Looking For Funds

It's raining funds. Have you noticed? By one count there are at least 32 individual government funds available to encourage innovation at various stages from, basic/underpinning research to development of new business ideas. Below this article is a list of the funds available. Cut this list out, because you won't find it on any government site, but this is how the government allocates the $826 million that it has earmarked for innovation.

It's quite a list, and if the funding is placed along a spectrum stretching from basic research (bottom of the list) to application/exploitation (top of list), we can see that New Zealand has a comprehensive coverage of most steps along the way. A couple of years ago it wasn't like that. We had about 17 funds instead of today's 32, and funding was concentrated in the middle of the spectrum to produce a hump, or "n" shape. Since then, government has taken some hesitant steps to increase funding at either end of the spectrum by putting relatively more money into graduate and underpinning research, and more into applied research and technology at the business end of the spectrum.

Other countries start from different points. Ireland, for example, has the same policy aim as New Zealand to reach 0.8% of GDP in government RS&T funding - but is doing it by pumping up the middle of the spectrum. They have just invented a PGSF look-alike because they started from a u-shaped curve with a great deal of investment in education, huge amounts in technology, and not much in mission-orientated research.

Last year New Zealand saw one of the bigger budget increases for RS&T in some years, but we still have some way to go. Much more could be done to increase underpinning research and to boost technology in New Zealand.

So things are improving. We should have no cause for complaint. Well, it may seem niggling, but there are two. Firstly, very little of the funding is actually available this year. The vast proportion of it is tied up in long-term contracts. That is excellent for stability, but not so good for new initiatives.

Secondly, we have too many funds trying to do very similar things. If governments introduce a new idea, there is a tendency to set it up as something new, and brand it with their own image, rather than roll new funding into an existing scheme. A couple of years ago we saw Enterprise Scholarships, Top Achiever Scholarships and the New Economy Research Fund. Last year we saw Grants for Private Sector Research and Development. This year we are likely to see a new Seed Capital fund, and Centres of Excellence.

The problems are these. Each new fund is too small. Each has its own application form. The time costs to an applicant are daunting. In trying to carve out a niche so that each new fund doesn't trip over its neighbours, rules become highly prescriptive and difficult to follow. Every now and then New Zealand should pause and clean up the shop. It is already clear that there should be rationalisation of several of these small funds. There is a maxim in policy circles that for every policy goal you need at least one policy instrument (eg. funding programme), but do we really have so many policy goals that we need 32 programmes?

[By Royal Society CEO, Steve Thompson]

Funds for Research and Innovation in New Zealand:

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