Ten research and development projects in Northland have been awarded nearly $1 million in Callaghan Innovation funding this year.

Projects include jet boat, forestry and beehive technology and biogas energy and oil and gas analysis.

Five companies won project grants of between 30 and 50 per cent of the eligible R&D costs. Kaipara's Salt River Industries will use its $125,268 towards jet boat technology innovation, and Hikurangi's TS Farming Solutions will develop a biogas energy system from dairy effluent with its $245,500.

Hikurangi's Ben Smith of TS Farming is developing a system to turn dairy effluent into bio-gas energy. Photo / Michael Cunningham
Hikurangi's Ben Smith of TS Farming is developing a system to turn dairy effluent into bio-gas energy. Photo / Michael Cunningham

The Far North's Resin and Waxwas granted $232,857 while

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Forme Consulting was given $25,161 towards its work with smart technology to help forestry owners and contractors understand operational costs and variables. NZ Honey Traders in the Mangamukas has been granted $82,350 towards mobile and desktop application research into manuka beehive management.

And Independent Petroleum Laboratory at Marsden Point is expanding its analytical capability for the oil and gas industry with the help of a $55,121 grant.

Unlocking innovation Some companies received Getting Started grants of less than $4500 to "unlock innovation and remove barriers to support the development of new products and services".

"These companies are engaging external expertise and get advice. This grant is a tool we use to help derisk the process," said Joseph Stuart, general manager of business growth at Northland , which manages the fund in the region.

Dargaville-based Doors n More was developing a new type of fire door, while Kaitaia's Juken NZ Triboard was researching how to improve finished board properties. It had also benefited from a $25,333 grant.

Whangarei's NZ Tamarillo Co-operative was looking to restructure its organisation and add value to the product through processing, while Kerikeri's Promax Plastics has developed an insulated tank to help dairy farmers meet new MPI standards for milk temperature and save them about $13 a day on power.

As a number of the companies were not ready for market, they were not in a position to fully go public as yet.

Last year, Northland Inc handed out less than $500,000 in Callaghan Innovation funding.

Mr Stuart said the increase in funding "shows that there are strong aspirations this year for innovation and Northland Inc is gaining the trust of companies and delivering for them". Companies working with Northland Inc which had tapped into Callaghan Innovation grants, could also apply for funding from Northland Regional Council's Growth and Investment Reserve, Mr Stuart said. He said he was looking forward to seeing future data on how the investment would eventually translate into employment.

Growth grantNorthland companies had yet to show interest in the Growth Grant, said Mr Stuart.

This was for firms with at least $300,000 in eligible R&D spend in each of the past two years, or those who had spent 1.5 per cent of revenue on R&D.

Mr Stuart said the reason companies were not applying for these grants in Northland could be down to the level of advice they were getting from accountants or how they were writing off R&D costs.

These grant terms also include clawback provisions should companies breach the terms of the funding agreement, such as an inability to demonstrate that amounts claimed against the grant were for eligible research and development.

Companies approved for Project grants had to meet a range of criteria and prove their benefits for New Zealand.

"There are plenty of hurdles for companies to jump," Mr Stuart said.

Callaghan Innovation was still developing its procedures for monitoring companies which had received Growth Grants.

"The Callaghan tools primarily used in Northland are Getting Started and Project grants and the resulting distribution of investment is considered a discretionary activity. We work closely with the companies and they are successful in achieving support having met well defined criteria, including benefit to NZ (there are six in all).

"We then continue to work closely with companies to ensure ongoing strength to their R&D programme, and to assist them to achieve their growth aspirations," Mr Stuart said.

He said recent challenges to the system were primarily concerned with the Growth Grant, a "non-discretionary tool".

As long as companies maintain or grow their R&D in NZ, they are eligible for support and recent changes to legislation meant all companies supported were to have at least one director based in NZ.

"Should a company not fulfil their contracted terms as per their R&D contract with Callaghan, the clawback is a clause within their contract that provides for Callaghan to require the return of allocated funds," he said.

"Should this not be able to be mediated to a satisfactory outcome, there are legal options available, including using the courts system."

Just last month Callaghan Innovation terminated a grant for Trends Publishing International, seeking repayment of $382,911.97, after an independent review of the company, which was refuting the claims, was referred to the Serious Fraud Office due to an alleged breach of its Callaghan Innovation contract.