The Herald editorial is rightly damning of the government’s lacklustre approach to science funding:
Public money is about to trickle again into one of the economy’s least cultivated fields for economic growth, science and research.
In a pre-Budget announcement yesterday the Government committed $225 million over the next four years in the hope that good ideas can be turned into high-value innovations for businesses, exports and the economy.
It is a trickle barely replacing last year’s cuts. This ‘increase’ is just three times the annual budget of the John Key Memorial Cycleway. And we all know what a piddling joke that is.
The National-led Government has some ground to make up in this area. Soon after assuming office it turned off Labour’s science funding tap, from which flowed the generous research and development tax credits and the Fast Forward Fund, a long-term $700 million backing for the food and agriculture sectors.
Those programmes involved serious public money and the imperative of the recession, as much as ideological differences over how to spend it, no doubt led to short-term decisions. Since then the Government has announced a Primary Growth Partnership of $190 million but that has yet to develop primary, forestry or food production.
The loss of research and development tax credits has held back small and medium-sized businesses which do not have the capability to commit to R&D on their own.
A crucial difference between Labour and National has always been that Labour invests in the long-term success of the country and National makes short-term wealth grabs for the ruling elite, even at the expense of New Zealand’s future.
In the Great Depression the first National Government raised the school age to 6 to save money rather than make a tiny tax increase on the rich. In the early 1990s recession, they put up the price of tertiary education while cutting taxes to the wealthy. Last year during the economic meltdown they still found half a billion dollars to lavish on the already well-off but cut hundreds of millions from the science budget.
No wonder economic growth under National averages only 75% of what it does under Labour – they refuse to invest in it.
Yesterday’s Government initiative is smaller, too, than National promised in Opposition although it is possible it will claim that with other piecemeal spending on public science the total would be equivalent to its pledge.
Dear God, a broken promise from John Key? Can that be right?
The centrepiece is the $190 million funding for medium to large, research-intensive firms which want to undertake research.
They will apply for taxpayer-funded grants for up to 20 per cent of their research spending but will have the freedom to spend that money where they see fit.
No pre-approved projects or government-vetted inventions. Mr Key thinks they are the “R&D savvy” players and leaving it to them will reduce bureaucracy.
If the money is not enough and too late, then the way it is being delivered is a further problem. National is cutting money to health, social, and environmental funding (what happened to that agricultural emissions research?). It is laying of scientists at the Crown Research Institutes.
Instead, it will give private companies up to 20% of their research costs and let them spend it how they will – no checks, no approvals. It’s what the Nats call a ‘high trust’ model, Whanau Ora for R&D, where the government signs over taxpayer money and hopes that the private company spends it wisely. It creates all kinds of opportunities for rorts and low quality spending.
It is not clear if the private monies involved will all have to be “new” or in addition to current investment.
Oh dear, so taxpayer money could effectively just be a 20% kick back to businesses for doing research they are already doing. It might not lead to any new research at all – and it is being funded by cutting research in other areas.
The latest announcement is like so many made by so many governments over so long. New Zealand needs to lift its investment in public science and private R&D to lift the performance of the economy.
Message received. Now turn on the tap and direct it to the entrepreneurial and innovative so that the country begins to see a return.
Like so much else, in the vital area of R&D the Key Government promises big and fails to deliver.