Swan's ‘B+’ 2009/10 Federal Budget at a glance

By Ry Crozier on May 13, 2009 3:07 PM
Filed under Finance

Budget 2009-10 has revealed scant direct ICT stimulus measures apart from the NBN but a number of indirect opportunities around innovation, prompting the AIIA to rate it a ‘B+’.

Speaking to iTnews from Canberra, Australian Information Industry Association chief Ian Birks welcomed innovation-oriented announcements in the Budget, following an earlier closed-door briefing with the Innovation Minister Kim Carr.

But he lamented the fact that ICT capability hadn't been called out specifically as part of the third round of stimulus investment in the economy.

"It's a battle we'll continue to have to work on," Birks said.

The key announcements in the 2009-10 Federal Budget that are likely to impact the ICT industry include:

  • A four-year, $185.5 million funding extension for National ICT Australia (NICTA)
  • An $80 million rural and regional NBN initiative, which includes funding for the ABC to create "virtual town squares" to facilitate collaboration, and $5 million to employ NBN co-ordinators to oversee the Backhaul Blackspot scheme.
  • A $196 million grant for a Commonwealth Commercialisation Institute - the details for which are scant.
  • An R&D tax credit scheme of up to 45 per cent, replacing the R&D Tax Concession. It is understood the new scheme will allow organisations making a loss to still claim a tax credit.
  • A $10 million scheme to enable small businesses to take advantage of e-business opportunities.
  • A 50 per cent tax break for small businesses that purchase "eligible assets" and plant. These assets include ICT hardware but software again looks to be ineligible.
  • Major reforms in Defence to create "more efficient enterprise support functions" in areas such as ICT infrastructure, a plan to reduce the use of contractors and providing more centralised support to the ADF. Defence claims that these cuts will deliver savings of approximately $0.5 billion across "forward estimates" and $3.5 billion across the decade.
  • A Defence directive to use more videoconferencing in place of single-day travel, and to procure "more competitively-priced products".
  • A $50 million boost to the Export Market Development Grant Scheme.
  • The expansion of Do Not Call Register to cover business phone and fax numbers - which looks to be at the telecommunications industry's expense.
  • The establishment of Renewables Australia - an industry body to promote development, commercialisation and deployment of renewable technologies.

"There's probably a lot of opportunity in the outcomes of this budget process for ICT companies to get creative and take advantage of these initiatives," Birks said of the list.

"I think in general there's a lot of commendable focus on innovation with $5.7 billion over four years to be spent on education, research and innovation, representing a 25 per cent increase in funding year-on-year.

"There isn't a lot of really direct call out with regards to the ICT industry in any of this but ICT benefits from a lot of things in the package [indirectly] anyway."

Birks said he had been briefed in detail on the innovation aspects of the Budget but "hadn't gotten as much detail as I'd like" on other aspects that may impact ICT. Birks expects "a lot of promise" from the Commonwealth Commercialisation Institute, for example, but the public as yet has very little idea as to what the Government proposes the Institute will do.

Birks said the AIIA would continue to lobby the Federal Government to admit software as an eligible asset under the small business tax break scheme, but said "it will take some time".

iTnews will be canvassing industry reactions to these budget measures in the coming days. What are your thoughts on the measures announced? And more importantly, what details are missing?

 
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