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Budget 2021-22: what’s in it for tech?

Budget 2021-22: what’s in it for tech?

A $1 billion digital economy fund, patent and depreciation tax relief and cyber security form bedrock of Treasurer Frydenberg's technology investment.

Australian Parliament in Canberra

Australian Parliament in Canberra

The federal government has handed over a raft of new investment for Australia’s digital services and technology sector as part of its Budget for 2021-2022. 

As previously announced, Treasurer Josh Frydenberg has earmarked $1.2 billion for the government's Digital Economy Strategy and $130.4 million for improved regional connectivity. 

As the technology centrepiece for this year’s Budget, the government announced on 6 May plans to invest half a billion dollars into myGov and the My Health Record system, as well as $54 million into a national artificial intelligence centre, as part of the combined $1.2 billion package. 

However, on 11 May the government handed down the Budget in full, revealing all the detail in its entirety. Key points of this include $10.0 million for the Digital Transformation Agency (DTA), although the agency’s overall budget is down from $425.5 million this financial year to $336 million this year.  

Alongside this, there will be $3.2 million in 2021-22 to extend the Digital Technology Taskforce until 30 June 2022. 

Under the Digital Economy Strategy, the government is developing an Australian Data Strategy to ‘create a data-driven economy through better data use’. The bulk of this will be taken up by the $111.3 million Consumer Data Right rollout. Behind this, $40.2 million will be set aside to deliver the Digital Atlas of Australia, which is aiming to make better use of over 90,000 open datasets. 

Finally, a further $16.5 million is earmarked for a pilot program to make the government's data assets discoverable and support whole-of-economy reuse. 

Tax relief 

Another big-ticket item for the technology industry will be the government's limited patent box scheme, which will offer tax breaks for medical and biotech innovations to boost go-to-market scaling and retain intellectual property in Australia. 

This will see companies’ income derived from patents taxed at a corporate tax rate of 17 per cent, with the concession applying from income years starting on or after 1 July 2022. This will be a reduction from the current rates of 30 per cent for large businesses and 25 per cent for small to medium enterprises.  

Meanwhile, for technology players facing depreciation costs, the new Budget will allow businesses to self-assess the tax-effective lives of eligible intangible depreciating assets, such as patents, registered designs, copyrights and in-house software.  

This measure will apply to assets acquired from 1 July 2023, after the temporary full expensing regime has concluded. 

Communications 

Unsurprisingly, communications and mobile connectivity played a key role in Frydenberg’s budget, with $84.8 million earmarked for improved connectivity in the regions through the Regional Connectivity Program. A tally of $68.5 million has been allocated to a dedicated stream of funding for northern Australia under the Regional Connectivity Program and Mobile Black Spot Program. 

Meanwhile, $16.4 million has been handed over for better mobile connectivity in bushfire-prone areas on the fringes of urban cities. 

“By improving mobile coverage in these areas, communities will be able to receive vital information during emergencies, seek help if needed and stay in touch with loved ones,” Ministers Paul Fletcher and Mark Coulton said in a joint statement.  

“On a day-to-day basis, the program will improve connectivity for these communities, contributing to the local economy through lifting productivity, capability and investment.” 

The Budget will also give $7.7 million to the Australian Competition and Consumer Commission (ACCC)'s  Measuring Broadband Australia (MBA) program for an additional four years.

The program will continue to help consumers select reliable, high-speed fixed-line broadband services that meet their needs, and will extend these benefits to additional regional and emerging market segments by including fixed wireless broadband services

Cyber security 

In terms of cyber security, the big-ticket item is the $43.8 million pledged to expand the Cyber Security Skills Partnership Innovation Fund. According to the government, this will create a pipeline of cyber security professionals that can meet growing demand for cyber jobs across the Australian economy. 

Frydenberg’s Budget is also pledging $18.8 million to pilot a centralised delivery of cyber capabilities and services for government agencies through whole-of-government cyber hubs. 

According to the Budget, costs for this will be partially offset by the Department of Defence, Australian Signals Directorate and Services Australia. 

Meanwhile, $2.8 million will be pumped into “strengthening” Australia's national system of identity settings, alongside $1.8 million two years from 2021-22 to deliver a National Data Security Action Plan, which will be co-designed along with the tech industry. 

From an enterprise standpoint, $6.9 million will be handed over to assist businesses to upgrade their cyber security systems.  

Skills 

As well as skills created under the Cyber Security Skills Partnership, the Budget will also invest $22.6 million over six years from 2021-22 to establish the Next Generation Emerging Technologies Graduates Program, which is said to provide up to 234 scholarships in emerging technologies areas. 

Read more: Cisco supports Australia's FIFA World Cup bid

Meanwhile, the Department of Education, Skills and Employment will receive $69 million to create a new vocational education and training national data asset. 

According to the government, this will boost the “existing capability of the Australian Bureau of Statistics’ multi-agency data integration project”. 

More broadly, a total of $100 million has been allocated to the development of digital skills in the workforce, including the creation of cadetships 

Biosecurity 

The Budget also outlined a raft of investment that has been handed over to technologies delivering biosecurity measures. 

The government intends to modernise biosecurity ICT systems, technology and data analytics with the following allocations: $31.2 million over four years from 2021-22 (and $1.5 million ongoing) to deliver digital capability for biosecurity screening of incoming international mail; $28.7 million over four years from 2021-22 to upgrade the Maritime Arrivals and Reporting System and $19.5 million over two years from 2021-22 to trial pre-border biosecurity screening technology on travellers and air cargo. 


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