24 January 2005

Hon Michael Cullen - Speech Mathematics in Industry Study Group

I am very pleased to open this year’s Mathematics in Industry Study Group. The Study Group is exactly the kind of cross-fertilisation between academia and industry that we need to sustain growth in our economy and to build a vigorous tertiary education system.

I would like to commend the leadership of Professor Graeme Wake and the work of his colleagues at Massey University in bringing this event together

It is a little known fact that I am the only New Zealand finance minister in history (and, I believe, the only New Zealand member of parliament) to have had a degree in mathematics. I would like to say that this training has been instrumental in achieving a series of strong fiscal surpluses in the last five years. However, the truth is that managing government expenditure and revenue is primarily an exercise in understanding and accounting for human behaviour, in which the hard sciences play something of a handmaid’s role.

However, it is certainly my ambition, when I retire, to attempt to develop a set of algorithms which explain mathematically the behaviour of ministers of the Crown and MPs in a parliamentary democracy. This work will have to compete with my ambition to undertake a detailed analysis of my golf swing, and I expect both of these endeavours will need to draw considerably on the mathematics of chaos theory if they are to come to any conclusion.

While my own academic career in mathematics took a turn towards social statistics and merged with the study of history, I see an important common principle in the approach of the Mathematics in Industry Study Group. That is the conviction that even the purest and most abstract forms of mathematical theory can shed light on real life problems, even if takes some time for that to occur.

After all what attracts most of us into the study of mathematics is the realisation that numbers explain things, be they natural phenomena such as the growth of plants, the swarming of insects or the changes in weather patterns, or aspects of the human environment such as the design of hard structures, the manipulation of chemistry or biology, the transmission of energy or the management of information.

Linking the advanced study of mathematics to the challenges of industry (the challenges of managing risk, streamlining production and creating new value) not only benefits industry and hence the community, but also provides fresh intellectual challenges to mathematicians and thereby extends the boundaries of the discipline.

I think this gives the lie to the kind of reductionist utilitarian view of academic endeavour, the view that says that research that has no immediate commercial application should not receive public funding. This is certainly not the approach that drives the government’s tertiary education and research policies.

We are certainly looking to foster a tertiary sector that is engaged with its community. We want to see tertiary institutions that provide education and training that is relevant to the needs and aspirations of students, and that is delivered in ways that aid their learning and fire their enthusiasm.

We expect tertiary institutions to show leadership in forming partnerships with industry, both in terms of fine tuning the kind of education programmes they provide so as to meet the long term skill needs of the economy, and in terms of building a portfolio of research that extends New Zealand’s reputation as a nation of innovators.

These are more than vague ambitions. For the past five years we have worked with the research community and the business community to develop a Growth and Innovation Framework which focuses resources on the ways in which new knowledge generates growth in the New Zealand economy, and on the key points in the value-chain where we need to build our capacity or to clear away roadblocks.

Alongside of this we have increased government expenditure on research, with a significant proportion of the new expenditure targeted to research partnerships involving key growth industries.

However, none of this alters our commitment to maintaining a strong tradition of liberal education within our tertiary system. We see academic freedom as an essential value, and want to sustain a system in which researchers are able to pursue knowledge for its own sake.

This commitment can be seen in the way we have increased public expenditure on scientific research year or year, and have created funding mechanisms that use public resources to attract more private resources into research partnerships. Looking ahead, we are increasing government’s investment in research by $212 million over the next four years. Again, a large portion of this increase has been targeted at research ventures involving CRIs and industries where public and private investment work hand in hand.

It is also reflected in the Performance-Based Research Fund, which rewards institutions which undertake research that is recognised as world-class, and scholars who are active and valued contributors to international networks of researchers.

What we don’t want is for the process to stop there. If we are to create a vibrant ‘knowledge economy’ then we need a more disciplined approach to the transmission and dissemination of knowledge. And as a small country, we one of those disciplines is to make strategic choices about where to focus our efforts so as to build on our competitive advantages and create strong and sustainable niche industries.

Inevitably this means change. One thing that has to go is the cherished myth of the amateur; the individual who retreats to the garden shed, constructs an unlikely piece of sophisticated equipment, and produces something world-beating. It is time we put this little romance to bed.

As management theorists like Peter Drucker and Peter Senge have argued, innovation is not an art; it is a set of disciplines that can be learned, practiced and taught.

With hindsight we can trace the history of the computer through three centuries, from the development of binary theory in the seventeenth century, Charles Babbage’s calculating machines in the 1820s and 1830s, the invention of the punchcard by Herman Hollerith in 1890, through Bertrand Russell and Alfred North Whitehead’s work on symbolic logic, the invention of the audion tube, the transistor, the microchip and so on. The question for us is: how can we speed up this process whereby advances in mathematics and technology are combined to create innovations that serve humanity and create wealth?

There is no law that requires new discoveries in mathematics to take three centuries to find practical applications.

A true knowledge economy needs more than just smart people. It depends upon the quality of relationships between those people, and a culture that supports the sharing of information and collaboration across disciplines.

These things do not arise spontaneously; they have to be consciously designed and created, and they need energetic people to drive them. The interests of all have to be understood and respected. Issues such as intellectual property need to be worked through, and common understandings are required around best practice collaboration. We need this kind of interchange to be a regular, ongoing activity, and not just a periodic one.

The Mathematics in Industry Study Group is an excellent example of collaboration between academics and industry. Over the next few days you will take part in an extended process of intellectual ‘fermentation’.

This not only provides an opportunity to dig deep into the underlying causes of the problems you will consider. It also builds the kind of relationships that assist better transmission of new research into industry and guide future research. And it enables you to explore questions that may at first seem tangential, but which may lead to new discoveries, or at least to new questions and problems that deserve attention in the future.

Reading the feedback from previous study groups, the over-riding theme is one of surprise at how valuable the process can be. I trust that this year’s experience will be the same.

This is the kind of endeavour that signals where New Zealand businesses should be heading in terms of harnessing technology to increase value, and of what New Zealand universities should be doing to engage with business.

My chief regret in opening this event is that my schedule does not allow me to stay and witness the proceedings.

Thank you.

ENDS

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