Allowances for start-ups are more generous in Britain than they are in Australia, says inventor James Dyson.
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The Gillard government is being “mean” in robbing big companies from research and development funding in order to help smaller manufacturers, says billionaire Sir James Dyson.
Dyson, who is best known for inventing the bag-less vacuums, is valued by Forbes Magazine as having a net worth of $US4.2 billion (as of March last year).
He’s in Australia this week to launch and promote the “Airblade Tap” – a combined water tap/hand dryer.
It follows last year’s futuristic bladeless fan called the “Air Multiplier”, which has also been a popular product for the company, so much so that Dyson has spent much of the past year fighting in courts against Chinese rip-offs of the product.
The 66-year-old British entrepreneur believes it’s of utmost importance that courts uphold patents on products. He frequently calls on the UK government to do more to protect and encourage innovation, as well as to attract more students to engineering and science fields.
Dyson says the Gillard government’s announcement to cut $1 billion in funding for big companies undertaking research and development and instead channel it to smaller manufacturers struggling under the high Australian dollar isn’t a good idea.
Local business groups aren’t happy, saying large-scale undertakings on R&D will be jeopardised and so too will be the ability to track down scientists and engineers who are often recruited through such projects.
Dyson says the government shouldn’t “pick winners” in business. “Winners come from the most unlikely areas,” he says in an interview with BRW.
“I think it’s wrong to take from one company to fund another company. It’s going to be a disincentive [for] big companies who can be just as good on patent technologies. All sized companies should be able to do R&D and that’s [possible] through very large tax breaks.”
Dyson says the UK government is far more generous than Australia in giving R&D grants. He says rather than cut funding, the Australian government needs to increase tax breaks as well as encourage angel investors to invest in start-ups.
“Start-up companies in Australia investing $1 million, can claim $450,000 [under R&D tax breaks] but in Britain start-ups spending $1 million get $1.2 million back,” he says. “That not only helps tech start-ups fund future investments but also encourages angel investors to invest in start-ups.”
The Gillard government also wants to create innovation precincts. Some in business are against it, saying investment should occur naturally, as was the case with Silicon Valley, rather than be forced in a particular area.
Dyson says having innovation precincts is “complex”. The James Dyson Foundation often runs programs for young designers and engineers to encourage British invention. Dyson says local universities should receive greater funding for innovation, but that such moves could also be backed by business.