Australia's innovation policy a 'catch up' to NZ's: Joyce

Australia's innovation policy a 'catch up' to New Zealand's, Joyce says

By Fiona Rotherham

Dec. 14 (BusinessDesk) - Science & Innovation Minister Steven Joyce has rejected comments that Australia’s new innovation policy has leapfrogged it ahead of New Zealand, saying it was more of a “catch-up”.

Australian Prime Minister Malcolm Turnbull announced 24 innovation measures last week that are expected to cost A$1.1 billion over four years to support what he called “the ideas boom”.

The wide-ranging changes include more funding, tax breaks, and tax incentives, along with setting up a new A$250 million CSIRO research fund to support investments in spin-off and start-up companies and incentives to encourage better collaboration between universities and companies.

Kiwi science and innovation commentators raised concerns New Zealand would now need a policy refresh with Australia back in the game, with some worried it could see a brain drain of the country’s best and brightest across the Tasman where wages are higher, and a shift by entrepreneurial companies attracted by the new environment.

“I felt Australia had been falling back and needed to make some key changes, which is obviously what it is doing,” Joyce told BusinessDesk.

He said a number of the Australian initiatives were already in place in New Zealand, though in slightly different forms. But he said “it was not a race” between the two countries, despite them competing on global export markets.

“In the world of venture capital, start-ups and commercialisation, most of the players in Silicon Valley and elsewhere tend to see Australasia as an entity,” he said. “If Australia develops its science and innovation, that is good for all of us.”

He had little concern about researchers being lured across the Tasman, saying the Australian system of university funding was in a state of flux and the pressure on the federal government's books to close the fiscal gap was in contrast to that in New Zealand.

Joyce said New Zealand’s innovation policy was refreshed annually and had been in October. But he has officials monitoring a couple of the Australian measures with a view to introducing them here. He wouldn’t reveal what at this stage because people would then automatically assume they were "all go" rather than being tracked first to see how they pan out in Australia.

Ruth Richardson, former National minister and now chair of KiwiNet, said the government’s innovation policy needed to spend more on commercialisation pathways. That included the Pre-seed Accelerator Fund which funds researchers, who usually have little more than an idea, to establish if it’s worth taking to market, she said.

The first ever review of the $5.3 million fund this year found more publicly-funded science discoveries were being commercialised after a decade of government pre-seed investment but projects that could be commercially successfully were having to be rejected due to a lack of money.

Joyce said pre-seed was a possibility for further funding. “I have a case before me about that so if I can somehow loosen the purse strings with Bill (English), that’s up there on the list in terms of a priority area for more investment.”

While Turnbull’s innovation statement introduced new tax incentives for investors in start-ups, it also included a review of the generous research and development tax breaks, which critics have said often don’t meet the needs of earlier stage companies.

The National government axed the tax breaks introduced by Labour in New Zealand, opting instead for research and development grants which at the time made it an outlier among OECD countries.

Joyce said there was a general trend for OECD countries to have another look at the issue because tax breaks weren’t working so well with too many companies using it as a tax minimisation tool rather than as a genuine incentive to do more R&D.

The government’s R&D funding agency, Callaghan Innovation, last week announced changes to the grant eligibility criteria, including introducing a new clause stating applicants must not bring the organisation’s R&D grants programme or New Zealand’s reputation "into disrepute".

Joyce defended the inclusion of the clause which he said had been in place in New Zealand Trade & Enterprise funding contracts for some years, though “rarely used”.

When questioned whether the clause was too subjective, the minister said “I wanted to make sure the system is robust”.

(BusinessDesk receives funding from Callaghan to assist in the coverage of the commercialisation of innovation)

(BusinessDesk)

© Scoop Media