The PSA says hundreds of jobs could go as Callaghan Innovation is axed. Science, Innovation and Technology Minister Shane Reti says it's too early to say how many staff will be made redundant or transferred to new agencies.
There could be a gap of six months or more between the end of funding for Callaghan Innovation in June and the creation of an as-yet-uncertain number of new research roles, the Public Service Association (PSA) says. The union sees talent heading offshore.
“This will be a brain drain of the Government’s own making,” PSA acting national secretary Fleur Fitzsimons said.
“How can the Government expect these people to hang around with no income, waiting for the new public research organisations [PROs] to be set up, which is unlikely to happen until next year?”
A letter of expectations from new Science, Innovation and Technology Minister Shane Reti to Callaghan chair Jennifer Kerr, sighted by the Herald, says funding for Callaghan Innovation will cease on June 30 – a date not previously made public.
A timeline for science sector reform, issued by Reti’s predecessor in the portfolio Judith Collins on January 23, anticipates legislation enabling science sector reform, including three new PROs that will absorb the seven current Crown Research Institutes (CRIs), plus a new advanced research PRO, will be passed in the fourth quarter of this year and take effect in 2026.
Following cuts last year as part of the Government’s across-the-board drive to lower public sector costs by 6.5% to 7.5% last year, Lower Hutt-based Callaghan employs around 350 people, including around 150 scientists, plus staff who wrangle grants and connect businesses with researchers.
“It’s astonishing that the Government is pressing ahead with Callaghan’s closure without a plan for many of the highly skilled workforce to transition to the new Public Research Organisations. MBIE should immediately set up a process to retain these specialist scientists,” Fitzsimons said.
“The Letter of Expectations exposes yet another poorly thought-through decision by the Government that will see our best and brightest scientists, researchers and lab workers at Callaghan Innovation being forced to go overseas and find jobs in countries which value science,” she added.
“There are people working in medical technology, artificial intelligence, biotechnology, and other areas of technology which are of great value to New Zealand.”
“Hundreds [of Callaghan staff] could lose their jobs, including at least 75 science and research staff by our estimate,” Fitzsimons said.
“There is significant work ahead to manage the disestablishment of Callaghan Innovation,” Reti told the Herald.
“It’s too early to say how many staff will be transferred or made redundant.
“While I expect to be kept up to date at key decision points, this will be managed at an operational level.”
In written responses, Reti did not directly address the PSA’s claim that scientists would spend six months waiting to find out if they had a job to go to.
Fitzsimons said he needed to. She quoted a line from the Science System Advisory Group Report, led by Sir Peter Gluckman, that served as a precursor to the restructure. The report said: “Actions will be needed at multiple levels to develop and retain a high calibre workforce of researchers, scientists, innovators and entrepreneurs.”
As things stand, Fitzsimons sees Callaghan researchers long gone by the time a new advanced research agency is set up - leading to the “madness” of the Government being forced to recruit offshore to staff it.
A science sector shakeup announced on January 23 – following a report from a panel led by Sir Peter Gluckman – will see seven Crown Research Institutes (AgResearch, Scion, Manaaki Whenua-Landcare Research, Plant and Food Research, Niwa, GNS Science and ESR) grouped into three Public Research Organisations - one focused on “the bioeconomy”, one on earth sciences and one health and forensic science.
There will also be a fourth PRO; a new agency that will, in Collins’ words, “drive research into advanced technology PRO that deliver research, capability and commercial outreach around technologies such as artificial intelligence, quantum [advanced computing] and synthetic biology”.
Ben Wylie-van Eerd, a Callaghan senior scientist and PSA delegate, said he and fellow researchers had been left hanging.
“Many of us thought Callaghan would be shut down, but we thought there would be an orderly transition to roles in the PROs,” he told the Herald.
“Instead it’s like we’re being told ‘You’re not wanted here. Look for a job somewhere else’.”
Wylie-van Eerd said many of his colleagues are doing just that. “They’re prepping CVs.”
Researchers were scouting for roles in Europe and elsewhere overseas. And they were doing it now rather than wait for the June 30 funding expiry and the uncertainty that lay beyond that date.
Wylie-van Eerd said there was a clear plan for a number of Callaghan functions – if an unknown number of associated staff - being transferred to existing agencies, or one of the three PROs that will absorb the seven CRIs.
MBIE will take over the role of administering the R&D tax scheme. Various Callaghan startup incubator programmes will also be transferred to MBIE. Callaghan’s Food Innovation Network, Bioresource Processing Alliance and Measurement Standard Laboratory will go to applicable PROs. A new “one-stop shop” called Invest New Zealand will be responsible for attracting international investment and talent.
But Wylie-van Eerd said he and around 75 other scientists had been left in limbo, with few details yet about the new advanced research PRO, and its enabling legislation not due to come into effect until next year.
In written comments to the Herald, Reti did not address the claim that Callaghan research scientists would be left waiting a potential six months or more to find out if they had a job, but said: “Callaghan Innovation was spread too thin across many conflicting functions – it’s struggled to work to a clear focused purpose.
“We want New Zealand to be a country where scientists can pursue world-class careers. The science sector reforms aim to ensure we focus our investment that will generate the greatest value for our economy and our people. It’s focused on strengthening New Zealand’s science system, not on job cuts.”
Named for Sir Paul Callaghan, Callaghan Innovation was created by the National-led Government in 2013 as Industrial Research Ltd (IRL) – a Crown Research Institute – was renamed and given an expanded role in supplying financial assistance to startups via direct grants and loans. As Labour came into power under Dame Jacinda Ardern, Callaghan’s role diversified further from IRL’s more research-orientated function as the agency became responsible for administering a new tax break for research and development (which had little initial impact with NZ’s R&D as a percentage of GDP remaining stubbornly low next to OECD peers).
In December 2023, the auditor-general delivered a scathing critique of Callaghan’s conduct in deciding not to award contracts to We Are Indigo/Manaaki, an Auckland-based company offering services to startup firms, in 2022. A report tabled to Parliament found failed or inadequate due diligence, transparency and handling of conflict of interest issues. Boardroom infighting followed.
One of the only knowns is that the Government wants the sector restructure, including the new advanced technology PRO, to be achieved within the current $1.2 billion science budget – a contrast to across the Tasman.
While still driving the Science, Innovation and Technology portfolio, Collins also said there needed to be less blue-sky research and more “science-with-a-purpose” with more immediate commercialisation prospects to help lift the economy. Collins had earlier nixed Labour’s “science city” plan to create a series of new R&D hubs in Wellington, under the Callaghan umbrella.
That left Callaghan with its existing Cracefield Innovation Quarter in Lower Hutt. In his Letter of Expectations, Reti asked Callaghan to “explore commercial opportunities to the site as a centre for science and innovation”.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
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