Trump's war on innovation is a golden opportunity for Australia, if we're smart enough to take it
Our productivity growth, the only reliable way to raise living standards, is sclerotic. We now rank 27 out of 31 OECD countries, with the UK and US achieving three times and eight times our growth rate respectively. And with the future of our resource exports growing cloudy, the 'lucky country' might be starting to run out of luck.
Jump-starting Australian innovation would give us a chance to break out of this uninspiring position and provide a path to a more prosperous future.
Frustratingly, we're on track to squander this opportunity. While competing destinations have launched ambitious programs like the Choose Europe for Science Initiative, backed by €500 million ($881 million), Australia has dragged its feet. A recent proposal to tax unrealised capital gains has spooked start-ups and their investors, and Labor's ongoing desire to cap foreign student numbers actively harms our chances.
Loading
To reverse course and win the war for global talent, we require a bold, coordinated, 'big push' strategy to ensure that Australia offers the most compelling alternative to the US as a place to discover scientific breakthroughs, develop technologies and build companies.
Our big push strategy should target the four key types of individuals that define the best innovation ecosystems: world-class researchers; risk-taking entrepreneurs; high-skilled technical workers and promising young students.
We can target each talent category with two types of policy levers.
First, make it as easy as possible to choose Australia. For top talent and their families, getting an Australian visa should be a fast and seamless experience. Labor's National Innovation Visa is a good start but is too restrictive; it could be significantly expanded, for example by removing the 'invitation only' requirement and introducing a fast track for affected Harvard scholars. Supply-side housing action to address the ongoing crisis, such as zoning reform, is long overdue to make Australia welcoming to new migrants. Select new arrivals could merit limited financial support to smooth the transition, and for top professors who bring research affiliates in tow – think of the benefits we have seen from international researchers like Professor Michelle Simmons basing their careers in Australia – tailored incentive packages would provide excellent bang for the public buck.
Second, invest in the success of Australian-based innovators. For scientists, that means aggressively reversing the decline in R&D funding that Robyn Denholm, chair of the ongoing National R&D Review, has called a 'national emergency'. Opportunities to fund 'shovel-ready' research projects cut by the US are plentiful. For entrepreneurs and high-skilled workers, selective support for companies in high-potential or strategic sectors such as public offtake agreements, can support the growth of new products and businesses.
These policies can be targeted at places where Aussie innovators have already proved their strength. Hubs such as Melbourne's biotech district, Sydney's SaaS (Software as a Service) scene, or the Gold Coast's growing space industry provide natural focal points for new talent to coalesce and amplify.
Labor's historic election victory has given them a rare licence to invest in a better, more exciting future. For Albanese and Chalmers, who have publicly committed to solve our productivity crisis, this opportunity to boost innovation in Australia couldn't have come at a better time. They should seize the chance to do so.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
West Australian
23 minutes ago
- West Australian
Labor reluctant to make changes to super proposal
Treasurer Jim Chalmers is remaining firm on proposed superannuation changes, as Labor goes back to the drawing board to negotiate with the Greens. Under the proposal, the concessional tax rate would double to 30 per cent on the portion of super balances above $3 million. The policy aims to curb the number of high net-worth individuals using superannuation for tax deduction purposes rather than for their retirement. Dr Chalmers said the government didn't have the numbers in the Senate to pass the legislation and needed to engage with the crossbench. "Our intention and our preference would be to legislate what we announced," he told ABC radio on Thursday. "We've done years of consultation now. "In this case, with the Greens in the Senate to try and legislate the plan that we announced all of those years ago." With the median super balance for 60 to 64 year olds sitting at roughly $200,000 for men and $150,000 for women, the vast majority of Australians are unlikely to feel the impact of Labor's proposal. It is estimated to affect 0.5 per cent of Australian savers, or roughly 80,000 people according to the Australia Institute. The wealthiest 10 per cent are receiving 40 per cent of superannuation tax breaks, the treasurer says. The 42 self-managed super funds with more than $100 million in assets receive more than $140 million every year in tax breaks, according to reports. But the coalition has vowed to fight back against the policy, as they are opposed to any tax on unrealised gains. Shadow treasurer Ted O'Brien said he didn't believe it was a "fair call" and said younger Australians would be caught in the net over time. "Our belief as a coalition ... is that Australia should have lower tax, simpler tax, and fairer tax, and what Labor is putting on the table with its superannuation tax breaches all of those things," he told ABC's News Breakfast. "Every aspect of this is looking awful, and it certainly does not align with our values as a Liberal Party, or indeed, a Liberal National coalition." Critics say the policy's introduction of a tax on unrealised capital gains goes against the fundamentals of the tax system and would have unintended consequences, such as driving investment off-shore and threatening Australia's financial stability. Unrealised gains are 'paper profits' - increases in the value of assets such as properties or shares that haven't been cashed in. On Wednesday, Dr Chalmers said calculation of unrealised gains was not unique in the tax system, and that any losses can be carried forward against any gains. Tax on unrealised gains is already part of the Australian tax system and is, for example, paid under land tax regimes. The Greens support the legislation in principle but want the threshold lowered to $2 million and indexed in line with inflation. Greens senator Sarah Hanson-Young said the ball was in the government's court. "We want a reform to the system that makes it stronger and fairer," she told Sky News on Thursday.
Perth Now
25 minutes ago
- Perth Now
Labor reluctant to make changes to super proposal
Treasurer Jim Chalmers is remaining firm on proposed superannuation changes, as Labor goes back to the drawing board to negotiate with the Greens. Under the proposal, the concessional tax rate would double to 30 per cent on the portion of super balances above $3 million. The policy aims to curb the number of high net-worth individuals using superannuation for tax deduction purposes rather than for their retirement. Dr Chalmers said the government didn't have the numbers in the Senate to pass the legislation and needed to engage with the crossbench. "Our intention and our preference would be to legislate what we announced," he told ABC radio on Thursday. "We've done years of consultation now. "In this case, with the Greens in the Senate to try and legislate the plan that we announced all of those years ago." With the median super balance for 60 to 64 year olds sitting at roughly $200,000 for men and $150,000 for women, the vast majority of Australians are unlikely to feel the impact of Labor's proposal. It is estimated to affect 0.5 per cent of Australian savers, or roughly 80,000 people according to the Australia Institute. The wealthiest 10 per cent are receiving 40 per cent of superannuation tax breaks, the treasurer says. The 42 self-managed super funds with more than $100 million in assets receive more than $140 million every year in tax breaks, according to reports. But the coalition has vowed to fight back against the policy, as they are opposed to any tax on unrealised gains. Shadow treasurer Ted O'Brien said he didn't believe it was a "fair call" and said younger Australians would be caught in the net over time. "Our belief as a coalition ... is that Australia should have lower tax, simpler tax, and fairer tax, and what Labor is putting on the table with its superannuation tax breaches all of those things," he told ABC's News Breakfast. "Every aspect of this is looking awful, and it certainly does not align with our values as a Liberal Party, or indeed, a Liberal National coalition." Critics say the policy's introduction of a tax on unrealised capital gains goes against the fundamentals of the tax system and would have unintended consequences, such as driving investment off-shore and threatening Australia's financial stability. Unrealised gains are 'paper profits' - increases in the value of assets such as properties or shares that haven't been cashed in. On Wednesday, Dr Chalmers said calculation of unrealised gains was not unique in the tax system, and that any losses can be carried forward against any gains. Tax on unrealised gains is already part of the Australian tax system and is, for example, paid under land tax regimes. The Greens support the legislation in principle but want the threshold lowered to $2 million and indexed in line with inflation. Greens senator Sarah Hanson-Young said the ball was in the government's court. "We want a reform to the system that makes it stronger and fairer," she told Sky News on Thursday.
West Australian
an hour ago
- West Australian
Australian news and politics live: Ted O'Brien accuses Labor of tax grab as superannuation negotiations break
Scroll down for the latest news and updates. Independent Nicolette Boele says she is 'very confident' in the outcome of the Bradfield recount, which saw her narrowly defeat Liberal candidate Gisele Kapterian by 26 votes after weeks of intense counting and scrutiny. 'I think I'm very confident with the process that's been run by the AEC and the outcome that we have here. So I'm keen to get on with the job, but I can understand you might need to ask that question to Giselle Kapterian,' Ms Boele told ABC RN Breakfast. Boele described the Australian Electoral Commission's process as 'one of the most impressive and comprehensive' she had seen, and praised her opponent as a 'formidable candidate.' The AEC confirmed the recount was conducted transparently and thoroughly, with scrutineers from both sides present throughout the process. Treasurer Jim Chalmers says the government is prepared to work with the crossbench to secure passage of Labor's superannuation tax changes. Asked whether the government was offering a 'take-it-or-leave-it' deal and if concessions had been ruled out with the Greens, Chalmers said: 'We don't have the numbers in the Senate to pass our legislation on our own. We need to engage with the crossbench, in particular, in this instance. And I intend to do that,' while speaking to ABC RN Breakfast. He added, 'But our intention, our preference, is to legislate the plan that we announced almost two-and-a-half years ago now.' Australian and European Union trade negotiators will spend two days thrashing out the details of a potential new agreement after a breakthrough meeting between Australia's Trade Minister and his EU counterpart in Paris. The trade talks collapsed in 2023 over the EU's refusal to allow more Australian beef into the single market. But as a result of US President Donald Trump imposing tariffs on the EU and Australia, and most recently increasing duties on steel to 50 per cent, both sides want to see if they can try again. The Nightly revealed that during the election campaign , Senator Farrell held a virtual call with his new EU counterpart, the Trade and Economic Security Commissioner Maroš Šefčovič, for a preliminary meeting. That meeting made progress. And in a positive sign, both sides cleared their diaries for their top trade negotiators to meet in Brussels as soon as this week for two days. Senator Farrell told The Nightly that Mr Secovic was 'warm and engaging'. 'We had a good meeting and discussed how we can strike while the iron is hot,' he said in an interview by phone from Paris. Read the full story here. Australia's economy recorded just 0.2 per cent growth in the March quarter, sparking questions about the nation's resilience. Despite the modest figure, Treasurer Jim Chalmers insists the economy is holding up well, citing improvements in inflation, wages, and interest rates. 'The Australian economic story is a very compelling one. The economy continues to grow, we've got inflation lower, real wages and incomes are growing, interest rates have started to come down, we've got the debt down in the budget. And so, overwhelmingly, Australia's economy is performing relatively well compared with the rest of the world,' Dr Chalmers told RN Breakfast on Thursday morning. 'Even modest growth in these global circumstances is welcome. We do have a global economy which is characterised by uncertainty and volatility and unpredictability,' he said. Ted O'Brien expressed his disappointment after the Liberal Party lost the traditionally safe seat of Bradfield to independent candidate Nicolette Boele following a recount. The Australian Electoral Commission confirmed on Wednesday that Boele won by a narrow margin of 26 votes after a full recount. The contest had been closely fought for weeks, with Liberal candidate Gisele Kapterian and Boele exchanging leads. 'I'm sad to see those results,' O'Brien told ABC News Breakfast. 'Of course, the party at the level of New South Wales, the division, will be reviewing those results as will Giselle who is the candidate there. So let's wait to see how that review goes but I was sad and it does hurt to see that.' The loss ends the Liberal Party's 76-year hold on the Sydney North Shore seat. The recount process included a thorough review of all votes, with the AEC finding two instances of inadvertent double voting but no deliberate fraud. Ms Kapterian has thanked the AEC for their work and said she will carefully review the two counts. The result does not affect the overall balance of power, with Labor holding 94 seats and the Coalition 43. Any chance of a deal between the Coalition and the Government on superannuation reforms appears to have collapsed, after Treasurer Jim Chalmers accused the opposition of not being 'fair dinkum' in negotiations. But Shadow Treasurer Ted O'Brien has pushed back on ABC News Breakfast, blaming Labor for the standoff. 'Well, I have already outlined our concerns and the Treasurer is saying he's proceeding anyway and he's running to the warm embrace of the Greens in the hope of just jacking up taxes,' Mr O'Brien said. 'So we're clear with our principles. Lower taxes, simpler taxes, fairer taxes, and so that's where we stand on it. And clearly what the Treasurer is saying is he's not interested in lower taxes, simpler or fairer ones and that's for him to make that decision. 'If he wants to hurt Australians with higher taxes at this stage, well, that's on him.' The standoff comes as the government prepares to lift the Superannuation Guarantee rate from 11.5 per cent to 12 per cent from July 2025, and to introduce a higher 30 per cent tax rate on super balances above $3 million, changes the Coalition has strongly opposed. A Liberal state minority government is in political turmoil with a premier set to be dumped by parliament and a snap election looming. Tasmanian Premier Jeremy Rockliff faced a no-confidence motion on Wednesday, with a marathon debate expected to continue when sittings resume on Thursday morning. The motion, put forward by the Labor opposition, appears all but certain to pass with support of the Greens and three crossbench MPs. Mr Rockliff has conceded the numbers are against him but has vowed to 'fight to his last breath' and not resign. This stance could end up triggering an election, some 15 months after the Liberals were returned to power, governing in minority with just 14 of 35 seats in the lower house. Labor and some of the crossbench have lashed Mr Rockliff for budget 'mismanagement' and delays and cost blowouts to the delivery of two new Bass Strait ferries.
