Science funding changes to strengthen research capabilities

Research, Science and Technology Minister Pete Hodgson has announced changes to the science funding system that will provide more stable long-term funding to maintain key research capabilities.

"A little over a year ago I began consulting the science sector about how to strengthen New Zealand's science system, including by looking for more stable ways to fund capability," Mr Hodgson said today.

"Public funding for research in New Zealand is highly contestable, which means researchers bid competitively for funding from the Foundation for Research, Science and Technology. "Contestable funding enables changes in the Government's investment priorities to be implemented quickly and gives new research providers access to funding. However the lack of long-term certainty over funding can also undermine core capability in the science system, even as the Government's investment in research continues to grow strongly.

"People in the science sector have been expressing concern about their ability to develop and maintain particular research capabilities, of strategic value to New Zealand, when faced with this uncertainty. They have also said it is harder to recruit and retain top researchers, who build the research teams driving the most productive science.

"In response to these issues I am making changes to the funding system that will include a progressive increase in institutional funding, initially for Crown Research Institutes. This funding will increase the ability of CRIs to make independent decisions about maintaining capacity in research areas where the Foundation is unable to support funding bids. It will also allow more independent decisions about the development of new areas of capability."

Institutional funding, currently known as "non-specific output funding", amounts to $28.5 million – or 5 percent – of the total $556.9 million in Vote Research, Science and Technology for 2003-04.

"I intend to increase this funding progressively over the next several years” Mr Hodgson said. "Details of the first stage of this new funding will be announced in this year's Budget."

Initially only CRIs will be eligible for the new funding, as they are critically reliant on FRST funding and have fewer alternative funding sources than tertiary institutions. In the longer term, if funding permits, other institutions such as research associations could benefit.

"In addition to the funding changes, the Foundation will trial a new mixed funding system in the coming year," Mr Hodgson said. "This will see funding in some areas of research made over to the institution best able to achieve the outcomes sought, rather than tied to specific research projects. The opportunity to put forward proposals to receive funds based on outcome performance would be open to all institutions. A substantial amount of funding will, however, remain fully contestable, particularly in rapidly developing areas of science.

"In sum, these changes represent an adjustment rather than an abandonment of contestable funding. The aim is to retain the benefits of contestability while increasing the ability of CRIs, in particular, to weather changes in the Foundation's funding priorities and maintain or build strategically valuable research capabilities.

"Science and technology is a long-term business and our research organisations need to be able to position themselves to deliver on tomorrow’s needs as well as today’s. This requires forward-looking high-quality science, effective long-term relationships with industry and other science users, and more stable career paths for talented scientists. The provision of more stable funding for research capability will help achieve these things and sustain the flow of new ideas, new knowledge and innovation."

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