McKelvie IanIAN McKELVIE (National—Rangitīkei): Thank you Madam Chair. I shall take a brief call on the Taxation (Research and Development Tax Credits) Bill at the committee of the whole House stage to express a few concerns I have about the bill. I guess the major concern I've got with it is that I think it is going to be extremely expensive and complicated to access the tax credit regime. I think that's OK for the companies that are equipped to deal with this and that have been in the business for a long time. They'll manage it very well. And it will work for some of the bigger R & D expenditure companies in New Zealand. I don't think it's going to work for the next level and I think it will be very expensive to get into and I think it will probably put some of them off accessing this opportunity—which I think is a bit of a shame.But this is an area in which I think we've struggled in New Zealand since the 1980s frankly and we've yet to find a real solution that works for research and development in New Zealand. We've seen a decline as a percentage of our gross spend in New Zealand. We've seen it decline over the years and that happened—or the decline was initiated—with the changes that happened in the 1980s where Government pulled out of a lot of R & D that it did itself through the universities and through what in those days were things like the Department of Agriculture which of course have changed their name now—but AgResearch and those sort of companies did a lot of this kind of research and development in New Zealand. And it was actually great value to this country. But we changed the way we did things and we expected the industries to pick those opportunities up. They really haven't picked them up satisfactorily—with a few exceptions—in New Zealand since that time.I think that's the big challenge that I see with the R & D tax credit regime: is how in fact we get people introduced into it and how we get them to access it with confidence particularly the smaller New Zealand - based firms. I was pleased to see one of the changes that was made as a result of the select committee process was the opportunity to use outside contractors. I think that was hugely important because initially the bill precluded outside contractors. It didn't preclude them being used but it precluded them from being claimed at the full rate. And I think it's essential that we do enable the use of outside contracts in this because many firms in New Zealand that will be accessing this cannot afford to employ that expertise themselves and in fact that expertise isn't available in abundance in New Zealand. So that's a real challenge and I think that was a positive change that the Finance and Expenditure Committee made to the bill.There've been numerous estimates of the amount of money that this will cost annually and I think it is a bit of a guess myself because as I've said earlier with the exception of the large R & D expenditure companies I don't think we've got any idea how many people will be able to access this in the next tier of businesses that are looking for this type of incentive or opportunity.The other area that I think is going to create some challenges will be around those start-up companies who can claim effectively a tax credit in advance. And that's a pretty risky business when you think about it because you're going out there spending money you don't know whether you're ever going to get it back and you're getting a grant back from the revenue I suppose in a form but actually you don't know what's going to happen with the other 70 percent of the dollar you've spent. So it's quite risky and it's taken the place of what effectively were expenditure grants—or in some cases dollar for dollar matches.I'm not so sure that's going to work either because I think that is a risky area for companies to get into particularly companies that have got—well I guess all start-ups to some extent are in a very unknown space and dealing in uncertainty to a large extent. And I wonder how confident we can be that they will actually access this or want to access this and then be able to in fact keep themselves going once they've done that. So I think there's some risks in this policy certainly below those large companies that understand the system and will be able to access and do well with it.So for that reason—well for that and a number of other reasons—we oppose this bill. I think it is high time in New Zealand we got to a point where we had a comprehensive R & D policy in place that covered business in general in New Zealand and I'm sure we would find the expenditure in those areas greatly increase as a result of that.So that's the reasons that we're opposed to it. I do think there's some questions that we could well have answered in the course of the few minutes I've spent talking about it. So thank you.