Business fund to push more investment

The Morrison government will push ahead with a plan to invest $100m into small businesses through a new “business growth fund”.

Australian Prime Minister Scott Morrison and Australian Federal Treasurer Josh Frydenberg in the House of Representatives at Parliament House in Canberra. Picture: AAP Image/Lukas Coch

The Morrison government will push ahead with a plan to invest $100m into small businesses through a new “business growth fund”, amid criticism that the policy attempts to “pick winners” with taxpayers’ money.

Josh Frydenberg will release exposure draft legislation on Monday to establish the fund, which will also draw money from banks and financial institutions to make equity investments into small and medium-sized enterprises. It’s understood the government is talking to several banks and superannuation funds about partnering in the fund, which it hopes will grow to about $1bn as it matures.

The Treasurer said legislation to establish the fund would be introduced into parliament by the end of the year.

The fund will provide “passive equity” in 30-50 businesses a year, enabling them to grow without taking on additional debt or giving up control.

But Institute of Public Affairs executive director John Roskam said: “Governments and especially Coalition governments shouldn’t pick winners.”

BEN PACKHAM