2. Dr ASHRAF CHOUDHARY (Labour) Link to this
to the Minister of Research, Science and Technology
How is the Government’s research funding contributing to sustainability and economic transformation?
Hon STEVE MAHAREY (Minister of Research, Science and Technology) Link to this
This morning the Foundation for Research, Science and Technology announced the results of its biggest research investment in 4 years, involving $628 million in total contracts over the next 8 years. This will target key priorities, with $150 million to investigate how to promote sustainability and to respond to climate change and $311 million to boost the primary sector. All this research is designed to transform the New Zealand economy.
Dr Ashraf Choudhary Link to this
Has he received any reports on the international competitiveness of the research and development credits announced in Budget 2007?
Hon STEVE MAHAREY Link to this
The research and development tax credit was a $630 million investment made in an effort to encourage the private sector itself to invest in research, and the response from overseas has been very positive. I report, for example, that Deloitte’s Australian research and development tax expert Serg Duchini said that, all things being equal, it definitely increases the attractiveness of undertaking research and development in New Zealand over Australia, and David Gelb of KPMG in Australia has stated: “There are companies which in the past have relocated R and D facilities from New Zealand to Australia. This may well reverse that trend.” I think the research and development tax credit has been extremely well received.
Hon Brian Donnelly Link to this
Can the Minister confirm that biotechnology, upon which the Government is pinning some of its hopes for economic transformation, has not shown returns on investment internationally at this point in time?
Hon STEVE MAHAREY Link to this
Not just this Government but many Governments have identified biotechnology as the future of science. Of course, in a biologically based economy one would expect us to be investing in that area. Therefore, for example, the member might be encouraged by the fact that one of the contracts signed in the biotechnology sector in New Zealand last year was the sixth biggest contract around biotechnology in the world last year. So we are now beginning to see the chain of investment come to fruition.
Hon Brian Donnelly Link to this
I raise a point of order, Madam Speaker. The question I asked was about whether biotechnology has shown returns on investment internationally. The Minister did not approach that question, at all.
Madam SPEAKERI thought that the Minister had addressed it, but if he wishes to address the international aspect of it, he may.
Hon STEVE MAHAREY Link to this
If I understand the question correctly, the example I chose was an American co-investment with us that resulted in it being the sixth largest in the world last year. So internationally we are beginning to see our biotechnology begin to get investment of the kind that we are after.