Michael Sainsbury | November 18, 2008
KEVIN Rudd's Government has splashed $16.7 billion of taxpayer funds trying to prop up the faltering economy and the troubled car industry.
There's little sign from Kevin Rudd of any real Government plan to use taxpayer funds to help emerging technologies
It is certainly a role of government to use fiscal policy to prop up and kick-start the economy when times are tough, but neither package is by any means assured of success.
The $10.5 billion handout to old people (long overdue) and people with children is just as likely to be spent on knocking down the balance on credit cards of mortgages or popped into the bank than flushed into the retail sector. And we all know the success rate of car industry plans over the years.
It is ludicrous in these globalised times to continue to underpin loss-making sectors, and trying to pick "winners" in the subsidy game smacks of pandering to vested interests - such as trade unions.
Surely this is a good time to look toward the future, to help shape the Australian economy of the next few decades and beyond.
Australia's dream ride at the very top of the global boom rode on the rocks', rather than the sheep's, back.
After each such cycle, when we ride high due to natural resources or agriculture, politicians promise to reshape Australia industry so we have more home-grown success.
Or at least they should, and they should spend taxpayer dollars where it may actually have a multiplier effect, creating new companies and industries, employment and home-grown wealth.
Some of the car money was earmarked for cleaner technology, but there has been little sign from Rudd or his responsible ministers that there is any real Government plan to use taxpayer funds to help emerging technologies.
Sure, there is some rebadging of a few bits and piece of Howard government budget initiatives, but no real signs of commitment - or a cross ministerial group, for instance - to focus on driving innovation and technology industries.
The single infrastructure spending commitment so far is the $4.7 billion of taxpayer funds being tipped into the grandly named National Broadband Network.
But for that project - tenders for which are due next week - to succeed it must be structured to promote innovation. The nation cannot afford to have it dominated by Telstra for the sake of its 1.6 million shareholders at the expense of the rest of the country.
Of course, Telstra would argue otherwise, but its record speaks for itself.
Better, faster and more reliable broadband is as essential as electricity to the development of a digital economy that relies heavily on software and send large data files over the internet.
Yet, to use the car analogy, what is the point of committing public funds to build an improved information superhighway if the Government stints on building better "cars" to run on that highway - cars we can then sell offshore to run on other countries' broadband networks.
The often ignored early-stage venture capital sector in Australia - the place funds innovation and new ideas at the very start of their corporate lives has long struggled to find investors.
In scale, frankly it requires a lot less than propping up the rusty old auto industry.
By way of example funding for the tech incubator NICTA, which is beginning to commercialise its research, gets a relatively paltry $375 million from government between 2003-2011. Small beer compared with the car sector.
As it sprays taxpayer money around to grow the economy, the Government should think hard. Perhaps it should consider a national innovation fund set aside for investment in new technology, clean energy and bio-technology.
Otherwise Australia risks becoming even more like the land that time forgot.