New Program for Commercialising Research
Monday 30 November 2009
By Sam Facy
Accru Harris Orchard
In the May 2009 Budget, the Government announced their intention to establish a radical new program for commercialising research, 'Commercialisation Australia', (formerly known as the Commonwealth Commercialisation Institute.) Further information on the program was announced on 21 October 2009 by Senator Kim Carr, Minister for Innovation, Industry, Science and Research.
Senator Carr said “The radical new program for commercialising research will take a completely new approach to innovation assistance. It will tailor assistance to the applicant’s needs, not fit the applicant to the program. Commercialisation Australia is specifically designed to boost early stage commercialisation by leveraging private sector capital and expertise.”
Small to medium sized businesses looking to improve their competitiveness or reduce their impact on climate change through investing in technology and innovation are likely to be the main beneficiaries. The details announced so far are outlined below.
Funding Levels
Successful applicants to the Commercialisation Australia program will have access to three streams of funding:
- Building skills and knowledge - funding of up to $50,000 will be available to engage specialist services to commercialise new ideas through building skills, knowledge and networks.
- Funding to realise proof of concept - competitive grants up to $250,000 will be available to assist with testing the technical and/or commercial viability of a business model, process, service or product idea.
- Leveraging early stage commercialisation - funding will be available from $250,000 to $2 million to enable a new product, process or service to be developed for market. These grants will be repayable upon the success of the project.
Many people believe that the Commercialisation Australia program represents the much anticipated replacement to the highly successful Commercial Ready Grants program of AusIndustry (scrapped in 2008). However, it would appear the Commercialisation Australia programs are more of an extension to the COMET program (Commercialisation of Emerging Technology) than a replacement to the Commercial Ready Grants program.
At this early stage, some prospective applicants seem concerned with the notion of “repayable grants” proposed as part of the Early Stage Commercialisation funding stream. This should not be cause for concern. The Commercial Ready Grants program replaced the R&D Start Grant and Loan program, which provided grants for R&D and proof of concept and concessional loans for early stage commercialisation. The loans worked as 5-year loans where repayments and interest accrued 18 months after the end of a project but where interest was calculated at 50% of the Commonwealth Bank index rate meaning this money was very inexpensive.
What does the new program mean for your business?
Winning incentives and assistance can make a significant contribution to business performance and many businesses are able to radically improve their bottom line with this additional support. Government incentives can also provide your business with an opportunity to improve competitiveness or reduce its carbon footprint through investing in technology and innovation.
While the fine detail of the funding has yet to be announced, the new program appears to offer valuable incentives to businesses which will attract significant demand. It is encouraging to note that the competitive grant and incentive environment is certainly going to be bolstered in 2010.
There are billions of dollars annually made available to Australian business through assistance and incentives – it’s Accru’s job to make sure our clients get their slice of the action. Please contact your local Accru advisor if you would like assistance or advice in this area.
