Labor’s first federal budget has been widely welcomed by the tech sector, despite one analyst telling Startup Daily it was “a non-event” for tech.
We called it a “socks, jocks and chocolates” budget from Labor, just five months after taking power and seven months before Treasure Jim Chalmers returns with his plans for FY24.
There were some concerns, but they’re mostly rent-seeking, like people who sell eBikes wanting more concessions for eBikes. And having spent recent months lauding the new industry and science minister, Ed Husic, after years of indifference by recent previous holders of the portfolio, and giving the March budget a C-minus, sentiment from the startup sector this time around was upbeat.
You can read more on what’s in the budget for the tech sector here.
And more broadly in the budget here.
Here are what several sector leaders, investors and founders thought of our new national fiscal priorities.
Commitments kept
Tech Council of Australia CEO Kate Pounder said she was pleased to see the government keep its election commitment to establish the $15 billion National Reconstruction Fund. She’s keen to see the council play a key role in designing the framework for the fund.
Tech Council CEO Kate Pounder
“We believe Australia has a once in a generation opportunity to be a global technology powerhouse, leading in critical tech fields that will be important to Australia’s future prosperity and security like Quantum, AI, robotics and cybersecurity,” she said.
“Despite Australia having comparative strengths in these areas, we are significantly under-investing compared to other nations and compared to other parts of the tech sector where Australia punches above its weight, such as business-to-business software and fintech.”
More cash to deal with the visa backlog, alongside increased migration got a cheer. Of course the TCA and government are in lockstep on a plan to hit 1.2 million tech jobs in Australia by 2030.
“Skill shortages in tech and cyber roles are impacting businesses across the economy. To get the most from this investment, we need quick action to improve the skilled migration system, including prioritising critical tech skills, such as cybersecurity, in visa processing and improving pathways to permanent residency,” Pounder said.
“We acknowledge Minister Ed Husic’s continued strong support for the technology sector and his work on partnering with industry.”
But there was a sour note for Pounder, a $4 million cut to the women’s tech workforce reskilling initiative.
“Women comprise only a quarter of the tech workforce, despite these roles being amongst the fastest-growing, most flexible and secure jobs in the country, with half the gender pay gap of other high-paying industries. So, we are disappointed to see funding cut to a program which had the potential to help improve these numbers,” she said.
“The reason is that many women never get the opportunity to enter the tech sector because women working in Australia today didn’t get the encouragement to study STEM in school or university.
“While we support the Government’s broader efforts to increase women’s workforce participation, including the $5.8 million over 5 years from 2022–23 to support women in science, technology, engineering and maths (STEM) through the Women in STEM and Entrepreneurship program, we simply don’t agree that it is wasteful to support women to reskill into high-skilled, high-paid jobs.”
Chris Vein, CEO of tech association ACS, said his organisation applauds the budget as a step towards boosting the diversity of the IT industry and broader economy.
“While we would have liked to have seen more tech focused measures announced, we have long been advocates of boosting the technology sector’s diversity. Enabling parents to enter, or get back into the workforce is an important step in allowing this,” he said.
“The government’s previously announced measures around TAFE places, support for advanced manufacturing, boosted NBN spending and revamped industry programs are all very welcome by everyone in the sector.
Mental health support
Airtree Ventures partner James Cameron – “a Canberra boy at heart” – said it was “fantastic” to see mental health support for SMEs prioritised.
Airtree Ventures partner James Cameron
“Founder wellbeing is intrinsically linked with the wellbeing of the company, yet the stats around mental health and startups are shocking – entrepreneurs are 50% more likely to have a mental health condition than the general population, with founders twice as likely to suffer from depression and suicidal thoughts,” he said.
As founders navigate some of the most challenging economic conditions Australia has faced in the last decade, we welcome the government’s decision to commit $15.1m in funding for mental health and debt counselling for SMEs.
“We also applaud the government’s focus on supporting families and boosting workplace participation. Improving accessibility to childcare and parental leave will be key in helping close the gender pay gap and achieving equity in the workplace, an area where the tech sector consistently falls short,” Cameron said.
“We’re hopeful that this, in conjunction with the $5.8m to go towards the Women in STEM and Entrepreneurship program over the next five years, will see more underrepresented genders enter the tech sector.”
His thumbs down are on getting rid of red tape for tech.
“Although these measures are positive, it’s disappointing we didn’t see more initiatives to better support Australia’s tech sector reach its full potential,”
“Technology is critical for Australia’s future economic prosperity yet skills shortages and the ability to attract top talent continue to be some of the most pressing roadblocks facing tech founders.
“While new university packages and the decision to raise the permanent migration cap are positive measures, it’s a shame the Government didn’t build on the groundwork they laid in the last budget to remove red tape for employee share schemes and skilled migration.”
Digital skills and training
Speaking of skills, Digital Skills Organisation CEO Patrick Kidd was chuffed with the investment in TAFE and vocational education and training (VET).
DSO CEO Patrick Kidd
“We are pleased to see the Government announce 480,000 fee-free TAFE and community-based vocational education places over 4 years. As a first step, the Government is entering a $1 billion agreement with the states and territories to provide 180,000 places in 2023,” he said.
The agreement prioritises training for students that traditionally face barriers to work and study, including women facing economic equality issues, and target industries with severe skill shortages.
“We also applaud the $50 million TAFE Technology Fund to modernise TAFEs, enabling students to take advantage of up-to-date IT facilities, workshops and laboratories.”
The Government also announced that a new 5-year National Skills Agreement will commence in 2024 to secure the long-term future of vocational education and training.
“We also welcome the establishment of Jobs and Skills Australia to strengthen the nation’s workforce planning, help address workforce shortages and build long-term capacity in priority sectors,” Kidd said.
“In addition, we are excited to see $6 million allocated to the Alannah and Madeline Foundation for the national rollout of the eSmart Digital Licence+, Media Literacy Lab and a new Junior Digital Licence+, to improve media and digital literacy and online safety awareness among primary and secondary school students.”
Course correction
Cicada Innovations CEO Sally-Ann Williams labelled it an inevitable “course correction budget” to address fundamental issues such as wages, cost of living, and climate change, among a range of pressing issues.
Cicada Innovations CEO Sally-Ann Williams
“Yet despite this, the government may have simultaneously managed to allocate more investment into critical growth sectors than Australia has seen for multiple terms of federal government,” she said.
“It’s extremely pleasing to see that climate change and decarbonisation have permeated throughout a great number of the budget decisions. From deep tech, to manufacturing, regional growth, national reconstruction, jobs, skills, and all the way to indigenous led support. The climate change bill and targets are visibly influencing this Government’s first federal budget.”
Committing to ambitious goals in energy transition can help to spur growth in local SMEs, Williams said.
“In turn we should see a strong growth in translational research driving new innovations to market, as these SMEs grow in size and complexity of product offerings,” she said.
“If this vision and investment continues, and increases, then Australia may reverse its decline in the economic complexity index, innovation index, and various other international competitiveness markers.”
The deep tech boss said it was also also great to see the strong focus on inclusion in areas such as gender, regional communities, First Nations people, and other underrepresented groups, and wants to see the details around the National Reconstruction Fund
“If this is focused on scaling existing SMEs, it’s a strong signal that we are investing in capacity building of industry leaders for the future,” she said.
“We should also ensure that this funding solves the multiple funding ‘valleys of death’ encountered specifically by deep tech SMEs.”
Cybersecurity
After a shocking few weeks on the data security front StickmanCyber CEO and founder Ajay Unni wondered why there wasn’t a clearer and bigger response.
StickmanCyber CEO Ajay Unni
“How many breaches need to occur before the government realises the seriousness of cybersecurity? Penalties are not a deterrent for these breaches if there is a lack of standards and knowledge that leads to these insufficient practices in the first place,” he said.
“$12.6 million over four years to protect 10’s of millions of consumers, is a joke. How is that going to make a dent? That funding is to combat scams and online fraud, with the bulk going towards a National Anti-Scam Centre. This won’t go far, which is a missed opportunity. Because consumer education is an area that must be further addressed, as most cyberattacks and breaches are the result of human error.”
Unni wants better funding for digital safety and education so everyone has a basic understanding of cyber-hygiene.
“With Australians’ data at risk, there needs to be a look at the bigger picture here, not haphazard funding for government departments and increased penalties for corporation,” he said.
“Harsher fines are not the answer. Instead the government should be helping to protect consumers data by enforcing businesses to invest in a minimum level of cybersecurity. This could be either tax deductible or come with a rebate for any organisation that is dealing directly or indirectly with consumer data.”
Childcare matters
Peak IT body the Australian Information Industry Association (AIIA) was happy with the commitments geared towards boosting the nation’s digital ecosystem.
CEO Simon Bush was happy with initiatives addressing the skills gap, visa delays and TAFE and VET places, alongside cost of living initiatives.
“Another key element of trying to bridge the alarming tech skills gap is welcoming and encouraging a wide range of demographics to the industry – that’s why the AIIA is in full support of the budget funding increase for childcare,” he said.
“This will allow more working parents, and particularly mothers, into the workforce – a group who are currently severely underrepresented within technology.”
The extension of cyber hubs for government agencies – hardening government IT against cyber threats – was welcomed.
“Cyber security rightly remains a focus for the government and the new $31.3m investment in government cyber resilience and security is necessary. We’ve unfortunately seen too many incidents in recent months, so it’s vital for the government to continue to harden its own cyber defences,” he said.
“Australia does have a digital divide between our cities and regions so the significant $1.2 billion in additional investment in NBN Co, particularly targeting regional areas and connectivity should lessen the barriers for regional Australia and assist in expanding the tech workforce in a post-pandemic world.”
Bush has already turned his attention to his wish list for next year’s budget in May.
“Areas around critical technologies, such as AI and Quantum, are of particular interest – they’ve received some funding in previous budgets but need far greater investment and accelerated implementation to ensure Australia can compete on a global stage,” he said.
The budget funding of $4.8 million towards greater support for Quantum research and PhD’s is definitely a step in the right direction, as we can not afford to fall further behind our international peers.”
Thanks for the fish
And just in case you’re wondering how the rest of Australian business feels, here are the throughs of the Seafood Industry Association CEO Veronica Papacosta, after the government announced $1.6 million to work with the seafood and hospitality sectors to develop mandatory Country of Origin Labelling for seafood.
“On behalf of Australia’s commercial seafood industry I would like to extend my congratulations and thanks to Prime Minister Anthony Albanese, Treasurer Jim Chalmers, Minister for Agriculture Murray Watt, Minister of Industry Ed Husic, Assistant Minister Manufacturing Tim Ayres and Australian Labor Party (ALP) for their strong commitment to Australia’s great seafood producers,” she said.
Sorted.
Trending
Daily startup news and insights, delivered to your inbox.