Research and development spend increase not good enough, manufacturer says
Thursday, 30 March 2017
Businesses have spent an extra 29 per cent on research and development since 2014 but the government put five per cent more money towards its own innovation, a recent report revealed.
New Zealand spent $3.2 billion on research and development in the past two years, 20 per cent more than between 2012 and 2014, Statistic New Zealand's Research and Development Survey 2016 found.
$1.6b was spent by businesses. $176 millon of their spend was funded by the government.
The government remained the smallest spending sector putting $32 million towards its own primary industry and environmental research.
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Higher education such as universities spent another $143m.
Manufacturing became the highest spending industry of more than $600 million. This showed a change in fashion after decreasing their spend in 2012 to 2014.
The computer services industry made the biggest expenditure lift of 40 per cent.
The results suggested good progress towards a diverse and resilient economy, the Ministry of Business, Innovation and Employment said.
Chief executive of export tool manufacturing company Mastip, Marc Michel, said the results were a 'sad story' for New Zealand despite businesses billion dollar commitment.
Michel said the government's financial input was insufficient.
'We are not having the right conversations around R and D,' he said.
New Zealand was ranked 28th in the Organisation for Economic Cooperation and Development for research and development spend as a portion of gross domestic product. Australia was ranked 14th.
Michel said he did not accept that position regardless of the size and distance of New Zealand.
'We are in a competition globally,' he said.
'Having the 28th best spend is not going to get us near the podium.'
Michel became the boss of Mastip in February 2016 to bring it up to date with global manufacturers, he said.
'My mandate when I came in was to drag the company kicking and screaming into the 21st century.'
Before his arrival, Mastip had spent about $140,000 on research and development over the past four to five years, Michel said.
After a $500,000 investment round, Michel is working with Auckland University to research how nano particle technology could increase the wear resistance and life span of Mastip's manufacturing tools, he said.
If Mastip did not commit to innovation, it would not stay in business, he said.