Since science was ignited as the fuel of economic growth the flame has gone out, writes Jeff Tallon

When the Key Government came to power in 2008 it promised to place research, science and technology at the forefront of its drive to fuel the economy through innovation.

Within a year the new Government established the Office of the Prime Minister's Chief Science Advisor and in the same year inaugurated the Prime Minister's Science Prizes with the aim of raising the profile and prestige of science among New Zealanders.

Now eight years later, and with a change in leadership, it is appropriate to consider where that vision has led.


Certainly there were some great outcomes. Key's Government supported the idea of the Agricultural Greenhouse Gas Research Centre which the PM opened in early 2010.

In the same year the Government was also a key player in helping establish the Global Research Alliance pulling together the expertise of some 30 countries to reduce carbon emissions and develop new technologies for sequestering carbon. John Key opened the inaugural meeting.

But the central challenge for New Zealand is how to improve our national productivity which is abysmally low by international standards.

From 1980 onwards, New Zealand productivity increased at well less than half the rate of the European Union's top 11.

This is not a question of size because these numbers are all on a pro rata basis. Denmark, for example, has increased its productivity at more than twice our rate.

The accumulated effect over 30 or 40 years is huge. We simply cannot now afford to do the things we would like to do in a modern democracy.

In 2008 the Government rightly saw that innovation through science and technology was a key answer to this challenge. Over the previous 30 years total research expenditure had remained relatively unchanged at 1 per cent to 1.2 per cent of GDP.

In contrast Denmark had trebled its research expenditure over that period to around 3 per cent. Small wonder that they have moved relentlessly ahead of us in productivity and GDP.

After a small boost in 2009 we have actually gone backwards. Official data shows our research, science and technology investment has dropped steadily from 1.32 per cent in 2010 to 1.27 per cent in 2012 to 1.17 per cent of GDP in 2014.

We are still awaiting the data for 2016. Crucially, private sector investment sits near the bottom of the OECD family of nations. New Zealand is seriously research averse.

Neither the vision, nor the Office of the Science Advisor nor the Science Prizes nor the perennial restructuring of the science sector has done a thing to get this ship steering towards the kind of investment targets we should have in front of us.

As a consequence we will continue to fall short in our aspirations for education, health, transport and welfare - because we can't afford those aspirations and we don't invest enough in research, science and technology to turn our productivity around.

The data is actually worse than typically presented, ratioed to GDP. Because we have a low GDP per capita it means research investment per capita is not a third that of Denmark but more like a seventh.

Sadly, though the data is well-known, research leaders and agencies tend to avoid protesting because the received wisdom is that rocking the funding boat is counter-productive.

From a brilliant start, the Government then took the tempting detour of restructuring and promptly lost the vision.

Science is now buried somewhere in the Ministry of Business, Innovation and Employment (MBIE) along with it the vision and the focus.

With Industrial Research Ltd morphing into Callaghan Innovation we no longer have a crown research institute focusing on research for the manufacturing sector - the sector most likely to be able to deliver significant productivity gains.

Its research arm was decimated and now it is largely just a funding body where other such agencies already existed. Callaghan Innovation seems to have been at sea since its inception and the only significant changes it seems to have made are its staff - on an all too regular basis.

Governments have been running down the wider crown research institutes sector for the past 20 years. Research investment in that sector has declined over that period, as has the number of researchers.

This is a profound change in the science system, clearly someone's predetermined strategy, but it seems to have occurred unscrutinised and without evidence-based justification.

Possibly the biggest failing was to scrap the research and development (R&D) tax credit. With the global financial crisis biting hard in 2009, tax credits were seen as unnecessary budgetary expenditure.

But research is an investment, not a cost, and concerns about abuses could easily have been met by suitable checks.

One that I proposed was to require R&D claims above a certain threshold to be vetted by the relevant crown research institute, thus not only keeping companies honest but giving immediate interaction between CRIs and all research-leaning businesses across the nation, surely opening opportunities for seeding, refining and resourcing new ideas.

We need to get away from immigration-fuelled growth (with all its problems) to innovation-fuelled growth. Research, science and technology needs to come back out of MBIE if the original vision and focus is to be regained.

But the lesson surely is to avoid restructuring. Achieve what is needed through existing agencies by setting the right mission, appointing the right people, and imposing the right accountabilities.

And it is inescapable, the Government needs to invest here much more heavily. We need to fund strategies, not projects.

Where is the follow-up on all the new ideas that have been funded over the years? New ideas come easily. But is there a market, what is the path to the market and what were the outcomes?

Surely it is better to support research teams that have a strategy of alignment with industry or are actively creating new industries.

The minister responsible for research, science and technology has a huge challenge ahead - one no previous minister has adequately addressed.

It is all too easy to be distracted by exciting discoveries made by our researchers, to drift dreamily into a show-and-tell role and to dispense awards from time to time.

We need a comprehensive well-resourced science system with each agency having clear roles and a well-defined mission, and the Government needs to reaffirm all parts of the system, crown research institutes included.

But more importantly, we need a sea-change in the culture of our research-averse industries and it will require determined and wise action from the top down.

There is work to be done.

• Jeff Tallon is a physicist specialising in superconductivity.