Major cuts to startup, screen industry, and small business innovation programs are expected in the NSW 2023-2024 budget, as the new Labor government contends with deficits and spending cuts inherited from the Coalition.
Treasurer Daniel Mookhey will release the state budget on Tuesday, marking NSW Labor’s first budget in 13 years, and one the government claims is largely defined by decisions made by its predecessors.
Facing $7 billion in budget pressures, Mookhey this month revealed Labor will not reinstate funding for a swathe of business support programs, which had their funding cut in March by the Coalition government’s pre-election budget update.
Those cuts represent a $118 million hole in the Department of Enterprise, Investment and Trade, according to the Sydney Morning Herald.
Programs set to lose funding in the state budget reportedly include the Sydney Startup Hub, the eleven-floor Wynyard complex housing startup ecosystem leaders like Fishburners and Stone & Chalk, and established industry players like Microsoft and Optus.
Funding for the Small Business Innovation & Research program also hangs in the balance.
The program, launched by the Berejiklian government in 2021, promised $24 million in funding in its first two years for small businesses tackling problems identified by the state.
It sought innovative solutions to issues like the disposal of personal protective equipment, and new ways to accurately count koalas across the state.
But applications were paused earlier this year as the state government undertook its comprehensive expenditure review, with final decisions made under the program reliant on the outcome of the 2023-2023 budget.
That pause also hit the MVP (Minimum Viable Product) Venture program, a move that surprised applicants and supporters in the early-stage startup scene.
Cuts are also expected to hit the Made in NSW incentive program, designed to entice global film and TV giants to launch productions in NSW, and to the Post, Digital & Visual Effects tax rebate.
“Current applications will not be progressed at this time,” Screen NSW said after the cuts were revealed.
Those funding decisions are set to have a significant effect on independent firms working in the multi-billion dollar screen industry, said Erin Madeley, chief executive of the Media, Entertainment & Arts Alliance.
“These cuts will have devastating consequences for the NSW screen industry, jeopardising the state’s ability to attract productions and putting at risk thousands of jobs and small businesses,” Madeley said on Friday.
Beyond those foreshadowed cuts, the budget will serve as a proving ground for elements of Labor’s pre-election platform that are yet to become reality.
Leading into the March election, Labor pledged to establish a Small Business Bureau, an advisory body helping small businesses navigate regulatory requirements, cut through red tape, and offer their goods and services overseas.
The party also claimed it would create a dedicated charter for small business, codifying how the NSW government ought to deal with SMEs.
Both the Small Business Bureau and charter would be accomplished with existing resources and headcount, according to election promise costing documents.
A broader rundown of Labor’s pre-election promises can be found here.
Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
