Shearer David: State Sector Management Bill — First Reading 
Shearer David: State Sector Management Bill — First Reading 
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DAVID SHEARER (Labour—Mt Albert) 
: 
 I will make a couple of points straight off about the State Sector Management Bill. We oppose this bill because we oppose the amalgamation of Archives New Zealand with the National Library which Grant Robertson spoke about. We are somewhat more agnostic towards Part 1 which relates to science and the amalgamation of the Ministry of Research Science and Technology and the Foundation for Research Science and Technology. I discussed the amalgamation with my colleague Pete Hodgson who is a former Minister of Research Science and Technology. He looked at the issue about 3 or 4 years ago and he decided that although there were some advantages it was not really worth the cost. 
We do not have very strong feelings about this legislation but I will make three points. The first point goes to what Mr Peachey was saying a minute ago about the costs. I do not know where he gets his costs from but I have the Auditor-General’s report. The Auditor-General said about the amalgamation of the Ministry of Research Science and Technology and the Foundation for Research Science and Technology that the cost in the next 2 years will be $7.4 million. By 2014 in 4 years’ time we will have saved $4 million. I ask Mr Peachey whether we will make up $3.2 million in the coming decade. He is absolutely and utterly wrong in terms of the costs. Although Labour members are willing to stand up and say that we are agnostic about this issue that member should not use that admission to warrant saying that this measure will save us lots of money and that somehow Labour spends lots of money. I tell Mr Peachey that his party is spending the money here not us. That is my first point. In the short to medium term this bill does not create any savings which is one of its objectives. It may create some efficiencies that we are yet to see but it does not address the turmoil and confusion that will be created and it does not address the loss of productivity that will happen when those two agencies are brought together. It is a little bit more difficult to estimate the costs that New Zealand will suffer. Let us think about the $7.4 million that we will be spending on this issue and the $3 million that we will lose after 4 years that could be spent more effectively on real science rather than the shuffling of deck chairs that the National Government is proposing. 
The second point I want to raise is that the Government has decided on a new name for this amalgamation which is the Ministry of Science and Innovation. I commend the Government for the new name. It is a good name and I think it identifies where New Zealand should be going. I give credit to the Government for that. It inspires thoughts of what is going on in like-sized countries like Finland Denmark Israel and Singapore where they spend upwards of 3 or 3.5 percent of their GDP on research and development. We spend 1.2 percent of our GDP on research and development. Most of that expenditure is in Government circles not where it is really needed which is in the private sector. Although the name sounds very good and very inspiring the reality of where this country will go in terms of its real science and innovation falls somewhat short. In a way this amalgamation is the same wine in an old bottle. We will not really be getting the step change that we have been promised for so long. Colin James wrote about the Budget and mentioned the so-called step change in the science and technology sector. He said: “But we do know it is not a step-change. Mr Key talked in his RST pre-budget speech of ‘igniting potential.’ ”—which is the report Dr Mapp put out—“But he used a small match well clear of all but a little flammable material.” In other words it was a fizzle. There was no real flame; there was nothing to inspire or inflame people in terms of moving forward in science and innovation. 
We come to a significant point with this new ministry. It needs a new chief executive officer and the new chief executive officer needs to be somebody who will inspire who will lead and who will be world beating in terms of the way that we address science and innovation. So what did our State sector do to advertise the position? It advertised the position for 2½ weeks in the middle of June and July when in the northern hemisphere many people are on holiday. We have not really tried to find the best. We have looked around and said: “She’ll be right.” We will do the same old thing that we have always done: “She’ll be right.”—poke poke nudge nudge—“You can have the job.” I do not have anything against the new person; I do not know who will be taking over this job. But I expect that person whoever it will be to have been picked out of an international pool of talent; I do not expect that person to be just the guy up the road who happens to be hanging around and giving somebody a wink and a nudge. That is not what we want for this ministry. 
The third thing I want to mention is that this Government is always going on about how we need to catch up with Australia. Let us look at Australia’s spend on research and development and science compared with New Zealand’s. Australia upped its budget for research and development and science by 25 percent last year. What did New Zealand do? We spent 7 percent more following the great Budget announcement in May. Of that figure 5 percent will go towards inflation—we already know that—so in real terms it is a 2 percent increase in research and development spending by the Government which is trumpeting this bill as a new march forward. 
Hon Steve Chadwick 
: How aspirational. 
DAVID SHEARER 
: It is not aspirational at all and it is not inspirational. It is aspirational in the sense that it needs an aspirator in order to breathe. This bill is choking the innovation we want to see in New Zealand. 
The Government’s new spending amounts to $56 million a year. Most of that figure will comprise grants and vouchers for which companies will have to apply to the Government. This initiative will not lift the amount companies spend on research and development as the research and development tax credit would have done. Rather than instilling a new culture in those companies as they think about research and development it will instil in them what this Government has told us to avoid which is dependence on the Government. Companies will now go cap in hand to the Government to ask for more money to spend on research and development. The Government will not increase the companies’ own innovations and thinking or the new and exciting projects those companies are capable of. 
Mr Peachey said he knew what I would say next and I say to him that this spending is half of what National promised in 2008. It is half of what National took away from the previous Labour Government in terms of spending that was already on the book in play and functioning in the form of the 15 percent tax credit. The National Government has been money-pinching to a degree that has undermined spending on science and innovation in this country. 
Amalgamating the Foundation for Research Science and Technology and the Ministry of Research Science and Technology may look like something inspirational but it is far from what we need. It is an insipid rather limp attempt to look like we are busy when in fact the real issues of the day are going untouched. Thank you.