Labor will introduce Startup Year to potentially create 2,000 new firms and provide a platform for future job growth and economic opportunity.
Under this program, Labor will offer income contingent loans to 2,000 final year students and recent graduates to support their participation in accelerator programs.
This new approach will grow Australia’s pool of young entrepreneurs, help drive innovation and grow much-needed links between universities and the startup community, encouraging universities to draw in private sector mentors and investors.
Startups have been shown to possess very good job creation potential - encouraging these new firms is good for the economy and job growth.
Government can stimulate the national focus on entrepreneurship by championing the growth of new firms, especially those created by young Australians.
These concessional loans will provide students with the option of taking an additional business-focused year working with an accelerator to develop their innovative startup ideas.
To be eligible, Startup Year entrepreneurs must be participating in an accredited program, such as a university accelerator. Labor will work with universities, incubators and accelerators to establish an appropriate selection criterion
Accelerator programs provide mentoring and professional development that will support the development of successful business ideas and improve the potential longer-term sustainability of these firms.
The Startup Year loans will be delivered through the existing HELP system.
The loan would be designed to help cover costs associated with participation in the accredited accelerator program, up to the maximum Band 3 annual student contribution level under the HECS system.
Program design would look to support the emergence of startups with founders from a diverse range of backgrounds and regionally based enterprises.
This policy aims to support more productive relationships between industry and the tertiary sector through supporting the development of university accelerators and incubators.
Working with higher education institutions, entrepreneurs and investors will be better placed to identify opportunities for commercialisation of university research. Building these links should also make it easier for potential entrepreneurs within universities to seek out business opportunities.
The Coalition Government has had a sporadic interest in supporting national innovation activity.
Not surprisingly according to the Global Innovation Index (GII) Australia has fallen four places to 23 since 2013. Between 2018 to 2020 the Morrison Government oversaw the steepest decline from 20 to 23.
A 2019 IMD World Competitiveness Centre study highlighted that Australia’s slipped from 9 in the world in 2015 to 14 in 2019 for digital readiness.
This lack of support has perpetuated a culture that pushes aspiring and gifted Australian innovators offshore – depriving Australia of jobs and increased sovereign capability.
Post pandemic, there is a need for government to assume a leadership role encouraging entrepreneurial activity and the emergence of new firms that can use tech for social good or improve the productivity and efficiency of other businesses.