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Primary sector research and the knowledge economy

Hon Pete Hodgson
Monday, 18 September 2000 Speech Notes

Unitech, Carrington Rd, Auckland.

Growth science: primary sector research and the knowledge economy

(Address to a combined meeting of the New Zealand Institute of Agricultural Science and the New Zealand Society for Horticultural Science)

Thank you for the invitation to speak tonight.

It's a pleasure to be among scientists. I'm always inspired and amazed when I visit research centres in this country and learn about the work going on. I'm always impressed by the quality of the scientists. And I'm always impressed by the commitment so many of you have to staying here and contributing to this nation's future.

I want to assure you that, at last, you have a Government that is on the side of science. We understand that science and technology are crucial to our economic future. We're committed to strengthening the country's innovation system, so it can support the high-skill, high-wage, high-quality economy that we need to sustain our standard of living.

Your organisations have a direct interest in primary sector research. So tonight I'm going to canvas some issues in agricultural and horticultural research, as well as the broader issues for New Zealand science. I know some of my comments will raise questions, and I hope I can answer some of them at the end of my address.

Starting at the top, I want you to know that this Government is committed to the transformation the New Zealand economy.

Transformation means moving New Zealand beyond its traditional dependence on the primary industries for the generation of wealth. We are extremely good at primary production and processing. It is a vital part of our future and we continue to post remarkable productivity increases.

But it is not enough.

Wealth is increasingly taking the form of knowledge rather than stuff. We need to build on our strength in primary production, producing ever more sophisticated goods and services. Much of that growth will come from the commercial application of research and technology.

As Minister of Research, Science and Technology I have made a commitment to lift our public investment in research and development to 0.8% of GDP by the year 2010. We made a start in this year's Budget by increasing the total investment by about 10 percent.

There are three priorities for this investment:

First, we need greater levels of private sector involvement in research and development.

Second, I want to unleash the creativity and imagination of researchers by better supporting basic research.

Third, I want to ensure that the range of activities undertaken in the strategic research area is maintained and in some areas increased.

The common factor in these three priorities is you and your colleagues - researchers, technologists, innovators and entrepreneurs. New Zealand's future as a quality, knowledge-intensive economy hinges on your skills.

The increased funding for science in the Budget took total expenditure on Vote RS&T to $474 million. That's $43.6 million more than last year. So we've reversed the decline of recent years.

But another important difference about this year's science budget is that it has been split up differently. To put it crudely, there are now more buckets of money for different types of research.

Some of you will have followed the progress of the Foresight Project that produced this change. You might in fact have found it hard to follow, and I wouldn't blame you.

One of the outcomes of Foresight was the New Economy Research Fund.

Looking at the outcome of the first round of grants from the New Economy Research Fund, you could be forgiven for thinking that primary production sector research was playing Cinderella. Medical, biotech, infotech and new manufacturing research predominated.

But make no mistake: food and fibre research is still a high priority for Government funding.

The primary industries are not part of an "old economy" on which the sun must inevitably set. The economic transformation we seek will be based in significant part on the value we add through research, technology and innovation to our primary produce.

A key to our success is seeing more of our produce elaborately transformed and commanding consistently high prices. Considerable value is also generated by the designers of equipment and services for our agricultural industries.

This year Government is spending a total of $116m on public good research on food and fibre through the Foundation for Research, Science and Technology.

The thick end of this, about a third, goes into animal research. Wood, fruit, and biotechnology together account for almost half. Vegetable, seafood arable and sustainability research make up the rest.

I'm pointing out that primary sector research is still a large part of the Government science budget, but in doing so I'm trying not to slip back into the mentality that says the volume of money is all that matters.

No particular sector of the research community should get share of public funding simply by fact of its existence, and according to the size of the sector's contribution to GDP.

Quality is what matters. Quality, and the degree to which the research contributes to strategic goals – economic, social and environmental.

There are some fantastic examples around of the kind of research that is taking New Zealand towards the knowledge-based society we seek. Many of them are in the primary sector.

Genomics is an area of huge potential, as are proteomics and bioinformatics.

As you know, some in our community see genetic modification as a threat, while others see opportunity. It's an issue where science has outstripped society's understanding, and the moral and ethical framework around it.

New Zealand needs an informed debate on GM, which is why the Government has established a Royal Commission. The most important aspect of their report will be to identify the strategic options available to New Zealand.

This debate should have taken place a long time ago, of course, but we are not alone among nations in fronting up late. In fact we're ahead of most in doing so.

I'm sure some of you here tonight are using molecular biological techniques as important tools in your daily research. Some of you may be involved with work on GM plants and animals.

I hope that all of you are engaged with the Royal Commission process, either as individuals, with your institution, or as part of your professional society.

Genomics is already revolutionising conventional breeding. It can speed up the development of new varieties by an order of magnitude.

In the last year HortResearch has refocused much of its molecular biology research on a major new plant genomics initiative. It now has a rapidly growing gene database and a stand-alone bioinformatics programme to process the gigabytes of information that genomics research produces.

HortResearch scientists are now focussed on identifying new high-value genes. It already has a rapidly growing database of genes and gene markers for apples and kiwifruit, two of our most valuable horticultural crops.

AgResearch too has not been slow out of the blocks with its studies of sheep genomics.

I was delighted with the news of the recent discovery of the Inverdale gene for twinning. Its discovery will have impacts both on the farm and far beyond.

It is being bred into other sheep breeds. But research in Finland has identified the Inverdale gene in mice, rats and humans. The implications for human fertility treatments could be huge.

It's a story of serendipity and sound science. It is also a good example of taking agricultural research those further steps into the innovative thinking needed for the knowledge society.

One more example.

The success of the Zespri Gold kiwifruit is another case of smart research followed by smart marketing. It means New Zealand benefits from the gold kiwifruit we grow here and the gold kiwifruit grown under licence overseas. It seems a long way from the "Hort 16A" seedling identified in 1991 to the hundreds of thousands of trays of the fruit that are now being marketed in Europe.

But an institution like HortResearch can't rest on its laurels with the success of Zespri Gold. Scientists need to get the next new and enticing kiwifruit variety grafted into commercial orchards before the gold fruit has saturated northern hemisphere markets.

I know that Hort is testing varieties of a close relative of the traditional "Hayward" kiwifruit. These produce small, tasty and hairless fruit that can be eaten whole. Maybe one of them is the next golden fruit, in which case New Zealand will still be ahead of the game. That's what innovation is about.

Traditional agricultural and horticultural science will always be relevant. Even with the fanciest molecular biology in the world we still need to know how new crops will grow in different soil types, different climates and latitudes. We need to know how they will respond to different pests and management regimes.

Some of you will know a lot more than me about some of the examples I've mentioned, and that's fine. I just offer them as instances of researchers taking a step beyond traditional agricultural and horticultural research and breaking into the development of new products, processes and linkages.

I'll close with a general observation about funding of a particular research area over time.

When research begins in a new area the funding levels are likely to rise progressively, as base data is collected and research questions are answered. The likely end result of this research in agriculture and horticulture is that a new variety, breed, product or process will be taken up and used by farmers, orchardists, industry or exporters.

At this stage, two things happen.

Firstly the basic product or process research has been done and the new research needs often shift to fine tuning.

Secondly the commercialisation of the research results means its commercial users can help pay for further work. So direct Government support for "mature" areas of research can reduce over time – and that represents success, not the abandonment of responsibility.

I hope I've given you some food for thought. Science always gives me some. So do scientists' questions, and I expect you have a few.

Thank you.


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