Audit flags errors at Commercialisation Australia

Government grant program for startups set to close at end of year

Commercialisation Australia CEO Doron Ben-Meir

Commercialisation Australia CEO Doron Ben-Meir

The Department of Industry's administration of Commercialisation Australia has received a mixed review from the Australian National Audit Office ahead of the grant program’s demise.

In its 2014-15 budget, the Coalition Government announced the end of Commercialisation Australia (CA), a $213 million grants program for startups. Pending the conclusion of the budget process, CA will close its doors at the end of this calendar year.

“Overall, the effectiveness of the department’s administration of the CA Program has been mixed,” the ANAO said in an audit released this week.

ANAO said the department effectively administered CA's four original grant components, but made financial errors with a fifth component – a pilot program – in 2011.

“The Pilot Program’s design, which made provision for the department to apply for a Commonwealth grant, and the department’s decision to apply for grant funding, demonstrated a lack of understanding of the Australian Government’s financial management framework, resulting in the department granting financial assistance of $500,000 to itself.”

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This “created a situation where departmental officials had a conflict of roles; with potential implications for the equitable treatment of external applicants,” the ANAO said.

Still, applicants to CA generally liked the program, the audit office said.

“Program participants indicated satisfaction with the wider program, including unsuccessful applicants who considered that their company was better positioned for commercialisation following the application process, due to the quality of support and feedback provided by departmental case managers as part of the application assessment phase.”

Startups have criticised the demolition of CA.

StartupAus, a group formed by Google and several big players in Australia's startup scene to advocate for Australian tech startups, has said that the “abolition of Commercialisation Australia removes a vital lifeline for local startups and much needed support for angel investment.”

Ingogo founder Hamish Petrie has said the program “filled a funding void at a critical stage of the businesses development and corrects a fundamental flaw with pure market economics.”

“There was nothing wrong with it, it wasn't broken and was performing a very important role.”

Adam Bender covers startup and business tech issues for Techworld and is the author of dystopian sci-fi novels We, The Watched and Divided We Fall. Follow him on Twitter: @WatchAdam

Follow Techworld Australia on Twitter: @Techworld_AU

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Tags Australian National Audit Office (ANAO)budgetstartupsCommercialisation Australiagovernmentaudits

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