Labor has criticised the government for being “all talk” when it comes to innovation, after plans to produce draft legislation for equity crowdfunding were pushed back to the end of the year.
Although former small business minister Bruce Billson had hoped to introduce legislation to parliament during the spring session, the government is now consulting with stakeholders before producing the draft by year’s end.
Shadow treasurer Chris Bowen was highly critical of the government’s delay in parliament yesterday.
“This is just the reheating of a continual process of words without action from the Abbott-Turnbull government when it comes to this very important area,” Bowen said.
“The government’s talked the talk about innovation but they’ve done absolutely nothing and now we just see more talk from Prime Minister Turnbull and minister [Kelly] O’Dwyer.
In announcing the plans, Minister for Innovation, Industry and Science Christopher Pyne said equity crowdfunding would “make it easier for Australia’s innovative business to crowdsource the funds they need to develop and grow”.
“Driving innovation across the country is a top priority of the Turnbull government, with crowdsourced equity funding a vital part of any proposed policy changes,” Pyne said.
“Crowdsourced funding has a lot of potential as a new source of finance for innovative Australian companies and will encourage local entrepreneurs.”
The federal government first signalled support for equity crowdfunding as early as December last year, and although it has bipartisan support and the overwhelming backing of the startup community, legislation is yet to be introduced.
“We’ve made it very, very clear that we would work with them to ensure that action could occur urgently,” Bowen said.
“If we’re going to create the jobs of the future we need to have the access to capital to do so and crowdsource equity funding is a very, very good way of doing it.”
A consultation paper was made public in August, recommending a similar model to New Zealand, with a $5 million cap on the money businesses can raise annually, a $2500 limit on investors per campaign and an overall limit of $10,000.
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Denham Sadler is a former editor of StartupSmart. He was previously a journalist at the publication and has worked as a freelancer for the Guardian, the Saturday Paper and the ABC. In his spare time he likes puns and jaffles.
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