Thank you for inviting me to speak at this Mid-Winter Dialogue series.

As Minister of Research, Science and Technology, with responsibilities for the Health Research Council, it will come as no surprise that I will be focusing most of my remarks on health research, and the insight it provides in the wider research, science and technology sector. 

The public funding of health research encapsulates many of the issues facing the research, science and technology sector, including the priorities and effectiveness of the system.

Today I will start by discussing first my plans for the research, science and technology system in New Zealand and the increased investments the Government has made in health research.  Second, I will talk about measuring impact from health research and the role of health technology in the economy. Third, I will talk about some of the developments the Health Research Council is progressing. 

Setting clear research, science and technology objectives

Most of you will know that on Wednesday I gave a speech in Wellington, outlining the strategic changes I wish to bring to the science system. There are four improvements I am working towards:

• enhancing the migration of science from the laboratory to the marketplace


• improving the way we strategically invest in the public-good science that underpins our economy


• directly boosting economic growth through more effective market-driven research


• simplifying the entire system.

These actions come from the meetings and discussions I have had since becoming Minister. They take account of views from universities, CRIs, businesses, investors and others in the research sector.

This morning I was in Wellington talking to researchers and senior management from the higher education sector.  One of the challenges I laid out for them is to ensure the research our universities and CRIs undertake makes a greater contribution to the growth of New Zealand companies.  Health research should - and does - play a role there too.

The Health Research Council is simplifying their application processes, as are FRST and the Marsden Fund. It is not my intention to significantly change the HRC or what it currently funds - in fact, the Minister of Health will still set HRC priorities. But the changes the Government will make to other aspects of the sector will boost the impact of health research in New Zealand.

New funds for health research

The importance the Government places on health research is reflected in the additional $8 million per year to the Health Research Council in this year's Budget. That is, a 13% increase to $71 million per year.  This is a generous increase given the current fiscal climate.

It was one of several commitments in research, science and technology funding this Government had signalled pre-election and which we delivered through the Budget. We also increased the Marsden Fund by 24%, which has some cross-over with health research, and increased the CRI Capability Fund by 20%.

As well as the Budget commitments, you can also look to the appointment of Professor Sir Peter Gluckman as Chief Science Adviser to the Prime Minister. So both through the Budget, and through other policies such as the Chief Science Adviser, we fulfilled commitments that we made during the election campaign.

The balance across fundamental and applied research is at the heart of the science debate. The new investment in health research will support fundamental research, as well as more applied research. This is not just a question for health research, but for the Government's investment in all research, science and technology.

The Government recognises that health research is measured primarily by how it improves the health of individuals and populations. However, it also benefits the physical and economic health of society. Health research is a partnership with the New Zealand health system. It does have high costs and it constantly requires new capability.

My colleague, Hon Tony Ryall, spoke here last week, and I understand talked about how the right workforce and the right environment are needed for good healthcare. One of the points he made was that research plays a role in creative, innovative healthcare, and these are the kinds of workplaces we want to develop.

It is also vital that we recognise that New Zealand's health science fits into a world of health research. By maintaining excellent and well-connected teams, we can link into health science globally, and bring improvements to New Zealand's health in this way.

So in the $8 million increase, I instructed the Health Research Council that $3.5 million of the new funds must sustain and support New Zealand's excellent health research teams and their contributions to new knowledge, teaching and links with international science teams.

The other $4.5 million of the research will be focused more directly on improving New Zealanders' health and the health system. This is inevitably more population focused. It means we can respond to some of the pressing health issues we face in New Zealand, such as diabetes and respiratory diseases.  The funds will also support the new Health Research Council investment stream to develop innovative models of care and improve productivity in health and disability services. 

In Canterbury, there are strong local trusts and foundations who take great pride in supporting health research. Funding from sources such as the Christchurch Medical Research Foundation and the Canterbury Community Trust can substantially leverage the government investments in health research, and generate wider goodwill within the region. Other national organisations, such as the Cancer Society, provide further community support for health research.

The intent of our commitment is a clear demonstration of the commitment to research. It is vital that we maximise this backing - primarily for health outcomes.  However, we also gain economic outcomes as well; in particular the partnership of medical research with pharmaceutical and other health firms in the development of new drugs and new medical technology.

Impact from health research

This leads into the second issue, of the impact of health and its link to the economy. New Zealand has to take particular care to get the best value out of its research effort. Unlike larger, more developed countries, we have less capacity to make funding mistakes. As Lord Rutherford noted "We've got no money, so we've got to think". Yet like other larger countries we have to run a sophisticated health system that is able to meet public expectations.

I recently visited Singapore and toured some of their science facilities, including the impressive Biopolis biomedical science park. It is sobering to know that Singapore has a similar population size to us, but clearly we don't have the same outcomes, at least with respect to economic performance. New Zealand is not Singapore, but we can draw some lessons.

We know that we produce high-quality health research in New Zealand.  In fact, using the traditional academic measures of research quality, we are doing very well. But we need to think well beyond impact as measured by publications and citations.

The Prime Minister's Chief Science Adviser, Professor Sir Peter Gluckman, talked about impact in his inaugural speech last month.  He posed the challenge to the science community to really ask and answer questions such as "what is the purpose of science?", "what does it achieve?" and "why should we bother to invest in science?"

Health research makes impacts with new knowledge about health conditions, evidence supporting better clinical decisions and new medicines and services.

A good example is the Cardio-endocrine Research Group here at the University of Otago.  Led by Professor Mark Richards, and built up over 20 years, their capability covers disciplines from "bench to bedside". The main focus is on improving prediction and protection in heart disease.

Their work has resulted in cardiac peptide blood tests becoming standard practice worldwide for heart failure. This speeds diagnosis, reduces hospital stays and saves healthcare costs.

Their international connections and reputation also put them, and New Zealand, on the world stage and provide access to international expertise in other health research disciplines far beyond what we have here.

Health research also has a positive impact on the training, professional development, recruitment, and retention of health professionals. As Associate Tertiary Education Minister, this link between research and training is of particular interest to me. Minister Ryall has also expressed an interest in research that contributes to a more skilled and productive health workforce. 

Health research also supports economic outcomes. Delivering cost-effective healthcare supports a healthy and long-lived labour workforce. Research in health should lead directly to a more productive society and economy.

Health research also leads to new business opportunities. There are some well-known success stories in New Zealand, such as Fisher & Paykel Healthcare, and Orion Health. A significant proportion of the TIN100 Group of innovative companies are in the health sector.

Here in Christchurch, having the University of Otago campus on the hospital site means your researchers work in close proximity to the doctors, nurses and managers that can provide links to research direction and application. 

The Crown Research Institutes ESR and IRL also have a presence in Christchurch, working in areas such as public health, health systems, disability and rehabilitation technologies.  The University of Canterbury has complementary strengths in engineering and information technology.

Having this mix of CRIs and universities assists a more coordinated approach to working with companies and the DHB. This collaborative approach is a key to getting the most benefit from limited resources.

I am looking forward this afternoon to meeting the bioengineering team and learning more about the MARS CT scanner that you are developing here in Christchurch.

Health technology

One area where health research translates into business growth is in health technology.

Earlier I mentioned the TIN100 report that provides an analysis of 100 of New Zealand's leading technology businesses.  The 2008 report gives us a view of how these companies are managing in the current economic climate.

The report is particularly valuable in the way it highlights companies that are resilient even in today's economic environment.  Common features include continuing and deep investment in research and development, technology leadership, a focus on cost efficiencies and cost, and unrivalled quality.

These more resilient companies include high-tech health-focused businesses such as Orion Health (New Zealand's largest software exporter), Fisher & Paykel Healthcare, and Douglas Pharmaceuticals.  The list also includes smaller businesses such as Intrahealth and MedTech Global. 

Christchurch has a number of smaller companies and start-up businesses, many of which have their origins in New Zealand science labs.  These include Veritide, ARANZ, Dynamic Controls, and IZON. Their capacity for growth will drive the New Zealand economy up the value path.

Emendo, a local health IT company, recently won a UK award for its CapPlan health workforce planning solution that has been implemented by Bedford Hospital in the United Kingdom. This is saving them £600,000 annually.

The Canterbury DHB helped with product development and acted as a reference site supporting Emendo's growth.  In return the Canterbury DHB is saving millions of dollars, through being better able to anticipate demand for beds and match staffing.

The success of Emendo and other companies show that impact from health research and technology can be measured both in better health for New Zealanders, and in greater opportunities for health research and its impact on economic opportunity.

The same type of enterprise is shown by the work the Canterbury Development Corporation (CDC) is doing in partnership with the Canterbury DHB on a Health Innovation Hub.  This is a visionary initiative that grasps the opportunity to bring together the interests of firms and the DHB. 

It has the potential to deliver for firms, improved hospital performance targets, patient and health outcomes, and workforce retention. These are the goals that health research clearly needs to have.

HRC developments

The third issue I will discuss today is some important changes the Health Research Council is introducing over the next few years, particularly around simplification and strategy. This is part of a broader objective across Vote RS&T.

The HRC, like all research, science and technology funding agencies, is currently working to simplify their funding process. You will all know how there are many more bids submitted to the HRC than it can possibly fund, and you will also know the frustration of the time involved in preparing a bid, especially when you are not successful. 

These are inefficiencies we can't afford to have in the system.  I have been clear to both the HRC and the Foundation that we cannot afford the overly contestable system we currently have, and that there need to be changes.

The HRC for its part is moving to a two-stage application process to help reduce transaction costs, and it is also working with other funding providers to simplify the application process, for example through use of more on-line processes and use of a common CV template.

The HRC is also moving towards more targeted investments.

The new system will have investment priorities, each with a set budget.  There will also be extended assessing committees that represent both the science perspective and other stakeholders who might use the new knowledge. 

The HRC Board is phasing this new system in gradually.  It will be focused on goals that can be realised in the short to medium term, generally within five years.  It will provide new opportunities for clinicians and healthcare teams to engage in research. It will also encourage those research teams to tap into the wider of science talent, for example our engineers and IT specialists. 

I expect this new fund to both drive improvements in hospital services and support prevention initiatives in our communities. 

Next week the HRC are starting a series of meetings to explain their new process.  They will be in Christchurch on 26 August, speaking in this same lecture hall, and I encourage you to attend.

Closing remarks

In closing, I want to acknowledge the dedication and skill you bring to your work on this campus and the impact this has on your local community, your international peers, and everyday New Zealanders. 

I also want to acknowledge the strong partnership you have with the Canterbury DHB, particularly here at the hospital.  Partnerships like this will enhance quality health research.

Health research is central to achieving the Government's ambition of building New Zealand's social and economic future.

Your role in building this culture places at you at the forefront of these goals.