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Joyce: First National Science Strategy launch

Steven Joyce

5 OCTOBER, 2015

First National Science Strategy launched

Thank you for joining me here today as I launch the Government’s first ever National Statement of Science Investment.

I’d like to acknowledge those who took the time to make a submission on the draft National Statement of Science Investment when it was published last year.

The final NSSI responds to feedback on the Draft that asked for a document more focused on the future and with a more comprehensive plan for science in New Zealand.

This morning I will take you through the key themes of the final NSSI, as well as outline a few changes that will be happening within the science system.

New Zealand has a proud history of innovation. All of our forebears, from wherever they came, had to be innovators to survive and thrive. Our remote physical location ensured that. Our earliest inhabitants couldn’t just pop back home to pick up something they hadn’t brought with them. They had to make it again, or develop it for the first time.

Our small size and remote location has ensured that innovation remained at the forefront as our society developed. I don’t believe it is any accident that some of the world’s great scientists have come from New Zealand.

Our location and our size breeds a questioning, can-do approach that focuses on thinking, not whether we have enough resources to do a job.

As a result our companies and our science teams achieve things that always surprise those from much bigger countries. That innovation heritage is our past and our present but also our future.

For New Zealand to succeed through the middle of this 21st century, we know we must engage and be open with the world: get out there and sell our ideas, our processes, our innovative products and services on the world stage.

That means keeping innovation at the heart of what we do. That means having a strongest possible science and innovation system that helps us punch above our weight and compete and succeed in the wider world.

Which is why we need a plan for how we’re going to work with research providers and end users including businesses, government agencies and communities to make sure New Zealand is getting the best possible results from our investments.

The National Statement of Science Investment is our mechanism through which to do this. It sets the strategic direction for government investment in New Zealand’s science system for the next 10 years.

It responds to the need to target our growing science investments effectively and leverage them to maximise their long-term value to New Zealand.

We have identified that by 2025, we want to see a better-performing science system that is larger, more agile and more responsive.

We want to grow business expenditure on research and development to well above 1 per cent of GDP, making a thriving independent research sector a major pillar of our science system.

We want to continue promoting New Zealand’s standing as a high-quality R&D destination, resulting in attraction and retention of talented scientists and continued investment by multinational companies.

We also want to reduce complexity and increase transparency in the public science system and continue to build on our evaluation and monitoring of performance, underpinned by reliable data to track progress against our goals.

A notable feature of the NSSI is the focus on two pillars of success: excellence and impact.

The Government’s science investments should be subject to a rigorous test for quality of the science undertaken, and all our science should have a clear line of sight to the eventual benefits for individuals, businesses or society.

The Government’s investment in science has grown very substantially, by 70 per cent between 2007/08 and 2015/16, with our total investment in science currently more than $1.5 billion per year.

We have made a commitment to grow our investment in science further to 0.8 per cent of GDP and include more ideas-led discovery research, which is likely to generate substantial long-term benefits for New Zealand.

With that increased investment comes the need for greater accountability. This drive for accountability is not unique to the science system. It’s the same accountability that we are now seeking for all areas of taxpayer expenditure. It’s the sort of accountability that gives the Cabinet confidence to invest more in the science system.

One of the most important initiatives in the NSSI is the introduction of an annual Science and Innovation System Performance Report, and a comprehensive, sector-wide evaluation, monitoring and reporting system.

It is not always possible or even much of the time possible to work out where a particular piece of scientific endeavour will take us. However it is possible to work out scientifically which funds and mechanisms are helping to strengthen the science system overall.

Regular, comprehensive, sector-wide evaluation of how different parts of our science system are succeeding will help us move beyond our own subjective views of what should be funded next to, dare I say it, a more science-based approach to funding our science system.

We have also identified that creating a more prosperous New Zealand economy requires focusing our investment towards sectors in which we can achieve big gains from productivity improvements.

For our manufacturing sector, this means we’ll be encouraging business R&D to grow more quickly, through incentives such as the Callaghan Innovation growth grants. We will also continue to increase our government investment in further-from-market research, including through the National Science Challenge for Technological Innovation, to support the long-term growth of the sector.

For health research, we will seek to increase funding to this high-performing sector over time, while also considering how to leverage the results for greater economic benefit. That’s the subject of the current strategic refresh of the Health Research Council.

In terms of ICT, we will be looking to increase the academic strength of the sector. We will support the long-term growth of the ICT sector by strengthening our public base of far-from-market discovery research.

With the primary sector, Government expenditure is already responsible for a significant proportion of R&D. We will be seeking to incentivise further industry investment while focusing further Government investment on high-quality discovery research.

We will also be focusing on the agri-technology space. I am expecting precision agriculture to be a major area of opportunity for improving agricultural productivity while achieving our environmental objectives in the years ahead.

The Government is also the main investor in environment research. Significant continued investment here is justified where the public is the main beneficiary.

There has been a bit of debate recently about the place of so-called blue skies research versus applied research, and the “correct” balance between the two.

The National Statement of Science Investment addresses this issue in its description of the different “horizons” of research and breaks investment down into business-led science (the close-to-market or technology transfer-type science), mission-led science, and investigator-led – or discovery science, which addresses the longer-term horizon.

The Government recognises the importance of all three of these horizons in delivering a balanced and effective science system, and has lifted the investment across all three areas of research.

Our main investigator-led science tools are the Performance-Based Research Fund, the Centres of Research Excellence programme, and the Marsden Fund.

Since 2008, we have increased the funding across these three programmes by 36% percent.

Discovery research is the least likely to be funded by private funders, because of the long and uncertain lead times for commercialisation of the research. Government is very conscious of its role in this space.

Discovery research also tends to be concentrated in the university sector, which efficiently combines the two important roles of both conducting research and training the next generation of researchers.

We will continue to see some blue skies research being conducted in the CRIs and private sector institutes, but primarily in areas of interest to their industry partners, and to inform their more applied work.

In the mission-led research space, one of the big innovations over the last few years has been the development and launch of the National Science Challenges programme.

Modelled on the successful CoRes programme and international Challenge programmes, these cross-disciplinary scientist-led programmes are designed to tackle the biggest science-based challenges New Zealand has, and they have strengthened the Government’s investment in long-term, strategic research and capability.

They are partnered in the mission-led science area by MBI’s contestable science fund and, as signalled in the draft NSSI, MBIE’s contestable fund has now been redesigned to allow for a more simplified and flexible approach that is focused on areas of future value, growth and critical need for New Zealand.

As such, the contestable fund will remain one of the Government’s main mission-led investments.

The changes to the contestable fund resulting from the review are:

o A single, larger, more agile fund that can respond to emerging opportunities;
o Two investment mechanisms, with funding offered through an annual call for proposals for either short-term, fail-fast projects or large-scale, medium-term research projects;
o An Investment Plan that will communicate how, when and why the Government will invest over a three-year horizon; and
o Streamlined, robust operational processes that will reduce complexity and cost.
These changes will begin to be implemented through the 2016 investment round. More information will be made available in the coming weeks with the publication of the Investment Plan and request for proposals.

I encourage you to engage with MBIE as it implements the revised funding process.

We continue to have a very strong focus on Business R&D in the NSSI, which references a range of actions to lift business R&D to 1 per cent of GDP.

Increasing business R&D is of critical importance to New Zealand. We want to see the science system grow, with much of that growth being driven by private investment.

We have already done much to support industry to increase its investment in R&D, including funding business R&D grants and a new programme of work to attract investment by multinational firms.

We are also establishing Regional Research Institutes to leverage private investment in the regions.

Tomorrow, Minister Amy Adams and I will be releasing the Innovation Chapter of the Business Growth Agenda, which will cover our work in this area in more detail.

International science linkages are hugely important to New Zealand. Our small size means we will only ever be responsible for a very small percentage of the world’s total scientific endeavour (currently about 0.6% of total world science).

And yet, because of our unique DNA of innovation, we create some of the most innovative scientists in the world.

Our job as a country is to extend our reach, our influence, and our budget by creating strong and strategic linkages with far bigger science systems, and collaborating together to achieve great science.

I have been concerned for some time that our investment in international relationships has been too ad hoc, too reactionary, too fragmented and, frankly, too small to be truly effective either for the science sector or for New Zealand’s wider engagement with our international partners.

Therefore the National Statement of Science Investment identifies two projects to change that approach.

First, we are reorganising the Ministry of Business, Innovation and Employment’s International Relationship Fund to be a more transparent and straightforward fund that better supports high-quality international science collaborations for New Zealand.

The Fund supports specific bilateral and multilateral strategic science and innovation collaboration between New Zealand and its international partners, with about $9.3 million invested per annum.

The new fund, which will be called The Catalyst Fund, will consist of four funding streams that target investment in leadership, international influence, seeding new relations and strategic co-operation with key research partners.

Many existing programmes and activities under the International Relationships Fund will continue to be supported by The Catalyst Fund – either directly or through an open call for applications – and I encourage you to work with MBIE, the Royal Society of New Zealand and the Health Research Council, who administer the funding.

The implementation of The Catalyst Fund will be supported by the second project listed in the NSSI, the development of a new co-ordinated cross-government International Science Strategy.

The development of this strategy, a first, is crucial to ensure our agencies, our science organisations and our scientists can leverage effectively off each others’ efforts and avoid a scattergun approach to international science engagement.

Taken together, these two initiatives will give the Government much greater confidence in its investment in international science linkages, and that confidence will help us invest more in this important area in the future.

Science and innovation are of increasing importance to New Zealand, with our future prosperity reliant upon the creation and adoption of new ideas, products and services.

As a country, we need to balance our investment in applied science with more future-focused research that will challenge existing approaches and grow new, knowledge-intensive enterprises and industries.

The NSSI sets out how we are creating a more flexible and responsive system that will adapt to change.

We have made it clear that the Government will support businesses in increasing their investment in R&D while also seeking to increase public investment in transformative, ideas-led, discovery research, where the role for direct government investment is most clear.

I encourage you to take a detailed look at the NSSI and consider the opportunity it presents to set the future direction of the New Zealand science system.

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