Backing Australia's Ability

Specifically, the Government will enhance the R&D tax concession arrangements. In addition to the existing 125 per cent R&D tax concession, companies that undertake additional R&D will be able to access a premium rate of 175 per cent on the additional investment. This premium targets the labour-related components of R&D expenditure and so will help develop Australian skills and expertise.

In accordance with the approach taken to business tax reform, effective-life write off will apply to the Government’s existing R&D tax concession scheme, simplifying it and providing a consistent treatment between R&D plant and other capital items in the tax system.

We’ve also recognised that often the most exciting developments may emerge from smaller companies and the Government will introduce a tax rebate for the R&D tax concession to help the cash flow of these type of organisations. Over five years, it’s estimated up to 1300 small companies that are in tax loss will get early access to $30 million at a net cost of $13 million.

Finally our absolute commitment to the small and medium-enterprise sector will see $535 million over five years used to maintain the highly successful START program into the future – it becoming an ongoing mechanism to help the hundreds of companies where grant assistance is most appropriate.

Accelerating the commercial application of ideas

At the very heart of our plan is to turn Australian ideas into incomes and jobs for Australians. That’s been a common concern in the past – we don’t intend for it to be in the future.

It’s a complex issue that requires several different approaches – better flow of finance into business innovation, encouraging start-ups directly out of research institutions and strengthening intellectual property management processes.

It’s also vital to bring together the skills of those in business, universities and governments to pull together ensuring the best Australian ideas can be transformed into products and jobs. Backing Australia’s Ability will assist the greater commercial application of research from universities and public sector research agencies, like the CSIRO, by encouraging the commercial linkages with industry and removing impediments for promising research to go forward to the stage of commercial viability.

The Cooperative Research Centre concept has tremendous potential to further the spin-off opportunities from industry research collaboration. The Government will boost the CRC Program by 80 per cent over the next five years at a cost of $227 million.

Greater flexibility will also be incorporated to allow for larger CRCs to be established and small and medium enterprises provided with greater access to the program.

And, once again, with an eye to improving opportunities for the SME sector, an extra $40 million over four years will more than double in value the highly successful Commercialising Emerging Technologies, or COMET Program as its known, to provide early assistance to firms by improving their commercialisation skills.

Also of significance to this sector, funding of $100 million will be provided for an Innovation Access Program to ensure Australian access to the best overseas technology and science and develop international bilateral agreements for this purpose.