Coronavirus: Business calls for big boost to R&D
Josh Frydenberg is under pressure from business leaders and the opposition to roll out a substantial manufacturing package in the October budget.
Josh Frydenberg is under pressure from business leaders and the opposition to roll out a substantial manufacturing package in the October budget to protect Australia from future global supply chain shocks.
Opposition employment and industry spokesman Brendan O’Connor said research and development was “inextricably linked to a recovery led by advanced manufacturing”.
Mr O’Connor, responding to calls in The Australian from Port of Newcastle chair Roy Green and Business Council of Australia chief executive Jennifer Westacott to boost the country’s R&D capacity, said the government must develop a “comprehensive manufacturing and industry plan to drive employment and boost economic growth”.
Andrew Liveris, former chairman of The Dow Chemical Company who is leading the Northern Territory’s Economic Reconstruction Commission, is preparing a major manufacturing strategy for the government ahead of the October 6 budget.
With the manufacturing sector the second-largest spender on R&D, Mr O’Connor accused the government of “ripping $1.8bn from the Research and Development Tax Incentive”.
“The Morrison government speaks publicly against raising taxes to drive economic recovery but … they want to increase the tax burden on innovative firms by nearly $2bn,” he said.
“The RDTI is retrospective, with an operational date of 1 July, 2019, meaning if passed in its current form, the government will claw back money from investments made by businesses under the current law.
“COVID-19 has demonstrated just how vulnerable Australia is to global supply chain shocks.”
Professor Green, who advised Julia Gillard on manufacturing and is supporting Mr Liveris on his work with the COVID-19 Commission, told The Australian it was time for governments and the private sector to take investment in R&D “seriously”.
Ms Westacott said “we need to get smarter about how Australian businesses can be quality and specialist suppliers in the global supply chain”.
Mr O’Connor said without action, manufacturing was “dangerously exposed to turbulence in the global economy”.
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