Bayly AndrewANDREW BAYLY (National—Hunua): Well thank you Madam Deputy Speaker. Nice to see the member Stuart Nash just talking a moment ago speaking freely without having to refer to other matter to help him. A comment he made which I found just somewhat troubling—I think I heard him say this and I just wondered whether it's true—was that under National we didn't grow the economy—Kieran McAnulty: That's not what he said. He didn't say that.ANDREW BAYLY: I thought he did. Well maybe that was the implication. Or maybe the implication is that Labour - New Zealand First is growing the economy more quickly. I don't think he actually meant that but what I'd say to that—[Interruption] What I'd say to that member is that under National for the last three years this economy grew at 3.3 percent on average across the three years. Since this Labour - New Zealand First Government's been in power it is now growing at 2.3 percent which is basically a third of what was achieved under our Government. The implication for that is a $3 billion decrease in GDP and a billion wiped off the value of the revenue to the Government's accounts which would've paid for this in one year if they'd just been able to manage a proper economy.Now I just want to return back to the bill.DEPUTY SPEAKER: That would be nice.ANDREW BAYLY: National is absolutely committed to seeing creative businesses grow and we've had so many of these dynamic companies come to the market come and produce new products new services whether IT or whatever and they are so important to the fabric of the New Zealand economy. I think that when you look around at all the new trends that are going on around robotics IT all that smart technology around it it is just so exciting.I think the one thing that we did have going with the Callaghan process was that we were in a process where we had professionals involved in managing R & D. We were working with those companies that we thought had the best opportunity of growing the New Zealand economy and making sure that they had the support around them to achieve the outcomes that we want. What has happened with those companies is that they've actually driven R & D and there have been some remarkable experiences. In fact I remember the Prime Minister going to the Methven factory a New Zealand company opening one of the new products that they had developed which of course had come around from the Callaghan institute funding. I say this is very important.The thing about where we're going with this proposal—whilst we absolutely support any efforts to grow the R & D pie in New Zealand the issue about this is actually twofold. The first one is how do you prioritise the expenditure—how do you prioritise the expenditure—because it's fine saying you've got a billion-dollar fund but who are the companies that are going to get access to it? Is it just on a first come first served" basis? If you are still working on your proposal and you don't get there before the billion is spent then you're not going to get the money. So that gives rise to one of two things. Either you miss out which is bad for "New Zealand Inc." because we put our money into those companies that are not delivering the highest value for New Zealand or their budget for this is going to blow out as it did in Australia. When they put in a similar R & D scheme they costed it at $1.8 billion. By the time the scheme had finished it was $3 billion. This is something that we've been asking the Minister about repeatedly. How is she going to make sure that we get the best value for money?The other issue with this is around pre-profit companies and this is where it's just silent—just silent. That is just as important in terms of a focus for the New Zealand Government in terms of growing those newer companies who are in pre-profit stage because they're probably just as dynamic as the bigger ones. At least we put in things like black hole expenditure deductions and cash out where you could offset the tax that you would've saved and get cash ability to fund those pre-profit companies. We actually put in place some real tangible benefits for those types of companies. This bill is silent on it and this is the thing about this bill that really worries me because I think it's actually a bit of a feel-good bill. This is good to be able to say "Tick the box. We put a billion dollars into R & D—doesn't really matter who we give it to as long as we get it out and we can say we've done it." If you're going to put in good policy make sure you put in good policy. It's interesting even using the facts from the advisers—they said 85 percent of this $1 billion fund is going to end up in the hands of 330 to 350 businesses. That's not too distant a future from what Callaghan is actually achieving now.So I think there are some real concerns with it. Of course we support R & D—of course we do—but the question is: is this the right mechanism? I think there are some serious doubts about it."