A new report has questioned the current lack of government policy support for start-up businesses and early stage innovation.
In an update to its Crossroads report on the state of early stage innovation in Australia, not-for-profit group StartupAUS has expressed disappointment over the lack of support for the start-up sector.
The report, which acknowledges the potential of biotechnology but is primarily focussed on internet companies, calls for government to shift the policy focus to the educational curriculum, cultural and capital investment.
The need to build "a viable and sustainable ecosystem could not be more urgent," it says.
"The report further notes a dramatic fall in the government’s provision of matching capital to support startups, with the Innovation Investment Fund abolished in last year’s budget and the Entrepreneurs Infrastructure Program having only half the funding for startups of Commercialisation Australia, the body it replaced."
It says Australia is "performing poorly" compared to its regional neighbours and globally.
"China recently announced the creation of an $8.3 billion seed-stage National Venture Capital Fund, South Korea is implementing a $4 billion Creative Economy initiative, and New Zealand is extending its network of government supported startup incubators, innovation precincts and funding programs for startups.
"Further afield, the UK is delivering a multi-billion pound suite of pro-startup programs, while at the same time Australia still lacks a coherent innovation strategy, and has reduced its investment in knowledge economy initiatives at a time when almost all other developed economies are increasing theirs," it says.
The report recommends the creation of a national innovation agency to give greater focus to Australia’s efforts to transition to a knowledge economy.
It also recommends the creation of a national network of entrepreneurship centres and an increase in the Government’s provision of matching capital to support startups.
Shadow Minister for Innovation and Industry Kim Carr said the report and evidence given yesterday to the Senate inquiry into Australia’s innovation system shows "what the Abbott Government has never understood: that Australia’s economy and its innovation system are one and the same."
"The Government has yet to understand that commodity exports alone are not sufficient to secure our prosperity. Australia needs an innovation strategy and a plan to create the high-tech, high-skill and high-wage industries and jobs of the future," he said.