Government still wants profitable science

By Peter Griffin 29/03/2010

There has been a whirlwind of activity in the science sector with the Government turning around its feedback on the CRI Taskforce report in the space of three weeks and setting out its plan to implement most if not all of the recommendations.

The Government response to the taskforce report is below. The bulk of the report gets the endorsement of the Minister of Research, Science and Technology, Dr Wayne Mapp, Minister of Finance Bill English as well as MoRST and treasury officials. But there are a few sticking points and not surprisingly, they both involve money.

Writes Dr Mapp on sticky point number 1:

The Minister of Finance and I have concerns about bringing together science policy, funding and monitoring into a single agency (Recommendation 25 of the report, paragraph 17 of this paper). We suggest institutional arrangements in science are addressed through the ongoing machinery of government review processes currently being undertaken by central agencies.

Treasury weighs in on this, which it considers “potentially the most contentious” of the CRI Taskforce recommendations:

We agree that it would make sense to combine policy, long-term funding (as we consider that long-term funding can be considered ‘equity-like’ with strong links to ownership matters), and non-financial monitoring. This would reduce fragmentation in science policy which is a recognised problem.

We agree COMU should provide financial and Board appointment expertise, as they do for all Crown companies. Treasury would recommend Ministers consider whether contestable funding should remain in a separate agency. This would ensure the contestable funding body stayed independent from CRIs providing a more level playing field across public and private research organisations, and some checks and balances on the combined RS&T entity. We note that machinery of government options will be considered as part of SSC’s machinery of government process.

If scientists and their managers are stressed by the ever-constant nine per cent rate of return required of CRIs, they shouldn’t expect a return on investment target to disappear entirely, despite the less profit-driven aims the CRI Taskforce advocates. Writes Dr Mapp on sticky point no. 2:

We also have concerns about abandoning a return on equity as a performance measure. As a general rule, those CRIs with a clear sense of mission are also financially sustainable. A proper financial objective is an important measure of performance.

Treasury for its part questions whether knowledge transfer between the public and private sector will be adversely impacted if the CRIs are ordered to stay out of commercialisation activities:

Treasury has some concern that if Government is to actively discourage CRIs from investing in commercialisation, this might in some instances limit legitimate options for transferring knowledge.

Some tricky issues to sort out then, but overall, a government largely in agreement with a taskforce it has created, which can’t be said of all the taskforces that have recently reported!

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