. The plan included education, R&D and a focus on high-growth industries.
This is definitely something we will be looking out for in the budget since future of work seem to be quite the talk of the town recently, while it brings in much excitement, it also brings in anxiety over the uncertainty of the future. Skills and jobs might become redundant if education is not provided for us to upskill.
So to see that the Government is looking into the future of work is quite exciting.
What founders hope to see this year
We approached CEO of BenchOn, Tim Walmsley for his hopes on the budget 2018. BenchOn is a future of work startup, using a B2B talent mobility platform to solve the problem of employee underutilisation by matching a business’s idle staff to short-term contracts. They recently raised $650,000 in seed capital as it looks to scale nationally to meet market demand.
What are you hoping for in the budget 2018 regarding upskilling and workforce utilisation?
“Investment in skills, training and education but with an actionable plan to achieve the agility required to meet the ambiguity of the Future of Work. Universities should be empowered and funded to provide education services that meet the fast-paced change that the market is experiencing.”
What are you hoping for in the budget 2018 regarding startup incentives?
“I think the smart investment is in training Government staff on how to implement innovation and provide them with the policy framework to trial new technologies and business processes that the startup ecosystem is generating. Innovation is not just a budget line; it should be a way of doing business that should start with Government Agencies. The ability to trial a new product or service with a Government Agency means more to a startup than another grant.”
It will definitely be interesting to see how the government takes this initiative forward, especially when we are in the midst of major change towards the future of work. Australia 2030 might seem like the right step.
We also caught up with Luther Poler, CFO of BlueChilli, Australia’s largest startup accelerator on his hopes for this Budget. And he gave us a pretty detailed statement of what he hopes to see this time round.
- The government champions company tax cut plan, despite much of the current sentiment around large ASX-listed companies and their dubious past behaviours. Small business is the real backbone of the nation and punishing big business would only hurt the SME area more.
- For our startups, keeping the $20k instant asset write off in place aft July 1 would show commitment to SMEs by the government and help all SMEs, not just tech startups.
- Provide certainty on the R&D tax offset incentive and allow quarterly incentives. A yearly scheme makes it hard for startups to manage cash flow efficiently and has driven startups to use the finance sector to access funds just to keep more cash in the business, but at a price.
- I would like to see education for STEM not just in schools but vocational and professional skills training as well.
- Past ESS changes have been supportive, but more can definitely be done to support startups to attract the best staff and reward them without tax being a primary concern for a young person wanting to work in a startup.
“Overall, the future health of the nation depends on SME’s being able to fund and sustain growth, to create jobs and wealth. I know the government, no matter the party, can extend and create consistency and simplicity of policy to help our startups grow, scale and prosper.”
The hopes for the Government to support the startup industry is still glimmering, and we know how important the government’s support can be. Looking at other countries with policies directed at startups like Singapore is thriving well and strong.
I guess we have to wait for Monday for the Budget 2018 to be released.