Federal budget falls short on driving an inclusive economic recovery
While Impact Investing Australia (IIA) acknowledges the federal budget’s support for disadvantaged Australians, it says the Government has missed the opportunity to drive positive and inclusive economic growth that will help address the significant social and environmental challenges we face.
Australia’s peak body for impact investing welcomes the planned payments to states/territories for social impact investment trials for vulnerable priority groups ($3.2 million) and youth at risk of homelessness ($3.2 million). It also says the increase in the Government guaranteed liability cap of the National Housing and Finance Investment Corporation (NHFIC) by $2.0 billion to $5.5 billion will enable the NHFIC to support the provision of more social and affordable housing.
However, IIA says with no new, definitive impact investing measures included in the budget, the Government has missed the mark on better leveraging private sector capital to drive an inclusive economic recovery – one that it is resilient to future shocks, drives job creation and re-balances the labour market to provide more opportunities for Australians and regions that need it most.
Impact investing aims to generate positive, measurable social and environmental impact alongside financial returns, with the market providing capital to address global challenges (such as sustainable agriculture, renewable energy, microfinance and affordable housing, healthcare, and education).
“Government action would help the impact investing market contribute even more so towards rebuilding our economy following the effects the pandemic and recent natural disasters has had, particularly on vulnerable Australians,” IIA Chair, Richard Brandweiner said.
“Catalysing the investment of private and institutional capital into solving entrenched social disadvantage is more important than ever, and we will continue to encourage the Government to play a key role in enabling this.”
Investors, businesses and community organisations informed a range of recommended actions for the Government to take, through its Social Impact Investment Taskforce led by an Expert Panel comprising four IIA Board members. In 2019, the Australian Government funded the Taskforce to identify additional solutions to address entrenched disadvantage, achieve measurable social impact and facilitate private capital investment in the social impact investing market. While the Government received the final report and recommendations of the Taskforce in late 2020, it is yet to provide a response.
The Taskforce’s interim report recommendations included the Government co-financing an impact investment wholesale fund to catalyse and scale for-purpose solutions; and setting up a social enterprise growth fund in order to develop a pipeline of businesses tackling social and environmental issues.
“Impact investments will be accelerated and our economy will be transformed to better serve all Australians, with funding for the Taskforce recommendations,” Mr Brandweiner concluded.
About Impact Investing Australia (IIA)
IIA is growing the market for investments that deliver measurable social and environmental benefits alongside financial returns. Our vision is that every dollar invested builds a better world. We are a member of the Global Steering Group for Impact Investment and work closely with its 33 member countries.
Media contact: Patrice Virlombier, 0425 724 769, email@example.com