Barely 2 weeks into the year

It is barely 2 weeks into the new year and the hands have already come out for government to dole out tax payer monies.  Not for human welfare but for corporate welfare.

Apparently, in their pre-budget submission, the Institute of Public Accountants said:

Australia’s entrepreneurial environment would be strengthened if the government helped promote early-stage venture capital financing to “high-potential young firms”.

Perhaps this is a Machiavellian way for the Institute of Public Accountants to keep its members busy.  You see, the Institute of Public Accountants:

has a passion for small business. More than 75 per cent of our members are either servicing small business or are small businesses in their own right.

an as a rule of thumb, whenever governments meddle in business, they tend to damage much more than help.  This ensures that the businesses not benefiting from government largess are kept small and vulnerable, and thus open to the services of the members of the Institute of Public Accountants.

The IPA submission says:

Young firms in uncertain technological or new knowledge environments are particularly likely to be unattractive to bank providers of debt.

But what they are proposing is in effect public equity financing, but not public as in a voluntary investment by investors in a publicly traded company.  Rather a mandatory investment on behalf of all citizens in a non public not traded company.

But not satisfied with having the accountants gazump them, the Australian Private Equity and Venture Capital Association in its submission:

has called for renewed consideration of government equity co-investment programs, modelled on the government’s biomedical translation fund established in 2015.

There is no better reason for the taxes of Australians to be cut than to starve the government of the ability to engage in such nonsense.

Shut it down.  Give it back.

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10 Responses to Barely 2 weeks into the year

  1. Bruce of Newcastle

    So banks aren’t allowed by APRA to lend to such risky companies because terrible terrible risk, but the taxpayer should fund them?

  2. Like someone else said, what is the point of a new year?

  3. Roger

    Governments ought not be in the business of picking prospective winners in business.

    That is purview of investors.

    There are things governments can do to encourage vital entrepreneurship:

    Cut red & green tape and revise bankruptcy laws to be less punitive in regard to failed but genuine entrepreneurs to encourage them to get back on the horse that threw them.

    This is basic capitalism; that Australian accountants & venture capitalists don’t get it is not only discouraging but disturbing.

  4. Confused Old Misfit

    That really is depressing.

  5. DM OF WA

    The truly depressing thing is that type of thinking is now the norm.

  6. Nerblnob

    I’ve been in SME businesses that thought they would avail themselves of such government “help”.

    Always a waste of time in the long run. It seems like “free money” to some fresh-from-corporate new hire, and somehow he/she drags people who should know better into it . Wild goose chases, blind alleys.

    And trade missions … don’t get me started.

  7. rickw

    Australia’s entrepreneurial environment would be strengthened if the government helped promote early-stage venture capital financing to “high-potential young firms”.

    The entrepreneurial environment would be fixed if:

    – Taxation rates didn’t make the risk almost pointless.
    – Employment regulations didn’t make the risk of hiring unacceptable.

    This is Government attempting to fix a problem they created. As we know, this will end badly and expensively.

  8. W Hogg

    Is this WA Inc without the W?

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