The Budget has delivered a modest funding bump for the science and innovation sector – while bringing New Zealand closer to its goal of lifting research and development to 2 per cent of GDP.

This year's allocations included $324 million for the Strategic Science Investment Fund (SSIF), $226m for research and development growth grants, and $243m and $79m for the Endeavour and Marsden funds respectively.

There were also pots of $115m for the National Science Challenges, $110m for Callaghan Innovation and $110m for the Health Research Fund.

Anthony Scott, the chief executive of Crown Research Institutes peak body Science New Zealand, was pleased to see an increase to the Government's Strategic Science Investment Fund – the first significant one since it was established.

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He was similarly happy with an 8 per cent funding increase for the Ministry of Business, Innovation and Employment's Endeavour Fund.

"That increase was previously signalled but to have it continue when we're obviously facing a very constrained future as a nation is also a really good signal from the Government about the importance of innovation, science and research in the Covid-19 recovery and rebuild."

New Zealand Association of Scientists' (NZAS) president Professor Troy Baisden pointed out that overall spending in the research, science and innovation portfolio was due to top $1.5b for the first time next year.

"That's an increase of more than 80 per cent over five years, and substantial progress towards the goal of lifting R&D to the goal of 2 per cent of GDP," Baisden said.

"That target would place us in line with comparable nations' efforts to improve our productivity and technology, which leads to future growth as well as social and environmental wellbeing."

A big chunk of the total increase came from business R&D, and that would be uncertain as bottom lines take a hit from the crisis, he added.

"Because business could have trouble making use of the R&D tax incentive scheme, $150m in loans for business R&D was announced."

For scientists in institutes and universities, meanwhile, there were some limited increases, such as the $20m bump for next year's Endeavour Fund, the main applied research funding scheme, although there was no lift for the premier "blue skies" pool, the Marsden Fund.

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Baisden wasn't surprised funding for the Health Research Council was on track to hit $131m – amounting to an overspend of $14 million – but was surprised at a nearly doubling of the Catalyst Fund to $35m, given the pool was focused on international collaboration, and that travel was difficult.

He said the association was more disappointed to see no new funding targeted to support early career fellowships, at a time when the usual path for many recent PhDs overseas was cut off.

"That's one small area that could have made a big difference to those graduating or starting their careers at an uncertain time, or today's students considering whether careers in science will be stable jobs of the future."

Former NZAS president, MacDiarmid Institute for Advanced Materials and Nanotechnology co-director Associate Professor Nicola Gaston, described the Budget as one that would've been disappointing for science under normal conditions.

"There is a tiny bit of cash put aside to increase Strategic Science Investment Fund Platforms programme funding for Crown research institutes, acknowledging attrition of funding; there is a small capital injection of $15m into ESR – and that appears to be it," she said.

"There is $150m for business loans to support R&D – that number appears to be what Treasury pointed out last year was needed to move government spending towards its stated 2 per cent target, so is not accidental – but this, while a welcome complement to the science sector, does not replace investment in the development of skills and capacity in research.

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"That said, the increase of the per student subsidy for tertiary education is welcome though overdue, though it is a relatively small-scale investment alongside the money put into trades to encourage people to retrain in selected industries."

Gaston said she would have preferred a more holistic approach taken to recognise how the research ecosystem could support recovery and develop the resilience of the New Zealand economy over the medium- to long-term.

"Under Covid-19 conditions, the Budget was never going to be what it would have been prior – and I would never suggest that research, science, and innovation should be higher priorities than social services, health, and education right now – but it would have been reassuring to see Budget signals designed to create activity in the science system in the right places," she said.

"The biggest threat to the long-term stability and success of our research and innovation ecosystem right now is that we lose capacity as people disengage, fail to complete their studies or research programmes due to economic impacts, and that these losses are compounded by disrupted career paths and lost opportunities due to closed borders over the next year or even longer time frames."

Gaston said the sector was going to need to be agile and proactive to retain talent.

"And in the short term, I would have liked to see more emphasis on immediate retention strategies, rather than retraining alone," she said.

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"It is always possible, of course, that some of these outcomes will be able to be achieved by work being done within the sector and within MBIE – for example, by re-prioritising Catalyst Fund expenditure to support international research relationships, to support post-docs based in New Zealand.

"But I do think the time is ripe – or in fact, now urgent – for a well-designed postdoctoral fellowship scheme that would retain and develop talent within New Zealand to support our high impact, low footprint industries in sustainable innovation and green tech."

"So what is most disappointing to me, in fact, is to see yet again that this opportunity has been missed."