Kiwinet Research Commercialisation Awards

Tēnā koutou katoa.

Thank you for inviting me to speak tonight at the 2018 KiwiNet Commercialisation Awards.

First, I would like to acknowledge Ruth Richardson, Chair of KiwiNet since inception. In August, Ruth will retire as Chair, after ten years of service in this role. Ruth has built KiwiNet up over the years to the success it is today. Thank you Ruth for your work in this important area.

KiwiNet fills a critical gap between public research organisations and the private sector, to strengthen commercialisation and collaboration on research, science and innovation in New Zealand.

KiwiNet is helping New Zealand move towards a globally-competitive technology sector and create a dynamic innovative economy. Tonight’s KiwiNet awards are a chance to recognise the incredible talent and success of New Zealand’s innovators.

All twelve finalists are outstanding examples of scientific commercialisation that is delivering a real-world impact.  These innovations are providing the solutions to the challenges that we face, including climate change, energy security, health and well-being and environmental sustainability.

This is what I want to talk more about tonight - the role of research, science and innovation in addressing the ambitious goals this Government has set.

By 2027, I would like New Zealand to be known as a global innovation hub, a world-class generator of new ideas for a sustainable and productive future.

We have a vision for a better New Zealand for all – where we have affordable, healthy homes; fulfilling jobs and high household incomes; an environment we can be proud to leave to future generations; and where we’ve built a diverse, sustainable and productive economy that delivers for our people. On top of that we want New Zealand homes and businesses to be powered by 100% renewable energy by 2035, and by 2050 we want to have net zero greenhouse gas emissions.

This vision can’t be delivered with the same old approaches. We need new ideas, new innovations, and new ways of looking at the world. This is where science and innovation comes in.

This Government understands that innovation is the driving force behind economic development, which is why we have invested over one billion dollars in the Research and Development tax incentive in Budget 2018. This will help to build an inclusive, adaptive and resilient economy, underpinned by science and innovation.

By leveraging new knowledge, and by introducing new products, processes and services, we can reduce our emissions, preserve and protect our environment, create fulfilling, high-value jobs, and improve wellbeing. Through research, science and innovation we have the ability to meet our targets. 

This is why our goal of lifting New Zealand’s spending on R&D to two per cent of GDP is so important, and is a key component to driving the change we need to meet our ambitious goals.

Currently New Zealand’s gross expenditure on R&D is 1.3 per cent of GDP, well below the OECD average of 2.4 per cent.  Our two per cent goal is ambitious from our current position, but modest by international standards.

And while our research and innovation system is dynamic, and boasts some notable strengths and successes it is small by international standards.

Creating our desired future means changing the share of our country’s collective resources that are dedicated to research and innovation.

We have already committed to developing an R&D tax incentive with the aim of lifting private sector R&D to assist towards our two per cent goal. At over $1 billion over four years, this is the largest ever new appropriation for Research, Science and Innovation, and lays the foundations for the further action we need to take.

But two per cent will not be achieved through public investment alone. Increased private investment in research and innovation will also be important to diversify our economy, and encourage new industries and companies to innovate.

Supporting all of our goals for New Zealand will require underpinning research, science and innovation activity which is confident, agile and world-leading.

Our progress towards our goals must be focused and systematic.

A structured pathway to achieving the two per cent goal will allow us to leverage the opportunities from our increased R&D activity to achieve our broader objectives for the environment, for society and for the economy. The scale and nature of the challenges in front of us demand a determined, strategic approach.

I intend to focus on the elements that we know are important for research and innovation.

As I’ve mentioned the introduction of a broad-based R&D tax incentive will lift New Zealand business investment in R&D over time. But there are other things we can do to lift performance.

We need to support and grow a thriving start-up system. Start-ups often introduce more radical, disruptive innovations than more established firms.  Highly novel innovations will disrupt markets, organisational structures and operating processes. They are the way New Zealand will develop unique, world-first and ground-breaking ideas.

Through our consultation for the R&D tax incentive we have listened to the start-up sector – and we recognise the importance of this segment of our innovation ecosystem.

The policy issues involved in including pre-profit businesses and start-ups in the tax incentive are complex, which is why we’ve allowed another year to identify the right support for this group. 

Innovation also depends on blue-skies, and world-class research.  We face a variety of pressing problems for which we currently have no immediate and clear solution such as mitigating the rise of superbacteria or understanding how automation will change society. 

It is through discovery research, where there is a high level of uncertainty or novelty that ‘new to world’ innovations are most likely to be generated. 

Government plays a key role in discovery science as it is the principal investor. I intend to maintain this focus on excellence and impact of our research, and continue to grow our investment.

New Zealand is geographically isolated from many of it’s trading partners. For us to compete, we need to attract and partner with international R&D and talent to connect our research to the world. This will also help us access wider markets, and enable us to scale up.

Our Innovative Partnerships programme, through the Ministry of Business, Innovation and Employment, is an important means of achieving this, and I intend to continue a focus in this area.

And as most of you in this room will know, it is through public research organisations collaborating with industry and end-users that knowledge is commercialised. 

KiwiNet and the Commercialisation Partner Network play a critical role in this area. New Zealand has excellent ideas and research – and by commercialising and translating these into practical applications we can realise the full benefits of this work.  I want to continue to build strong connections for knowledge transfer and commercialisation – great example of this are being recognised tonight.

Our public science happens in our universities and Crown Research Institutes, and is supported by infrastructure of equipment, connectivity, databases and platforms of knowledge. Continuing to ensure that these structures and their governing funding and incentives are fit-for-purpose is essential.

For a country our size, it is important we focus our effort.  We can’t do everything, and need to think carefully where our advantages lie and how we offer that to the world.

While we are known as a destination for certain fields and have traditional strengths, we can better focus our efforts by refining our value proposition to hone in on a few key areas of competitive advantage.

Over the coming months, I want to think and consult about what these areas might be. For example, there are some areas where New Zealand does have obvious advantages:

  • Our strong agricultural base has meant we have developed niche strengths in protein research and bio-discovery. We can leverage these strengths as the world faces disruption in future farming and food production. Agri-tech offers huge potential for delivering more productive and sustainable land use.
  • Building on this, the Government has set aside $57 million over the next four years for joint research programmes in data science and future food science, supporting delivery of a new bilateral ‘Enhanced Partnership’ with Singapore. Developing advanced data and computational science can help underpin our dynamic IT sector, as well as enabling new industry development.
  • Who would have thought that New Zealand would one day be a space faring nation? Rocket Lab’s presence in New Zealand provides us with an opportunity to position New Zealand as a hub for ‘new space’ activities.
  • New Zealand also has some significant international impact in its health research. We have world firsts in knowledge and clinical care in perinatal science, asthma, medicinal chemistry and neuroscience, amongst others. And there are small but growing medical technology and generic drugs sectors.  I consider there to be enormous opportunities to build our expertise in these fields.

It is through research, science and innovation that we will meet our targets, and invest in New Zealand’s future.  A future that looks after our children, that creates rewarding employment opportunities, that protects our environmental and social well-being, and transitions us to carbon-neutrality.

You are the drivers for this change.  You are the innovative businesses, you are the researchers and scientists, and you are the investors and risk-takers.

I look forward to working with all of you to build this future.