Legislation to establish the Labor government’s $15 billion National Reconstruction Fund (NRF) is set to become law after passing in the Senate, setting the stage for forward-thinking startups and manufacturers to secure significant financial backing.
The NRF, long championed by the federal government, is expected to provide loans, equity agreements, and other forms of finance to companies advancing Australia’s high-tech, high-growth capabilities.
It will target seven key areas, the federal government says, reflecting Australia’s existing strengths and potential opportunities.
These include:
Some $8 billion has already been earmarked, with the federal government intending to invest $3 billion in renewables and green technology, $1.5 billion for medical manufacturing, and $1 billion for efforts to ‘value-add’ the nation’s resources industry, among other high-priority fields.
An independent board is set to determine which businesses receive that investment.
The bill will return to the Lower House for a final-sign off on amendments raised in the Senate.
The NRF is a key pillar in the federal government’s industrial strategy, and is set to become one of the “largest peacetime investments in Australian manufacturing capability,” Minister for Science and Industry Ed Husic said after the Upper House accepted the bill.
“The most successful modern economies are built on strong, advanced manufacturing capability,” Husic added.
“The NRF will help deliver this for Australia.”
The bill establishing the fund has been welcomed by some leaders in Australian technology.
The NRF “could and should be a catalyst for nation-building,” said Kylie Walker, CEO of the Australian Academy of Technology and Engineering.
“We have the technology.”
The bill did not pass without some dispute, however.
The NRF will “take $15 billion of taxpayers’ money to fund projects that are unsustainable in a funding model that is plagued with issues,” claimed Liberal Senator Paul Scarr.
“Next time you come to Canberra, you’ll see a long queue of rent-seekers coming up to Parliament House, seeking equity, capital and loans from the government to fund their projects.”
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.
