Maharey Steve: Debate on Crown Entities Public Organisations  and State Enterprises — In Committee 
Maharey Steve: Debate on Crown Entities Public Organisations  and State Enterprises — In Committee 
[Volume:631;Page:3053] 
Hon STEVE MAHAREY (Minister of Research Science and Technology) 
: 
 I will just take a short call on the Foundation for Research Science and Technology as well. First of all I thank the member for his support of the area of science. Science is one of the things that has traditionally received bipartisan—or multipartisan these days—support in this Chamber. But I think that one of the challenges we all have in front of us is to get the message across to New Zealanders—who in general say in surveys that they support science and scientists—that more than support is required. We actually have to apply the knowledge we are producing in this country. If we are keen on making the kind of transformation we are interested in making then it is not just about knowledge being around the place. It is about ensuring that in small businesses in families or in local councils wherever it might be people are making science work for them. That is what we are after these days. 
As the member pointed out one of the things the foundation has been doing this year to try to advance that goal has been to change its behaviour. It has done that in two ways which I will just touch on. One is that we are still working hard on the area of priorities for science. We are a small country; we have 4-point-something million people. We want a wide-ranging commitment to science but of course we do not produce a huge amount of science ourselves in the general scheme of things. Many other countries around the world are interested in this area as well and those countries are producing a great deal of science. We are a small player. 
The key issue for us is whether we are world leaders on the issues that matter most to New Zealand’s development. We have obviously benefited over the years from investment in things like pastoral science. We need to identify what we want to invest in for this century. The foundation has been helping to work on that idea along with the Ministry of Research Science and Technology and it has been talking with people about how it intends to do that. 
That has resulted in the second point I want to raise which is a discussion the foundation has been having with the sector about longer-term funding. It is clear to all people in the Chamber that although there may have been major benefits from Crown research institute reforms in the early 1990s time moves on. The kinds of benefits one gets from that shake-up therefore tend to dissipate. As we go into this century—as the OECD warned us when it came through recently—it is time to rethink the model. We have been doing that and one of the signs of that is we are seeking to have a longer-term funding model for a good deal of science. 
That funding model takes us back to one of the questions raised by the previous speaker Brian Donnelly about how we will retain scientists if their science is being refunded only every 6 months or 1 year—it is very hard to do. It is very hard to persuade young scientists to travel around the world to be a scientist here after getting a PhD somewhere if an American company invites them to America for a 20-year contract while we invite them to a Crown research institute in New Zealand for a 3-year contract. That does not add up for scientists in terms of their career. So the foundation has begun a discussion on the back of new policy about longer-term funding. The capability fund is part of that. It is currently a relatively small part still of Crown research institute funding—about 7 percent—but I intend that figure to carry on rising because we need that kind of stability. 
I stress to those people in the Chamber who may be concerned about this issue from the contestability end that it is not about getting rid of contestability or competition. It is appropriate to have that as part of the balance of funding and we will make sure that there is a balance between longer-term stable funding and shorter-term competitive contestable funding. 
I will make a couple of quick points about the Crown research institutes. There are nine of them. Over the last while I think we have seen them perform well. They have come before the Education and Science Committee which is a great idea. They have great science to talk about; in fact I am sure the select committee almost feels as if it has to toss the members of those institutes out of the room at the end because they are so keen to explain what they are doing with science. 
Certainly I urge people who want to know more about our science to get alongside the Crown research institutes to find out what fantastic things they are doing and planning. They have a great record and they are doing great things but I want them to connect more with the country. That means they need to be talking more—in platforms like the ones they have been invited to this year. The whole job of the Crown research institutes is to create value. That is what they should be doing; they need to be connected to this country and talking the language of creating value. 
Brian Donnelly raised the issue of the one Crown research institute that has had some difficulties this year Industrial Research Ltd. The case of this Crown research institute illustrates why we need to change the model in two senses. Firstly Industrial Research Ltd has drifted away from its original aim probably because it did not have enough stable funding to hold it in a very difficult area—that is small industry does not make an easy customer for a Crown research institute whereas agricultural research applies to the agricultural industry which is a very integrated industry because of cooperatives and so on. It is not the same situation for the thousands of businesses that are out there so Industrial Research Ltd has found over 16 years that that is a difficult thing to relate to. It has drifted away to where it can get that return and as a result it has moved towards more commercialisation. That is the second lesson we have learnt from Industrial Research Ltd: how to commercialise. 
Brian Donnelly said there must be distilled wisdom. There is distilled wisdom but there is still some more of that wisdom to go through Cabinet in order to see the new model for commercialisation. We have said to ourselves that we need to look at how to commercialise in a way that fits New Zealand and fits the different Crown research institute models. We think we have some distilled wisdom and we know that one of the things we should have done with Industrial Research Ltd for example was to ensure that it had a commercial partner earlier in the commercialisation cycle. That is a good example of a different way of doing things and of a lesson being learnt. But we have also learnt some good lessons from Industrial Research Ltd. 
Across the board I want to thank the Crown research institutes and the foundation for what has been a great year. Those people are just stunning in their commitment to what they are doing in science and I want to see them receive the kind of backing from Parliament that will enable them to carry on driving the innovation in this country. I thank them for their work. 
Report noted.