Mapp Wayne: Debate on Prime Minister’s Statement 
Mapp Wayne: Debate on Prime Minister’s Statement 
[Volume:660;Page:8992] 
Hon Dr WAYNE MAPP (Minister of Defence) 
: 
 As the Prime Minister said last week New Zealand has a substantial challenge ahead of it and that is closing the income gap with Australia. I say to members opposite that they also recognised that that challenge existed in 2000 and they totally failed to even think about closing that gap. There is no doubt that it will be a huge challenge because it requires that New Zealand has a sustained higher growth rate than Australia over time—not for 1 year not for 2 years but over a sustained period of time. We in New Zealand can be sure of course that Australia will not rest on its laurels during that period of time. 
One of the key opportunities that New Zealand has in bridging that gap is by the effective application of science to business innovation. It may be true that Australia has a large amount of accessible minerals but New Zealand has clear advantages in agriculture and other areas and the success of New Zealand’s agriculture has always been built on the application of science. Many places in the world have good rainfall and temperate climates but few have achieved the productivity levels of New Zealand in this sector and we have done so fundamentally on the basis of the application of science. Many of the Crown research institutes in fact are completely directed to that purpose: AgResearch the National Institute of Water and Atmospheric Research Landcare Research and Scion just to name a few in that field. In addition there are the emerging sectors of biopharmacology digital film and sophisticated manufacturing particularly where there is no long-range production but rather there is short-run production with unique requirements. 
Today I went out to Weta Digital which of course is where  
Avatar 
 was made. That movie has been a world-wide success so it makes sense for New Zealand to co-fund the next stage of that technology. Those members who have seen the film and the imagery of running water and so forth may have thought that that was a natural New Zealand river. In fact the scene is entirely digital which is the innovation that Weta Digital brought to that production. When the Foundation for Research Science and Technology invested $5.8 million along with Weta Digital—which is putting in $2 for every $1 that the foundation is investing—that is intended to take what we saw in  
Avatar 
 to the next stage of technology. That is the competitive edge. There were a thousand people working in Wellington in that sector and a leading edge technology has been built in this area. A whole fabric of companies that do that has been built around Weta Digital and this is one of the sectors that has proved that it is successful in the marketplace. 
It pays for the New Zealand taxpayer to back that sort of success because for the nation’s investment we will benefit from $300 million being spent primarily in the Wellington region through those companies and then going out into the wider economy. It is similar with more traditional areas like Zespri. The co-funding of $15 million— 
Chris Hipkins 
: The what? 
Hon Dr WAYNE MAPP 
: —the co-funding—over the next 7 years will enable Zespri to develop in essence the next Zespri Gold kiwifruit. It might actually be red in truth but gold kiwifruit produced just last year $400 million in revenue which was a direct payback for the research expenditure to date. Plant and Food Research alone received $10 million in licensed revenues. The reason I am focusing on these success stories is that this is how we grow the New Zealand economy. This is in fact the sort of example which the Prime Minister referred to in his speech that shows how we can build the New Zealand economy to go forward. I mention for instance another case in point: Fisher and Paykel Healthcare. That company has grown over a relatively short number of years to be one that had $500 million in revenue last year. I will repeat that for the benefit of the House—half a billion dollars. The foundation has invested in that company in its research space and I stress for members that that investment is in research the next level of technology and is for $3 million. 
The Government has looked at the opportunities around this area and we say that if we can put more emphasis on science that will be a core driver of innovation the next stage of economic growth. That is why we have chosen that as one of the six sectors; that is why we have in fact said to the nation that we see it as the pathway for an accelerated level of growth. We have to have an accelerated level of growth if we are to bridge that wealth gap with Australia. I say to members that when I became the Minister of Research Science and Technology it was clear that the science sector needed a substantial improvement so I have spent a lot of time listening to scientists and to science managers and talking to businesses and asking them what things need to be done that will make the difference. They say that we should get rid of the complexity get rid of the bureaucracy and focus on expenditure that enables scientists to get on with their business. So that is precisely why we established the Crown research institute taskforce and it will be reporting back to Ministers shortly. It is our intention to get more outcome—more science in fact—out of the Crown research institutes which will enable us to drive the innovation sector ahead. 
I want also to say what we did in 2009. In 2009 we increased funding for the Marsden Fund by 23 percent. It was the largest increase in its history. We increased funding for the Health Research Council by 20 percent. We increased funding for the Crown Research Institute Capability Fund by 18 percent. These are real gains that are building the research infrastructure of our country and the Crown research institute taskforce is intended to build on that. The appointment of the Chief Science Advisor to the Prime Minister Sir Peter Gluckman has also been part and parcel of that. I can say to members on both sides of the House that I along with the Prime Minister am working closely with the Chief Science Advisor to build the next platform of growth. 
Members might ask how we will bridge the gap with Australia. The way we do so will be to build the innovation culture of this country—to build on existing success and then to power it up and take it forward to the next level. I can tell members that the next Budget will set out the platform that will drive our economy ahead. The Prime Minister’s statement has made the clearest set of priorities and 2010 will be the year in which we will lay the foundation for growing the economy. When I listened to Mr Ross Robertson all he could focus on was GST. All he could do was focus on GST. He said it was going to go up by 2.5 percent; I have to remind members on that side of the House that their Government increased GST from 10 percent to 12.5 percent and there was no compensation. National has said to all New Zealanders that everyone will be better off under our tax package and that we will be growing the economy. Budget 2010 will set that platform.