If the government wants science to have an economic impact it has to put its money where its mouth is

Billed as the most significant change to the science system in 30 years, last week’s announcement of major structural changes to scientific research institutions was objectively a big deal.

But the devil will be in the details. The proposed reforms are focused on the economic impact of the science sector and are based on the first of two reports from the Science System Advisory Group (SSAG).

Success will depend on how they are implemented and, most of all, on the sector receiving sufficient funding.

The government’s reforms include:

• the merger of seven public Crown Research Institutes to create three larger Public Research Organisations (PROs)

• the creation of a fourth new PRO focused on “advanced technology” such as artificial intelligence, synthetic biology and potentially cleantech

• the disestablishment of Callaghan Innovation and the creation of a new agency called “Invest New Zealand” to target international investment

• the creation of a new national intellectual property policy, meaning scientists working in PROs and in the university system are on a level playing field when it comes to commercialisation

• the establishment of a Prime Minister’s Science, Innovation and Technology Advisory Council to provide strategic direction and oversight.

As the reforms move forward, the government will have to answer several questions. For example, how will the expertise relating to advanced technologies, much of which currently sits within our university sector, be moved into the new PRO?

And how will the funding model be changed as these new PROs are established?

Long running issues

Overall, the higher level changes are positive. Reforms have been a long time coming and are based on years of discussion within the crown research sector.

But we need to look at the reforms in the context of the science advisory group’s first report.

The report is strongly and deliberately focused on the potential economic impact of science and research. The authors outline how this must be supported by a properly functioning system.

According to the authors, a lack of strategy from the highest level of government is a barrier for the sector.

It is clear the advisory group recommends structural change (such as the PRO model). But it is also explicit that sufficient research funding is a necessary condition for these reforms to work:

The SSAG stands firmly of the view that our parsimonious attitude to research funding is a core reason that New Zealand has become an outlier in performance on productivity growth.

Barriers to progress

The advisory group identified certain cultural attitudes, such as New Zealand’s “number-eight wire” thinking, as a reason the country doesn’t value research as it should. The group also strongly advocated for bipartisan agreement on funding systems and investment levels.

The group had strongly positive things to say about research in the social sciences and mātauranga Māori through the lens of economic growth.

There is no debate that research into Māori culture and knowledge is an obligation of the New Zealand research system and that this should be largely determined by experts in mātauranga Māori. We will be recommending a distinct funding stream in the proposed National Research Foundation.

Unfortunately, this government’s defunding of the social sciences and humanities, announced in December, suggests it has already made its mind up on the value of these disciplines.

Missing the bigger picture

Reading the full report, there is the sense that while the government announcement has taken the most visible recommendations for change, it has missed the bigger picture: the need for sufficient funding to strengthen the sector as a whole and help New Zealand become internationally competitive.

This means we need to benchmark ourselves against other countries and their economic and scientific performance. According to the report:

The international analysis is clear: we are spending significantly less than comparable countries spend from the public purse on [research and development].

The authors emphasise that for countries with low expenditure, improved research and development activity is especially important for GDP growth. New Zealand should take note – it is an outlier both as a low investor and a poor economic performer.

These messages are not new.

Steven Joyce, science minister in the National-led government between 2011 and 2016, advocated for the National Science Challenges as a way to justify increased government investment to the sector. But issues with the implementation costs effectively killed off his promise of increased funding.

Labour’s science minister between 2022 and 2023, Ayesha Verrall, had a similar argument about needing to establish research “priorities” in order to justify increased spending. Again, it never happened.

It is possible the current reforms will be more effective in providing justification for increased investment.

But this time we need to put the horse before the cart by investing money in the system – one that has been underfunded for years and which has only recently seen further funding cuts and job losses.

And this has to happen before the system absorbs the implementation costs of these reforms.