IT Venture Capital at Risk Says ACS
Tuesday 25 March 1997 - The Australian Computer Society has welcomed the initiatives in the Federal Government’s "More Time for Business" statement but questions whether they go far enough.
ACS Vice-President Prins Ralston said that yesterday's announcement was the first one delivered of a series of promises made at the last Federal election that would directly assist small businesses in the high-tech sector.
"It is to be hoped that the remaining commitments are not too far behind as people in this area of the private sector accepted the (now) Government's promises on face value and have been disappointed at the time it has taken to fulfil these promises," he said.
"We are delighted to see the injection of capital for investment in small high technology firms that will come through the new Small Business Innovation Fund. It is true, as Mr Howard commented that, "Small business cannot afford excessive overheads and on-costs", and consequently there should be more in the package which seeks to remove barriers to entry in the form of infrastructure costs for these companies.
"Australian companies are faced with some of the highest telecommunications costs in the world while trying to compete against subsidised US markets. Our high tech-companies are severely disadvantaged in this regard and yet we expect their products and services to be internationally competitive."
Mr Ralston also said the Small Business Innovation Fund could be seen simply as a reversal of last year’s budget cutbacks to the industry assistance programs, with $130 million coming from the START R&D program and only the remaining $70 million to come from the private sector.
"The move to allow small businesses to make voluntary tax payments or even defer their tax liability to ease cash-flow is welcome news, as is the decision to create a ‘one stop shop’ under which small business will be able to lodge documents for taxation, the Australian Securities Commission, the Australian Bureau of Statistics and insurance.
"These measures will certainly ease the bureaucratic burdens faced by these companies, but the benefits of these innovations will be mitigated by new compliance requirements, especially the Family tax initiative," he said.
"In making his statement, Mr Howard called small business ‘the engine room of the Australian economy’. However his Government has failed to address the wholesale tax changes that other competitor countries like Malaysia and Singapore have implemented, and that the ACS called for in our recent submission to the Information Industries Taskforce, so Australia remains on the back foot.
"It is imperative that Australia has venture capital to invest in IT, but this is only half the story. The high cost and inadequacy of our infrastructure remain a serious obstacle to the success of our high tech organisations on the global market. The impact of this could well be that the venture capital is unused or even at risk."
This media release is located on the web at: http://www.acs.org.au/news/venture.htm
ENDS
Media Enquiries:
Prins Ralston, ACS Vice President, Tel: (0889) 466 264 or (0418) 898 456, Email: p_ralston@darwin.ntu.edu.au
Caroline New, Caroline New PR, Tel: (02) 9630 2108 or (0411) 889 456, Email: cnew@acslink.net.au
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