Martin Tracey: Callaghan Innovation Bill — Third Reading 
Text is incorporated into the Bound Volume 
Martin Tracey: Callaghan Innovation Bill — Third Reading 
[Sitting date: 04 December 2012. Volume:686;Page:7020. Text is incorporated into the Bound Volume.] 
TRACEY MARTIN (NZ First) 
: 
 Kia ora. I am pleased to rise to speak on the Callaghan Innovation Bill after Dr Paul Hutchison. I think his final comments were very very interesting. They were around flexibility innovation and having an opportunity to have a research and science provider with that flexibility. So on the one hand you could say that the bill is very permissive or you could say that actually we require environments of trust with oversight. I would hope that the Government benches having reached into this area of trust of experts in their field with oversight might like to shift that view to education. That would be great—that we actually trusted the experts in our current schools and provided some flexibility and some innovation abilities inside that field. 
But back to the Callaghan Innovation Bill. I want to reconfirm again that the understanding of the Education and Science Committee was that 80 percent of the role of this institute is relationship building—that is the networking of business science and research institutes to produce commercial outcomes that will lift New Zealand’s exports. One of the intended consequences is that any sort of lift in that performance in that commercialisation and in that productivity would lower New Zealand’s unemployment numbers and I think that is probably what we are all hoping will happen. The manufacturing jobs downstream of a new commercial entity of a new commercial enterprise that had come out of this networking and this relationship between business and science would drop New Zealand’s unemployment as opposed to taxpayers’ money being expended on this research and this commercial development and then another country’s unemployment numbers dropping. 
 So one of the side effects and one of the flexibilities that we would like to see as a downstream effect of Callaghan Innovation is that when these products are developed when they are brought to a commercial point then manufacturing is considered here in New Zealand. The price of the widget or the manufacturing price of the widget is not the only consideration and those select committee members who discussed the difference between “benefit” and “net benefit” will know what I am talking about. 
That leaves 20 percent of the role as understood by the select committee that stood around direct investment by Callaghan Innovation into research funding and that was very very clear. I was pleased to hear the Minister of Science and Innovation say in the beginning of his speech that Callaghan Innovation would not be a distributor of contestable funds because it was a concern around them having two hands in the same pot. 
I guess what it does do though is it now opens concerns that the members on the Opposition benches of the select committee attempted to get some security around: the way that the institute would seek funding. It was very clear from the submissions that contestable funding is tight. We did not want to see another player in that field. The intention at least on the Opposition benches I believe was that this 20 percent would be a pool of the institute’s own money with which to invest in research and development with business that is not currently met by any other fund. So I am a little concerned that the Minister now says that it is not going to be distributing contestable funds because I believe that opens the door to it to now be a competitor for those funds and that was not what was discussed at the select committee. But at the end of the day you have to put this out there with trust but obligations and trust and oversight and there will be many of us who will be watching. 
We also had a big conversation around the duplication of research and I want to also put that on the record. It was made clear to us at select committee that not all duplication is bad that particularly in research to have the testing or the research done by another organisation completely hands-off and removed from the first one to verify results or to maximise whatever the outcomes are is not necessarily a bad thing. But it is going to be one of the things that Callaghan Innovation is going to have to work out over time. Where is that balance between productivity as in duplication of research and then actual destructive duplication? 
There is still a gap and I am pleased to see the member Colin King in the House right now because he very kindly at the Committee stage shouted across the Chamber to me—when I was looking for some assistance about whether this bill might provide assistance to Mahurangi Technical Institute and its eel-breeding programme to take it from 12 days to a commercially viable operation—“PGP” which is the Primary Growth Programme I believe. 
Colin King 
: Partnership. 
TRACEY MARTIN 
: Partnership—I beg your pardon. It is the Primary Growth Partnership. 
Colin King 
: I’m here to help. 
TRACEY MARTIN 
: And I want to thank him for his assistance. It is very kind of you—thank you very much. So I went away to check on Mr King’s advice and unfortunately in this instance not only has this research unit applied twice to the partnership fund but it has applied to every other fund that the Government actually has for this sort of development the last one directing it back to the Primary Growth Partnership. It was to absolute shock and horror that in question time today the Hon David Carter got up and announced that $43 million of New Zealand taxpayers’ money will be given in research dollars to a company owned by the Japanese— 
Colin King 
: Partially owned. 
TRACEY MARTIN 
: —owned by the Japanese—and therefore this small completely New Zealand based New Zealand - owned New Zealand research institute cannot find $3 million from its own Government. I think that is a shame Mr King and any assistance you would like to give me and the people at Mahurangi Technical Institute in Warkworth to bring forward what will be one of the most productive industries for this country in an export market that everybody in Asia will be very keen to participate in I welcome Mr King. My office number is on your dial. 
I still want to bring up another point. There is a requirement to reimburse the ratepayers of Auckland. The ratepayers of Auckland—or more specifically the ratepayers of the old Manukau City Council—invested into The FoodBowl. The FoodBowl which is going to be absorbed by this bill is currently a wholly owned subsidiary of Auckland Tourism Events and Economic Development and it has on its books $2.5 million over the next 5 years. That is its budgeted amount obviously. That is from its 2010-11 budget going forward. I would suggest that the Government or the working party setting up the institute needs to go and have a look at the amount of money taken from those ratepayers from the 2010-11 and 2011-12 financial years. I think they need to write a cheque and give it back because this asset is actually an $18.1 million capital asset over there in Manukau City. It was developed by Enterprising Manukau which was a council-controlled organisation of that local body. Considering the drama that we had last week—and I need to ask Mr Smith actually. Does Mr Smith think that this is core business? 
Simon O’Connor 
: Dr Smith. 
TRACEY MARTIN 
: Dr Smith—I beg your pardon. Everybody wants their title. Does Dr Smith believe that this is core business that the ratepayers of the legacy Manukau City or the ratepayers of Auckland should be investing in? If not then I expect Dr Smith to go to his caucus and to fight hard to get that money given back to the ratepayers of South Auckland who goodness knows with social deprivation scores of 7 and 8 absolutely could do with some of their ratepayer money back. 
However New Zealand First will be supporting this bill. We support it on the basis of trust with oversight and we will be watching. Kia ora.