Australian Information Industry Association


Innovation Policy Position Statement

Update - 24 September 2018: AIIA has now released our Innovation Policy Position Statement

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Innovation is the number one priority for AIIA members according to a survey of members undertaken across June and July 2018.

Australia’s position in the Global Innovation Index has gone down from 18 to 20 from 2010 to 2018. Australia is behind leaders such as Switzerland, UK, Sweden, US, Finland and Singapore. We are also below closer economies such as that of New Zealand, Hong Kong and Korea.

While Australia is putting considerable effort into the elements that foster innovation – ranking 12th in the world on inputs, it has yet to see the results in terms of outputs ranking 30th in innovative outputs.  Therefore, we need to reconsider what we need to do to improve our innovation outputs.

“Digital innovation can deliver $315 billion in gross economic value to Australia over the next decade, making it a critical ingredient in the nation’s ongoing economic success” says a report commissioned by Data61. The report finds that the total economic value derived from digital innovation in Australia represents 7.4 per cent of the country’s total GDP over the past two decades, compared with 11.2 per cent of GDP in advanced economies.

Australia’s ongoing prosperity depends on its ability to innovate.  This requires leadership, clear policies and a national innovation strategy coupled with bi-partisan commitment to structural reform, investment and human capital. Building a sustainable innovation capital requires both an immediate and long-term focus.

The key challenges for innovation in Australia are:

1. Compared to competitors (China, South Korea, UK, USA, Singapore and New Zealand) Australia’s investment in innovative high-tech start-ups is poor;

2. Australia lacks a holistic approach to innovation by Government and industry that encompasses immediate and long-term focus and a sense of urgency to
ensure Australia is globally competitive into the future;

3. An Australian Government R&D tax incentive scheme that is becoming increasingly compliance focussed and less directed at fostering innovation, research
and development;

4. Inadequate investment funds for innovation from Government and business;

5. Improving commercialisation of Australia’s innovation, research and development efforts in local and overseas market; and

6. Attracting overseas talent and local development of skills in commercialisation of ICT products and services.

AIIA Recommendations:

The AIIA recommends Government, industry and research institutes collaborate to develop and implement:

  1. A clearly articulated National Innovation Strategy that includes a road map and reports publicly on success and failures and lessons learnt.
  2. Legislation that fosters innovation and encourages research and development in Australia.  Examples include:

    a. Reducing the company tax rate – currently above the OECD average; Ensuring R&D tax concession arrangements foster innovation rather than impose   
    further compliance burdens on business;

    b. Improving and communicating capital raising rules and venture capital to retain and attract innovation, entrepreneurs and start-ups onshore;

    c. Introducing capital gains exemptions and/or tax deductions to enable up-front tax deductibility of angel investments; and

    d. Amending of the Corporations Act to support appropriate entrepreneurial risk-taking, e.g., the AICD’s “Honest and Reasonable Director Defence”.

    3. In order to foster commercialisation of Australian innovation:

    a. Enable seasoned and successful commercialisation experts from overseas to migrate to Australia;

    b. Develop local talent in commercialisation through mentoring, education and working with overseas and local experts;

    c. Develop structured collaboration models between government, researchers and businesses directed to achieve tangible commercialisation outcomes  
    which also considers exporting options;

    d. Incentivise Government and industry investment in research and technology infrastructure that underpins and enables innovation;

    e. Improve and communicate capital raising rules and venture capital to retain and attract innovation, entrepreneurs and start-ups onshore; and

    f. Develop and implement a system of metrics to measure and report on the impact of investment on the commercialisation of innovation in Australia.
  3. Government procurement legislation, frameworks, processes and arrangements which encourage innovative business solutions and services and explicitly positions Government as a champion for innovation.
AIIA will...

1. Advocate for bipartisan support for a National Innovation Strategy and road map which incorporates building innovation and commercialisation capability in      Australia at the 2019 federal election;

2. Leverage the National iAwards Program, a platform that celebrates, supports and profiles Australian digital innovators and entrepreneurs;

3. Use the AIIA Summits held Nationwide as a platform for promoting innovation and commercialisation in the ICT sector;

4. Provide networking opportunities to connect individuals and organisations across sectors and create new value;

5. Provide a voice for entrepreneurs, “intrapreneurs,” researchers, academics and investors who contribute to a National Innovation Strategy through advocacy, policy development, and facilitating meetings with key government decision makers;

6. Actively engage with government on legislation reform; and

7. Contribute to skills development in commercialisation through mentoring, outreach to educational institutions, and industry workshops.

Supporting AIIA documents

The following documents support AIIA’s policy position on Innovation

Vision for a Science Nation - AIIA Response

Department of Communications and Bureau of Communications Research Strategic Policy Priorities

Re-Think: Tax discussion paper. AIIA response

Barriers to Services Exports: Productivity Commission Issues Paper

ICT Statistics Review 2014-15

Boosting the commercial returns from research

Industry Innovation and Competitiveness Agenda

Australia’s National Innovation System

Reference documents

The following reference documents have helped inform AIIA’s policy position relating to Innovation.