For good measure, let’s lop Callaghan Innovation’s admin costs, Taxpayers’ Union says

The eradication of Callaghan Innovation’s controversial Growth Grants in favour of a rules-based R&D tax incentive is a major victory for taxpayers, the New Zealand Taxpayers’ Union.

Taxpayers’ Union Executive Director Jordan Williams for years has been campaigning against these handouts to businesses hand-picked by Callaghan Innovation.

“Governments shouldn’t be in the business of picking winners – it rewards businesses for political connections rather than productivity, and it’s unfair on the winners’ competitors,” Mr Williams says.

“Despite countless examples of businesses receiving grants and then going bust (or being bought out from overseas), the National Government refused to accept criticism of Callaghan grants. On this issue, the Honorable Doctor Megan Woods has shown far better business sense than her National Party counterparts.”

With the primary function of Callaghan Innovation being phased out, the Taxpayers’ Union is pressing for a downsizing of the Callaghan Innovation organisation, which employs 386 staff with an average salary of $112,000.

It believes taxpayers could be saved up to $86 million a year in administration costs.

“An across-the-board tax incentive is a far tidier and less risky solution than gambling taxpayer money on a handful of fat grants to select businesses,” Mr Williams said.

But an even better solution – he argues – would be to simply reduce the corporate tax rate. That would avoid any boundary issues and risks of gaming of the new R&D credit.

The Taxpayers Union will be submitting to MBIE on these issues. weeks.”

Source: Taxpayers’ Union


Tax incentive paper: Nats accuse Govt of planning to cut support for business R&D

The Government’s first practical move in the science and technology sector is to reduce investment rather than increase it, National Party Research, Science and Innovation Spokesperson Parmjeet Parmar says.

She was commenting on the Government’s release of the Research and Development Tax Incentive Discussion Document for public consultation.

The discussion document is available on MBIE’s website HERE.  

It aims to stimulate feedback on a plan to allow qualifying companies to claim back 12.5 per cent of their spending on research and development.

Consultation is open until 1 June.

BusinessNZ has commented on the document (HERE) – it says the Government’s proposals could help raise company R&D investment overall – while the Science Media Centre has published expert reaction HERE.

Ms Parmar drew attention (HERE) to a proposal to cancel R&D growth grants at the same time as R&D tax credits are introduced (“hidden way down the back on page 31”).

Hundreds of New Zealand’s most innovative technology-focused companies will drop from getting 20 per cent of their research and development expenditure re-funded down to 12.5 per cent, she contends.

Start-ups making a loss may have to wait until they are making a profit to cash-in any tax credit, which could take years compared to the current system which provides grant funding immediately.

Ms Parmar says that the change from growth grants to R&D tax credits will also lead to a big boost in business for accountants.

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Urban-sprawl concerns raised in report which spotlights serious land-use issues

A report on the state of the country’s land has highlighted the impact of urban sprawl, the loss of important wetlands and emerging problems associated with soil compaction.

The Our land 2018 report, released by the Ministry for the Environment and Stats NZ today, confirms the need for more action to improve land management, Environment Minister David Parker says.

“I was particularly troubled by how much of our urban growth is occurring in our irreplaceable highly productive land.  Even in a country as lucky as New Zealand we only have limited quantities of these high-class soils,” he says.

Officials have been asked to start work on a National Policy Statement (NPS) for Versatile Land and High Class Soils to address issues such as the loss of prime market gardening land around Pukekohe, as Auckland expands, as well as the impact of lifestyle blocks on our most productive land.

“We have to ensure we have enough land to build the houses people need, but we must protect our most productive areas too.”

Another major concern was the finding that 44 per cent of sites tested had low macroporosity levels – in layperson’s language, that the soil was likely to be compacted.

“Healthy soil is like a sponge, full of holes that can absorb air and water. When it is compressed it can’t absorb water, which makes it more drought prone and nutrients are more likely to run off into waterways,” Mr Parker says.

The report is one of the most comprehensive yet on the state of New Zealand’s land.

“It brings together a range of issues such as soil erosion and quality, biodiversity, urban growth and waste. The connections between those issues and other aspects of the environment, such as our waterways and climate, are clear to see,” Mr Parker says.

The report found that New Zealand loses around 192 million tonnes of soil each year to erosion, of which 84 million is from pasture land.

Government, farmers and others with an interest in land have a role to play in better managing erosion-prone land.

“The Government’s billion trees planting programme, which focuses on the ‘right tree, right place, right time’ will help.

“The report also confirms the continued loss of our limited wetlands, which contain some of our most precious biodiversity, and filter contaminants from land. We must do more to protect these.”

Mr Parker has also asked officials to begin working on a more comprehensive freshwater national policy statement to address concerns about sediment, wetlands and estuaries.

He said the new report must spark a greater effort to build our knowledge of land, because there are significant data gaps which must be filled.

Source: Minister for the Environment

Lifting R&D investment: Govt releases tax incentive discussion document

Research, Science and Innovation Minister Megan Woods and Revenue Minister Stuart Nash today have released the Research and Development Tax Incentive Discussion Document for public consultation.

The Government is committed through its coalition agreement with New Zealand First to increasing business R&D expenditure to 2 per cent of GDP over 10 years, Ms Woods said in a press statement. The  consultation document is the first step being taken to achieve that goal.

New Zealand’s gross expenditure on R&D is 1.28 per cent of GDP – much lower than the OECD average of 2.38 per cent.

“Growing R&D is a key lever in diversifying the economy and creating new industries, businesses, and highly skilled jobs,” Ms Woods said.

“Sustained increases in government investment will be important, but we will also need to see an increasing contribution from the private sector, specifically in businesses undertaking R&D.

“That’s why we’re introducing an R&D tax incentive as a significant addition to the system of government support for New Zealand’s innovation system.”

Revenue Minister Stuart Nash says the R&D tax incentive will have broad reach across the economy and will enable businesses of all sizes to undertake R&D.

“An R&D tax incentive will offer a greater element of certainty to businesses,” he says.

“It will be a simpler process, and will open access to those that have either struggled to access support or have been shut out of the process in the past. The system should stand the test of time and give businesses the consistency and confidence they need to succeed.”

Establishing a tax incentive mechanism of this nature had to be done carefully, Mr Nash says.

The discussion document sets out the main design and technical features proposed for the R&D tax incentive.

Over the next six weeks, the Ministry of Business, Innovation and Employment, with support from Inland Revenue and Callaghan Innovation, will be seeking feedback on specific aspects of this proposal to ensure the R&D tax incentive is fit for purpose.

AgScience readers can visit MBIE’s website to read the R&D tax incentive discussion document and make a submission HERE. 

Source: Government press statement


New Zealand river water quality trends show cause for optimism

River water quality around New Zealand has improved significantly in the past decade, according to the latest National River Water Quality Trends (2007-2016) data released this week by Land, Air, Water Aotearoa.

For all river water quality parameters monitored over a 10 year period, more sites were improving than deteriorating.

This encouraging national picture has been welcomed by scientists and local government who say freshwater ecosystem management practices as likely contributing to the progress.

The data, recording the results from regular water quality monitoring carried out over the past 10 years, show the majority of the country’s rivers rate positively.

The information relates to nearly 1500 freshwater sites that are regularly monitored for water quality by regional or unitary councils.

Data are supplemented by the National Institute of Water and Atmospheric Research.

Trends analysis was led by Cawthron Institute Freshwater Group Manager and Ecologist, Dr Roger Young.

He described the overall picture as encouraging and said:

“Looking back from 2016 at a decade of data, for every monitored parameter, more sites showed evidence of improving water quality, than degrading.

“My hope is this could represent a turning point in New Zealand’s river health story.

“While this analysis gives us cause for optimism, water quality is just one indicator of river health and there is still more work to be done. While all parameters show there are more sites improving than degrading, there are still degrading sites for all parameters.

“In order to continue further improvements, we need to invest in freshwater ecosystem management, routine monitoring, and further research and innovation.”

The National River Water Quality Trends (2007\ – 2016) released by LAWA follows a similar 10 year analysis released in 2015 by National Institute of Water & Atmospheric Research (NIWA).

Compared with the 2015 report, a change in the trend of nitrogen is particularly noteworthy, with significant progress in the number of improving sites compared with the number that are deteriorating.

The trends are based on analysis of the comprehensive data that’s freely available on the LAWA website. Regular water quality monitoring by New Zealand’s Regional and Unitary Councils, supplemented with NIWA data, means there’s water quality info for nearly 1,500 sites.


The LAWA website (HERE) provides more detailed information about the health of rivers in 16 regions around the country.

Source: Land Air Water Aotearoa


Commercial Mycoplasma bovis test for farmers to apply is being developed

A commercial diagnostic tool, which will allow farmers to do their own testing for the cattle disease Mycoplasma bovis is being developed by a partnership comprising commercial laboratories, industry representatives and the Ministry for Primary Industries.

The tool will be released once sampling guidelines, a testing strategy, and possibly an accreditation programme have been developed – to ensure the test can be accurately applied and interpreted.

The ministry’s response director, Geoff Gwyn, said  the partnership had been working hard to provide practitioners and farmers with better diagnostic tests to assist in detecting the cattle disease on their farms since the discovery of Mycoplasma bovis in New Zealand last year.

“However, while testing options and solutions are becoming available, we have identified that interpreting a one-off test result, even at the herd level, in isolation to other factors, is challenging and carries an inherent risk for farmers when in isolation to other factors,” Mr Gwyn said.

“The tests currently available will lead to a significant number of farms being falsely identified as positive and farms that may be real positives being missed.

“That’s why we are developing robust processes, including a testing strategy and sampling guidelines, which may form part of an accreditation programme.”

The partnership behind the test programme includes representatives from NZ Veterinary Association, Beef and Lamb NZ, DairyNZ, Dairy Companies Association of NZ, Federated Farmers, AsureQuality, MilkTest NZ, Livestock Improvement Corporation, New Zealand Veterinary Pathology, SVS Laboratories, and Gribbles Veterinary Pathology.

The veterinary association’s chief veterinary officer, Helen Beattie, said the partnership was focused on helping farmers who were dealing with the many uncertainties around the disease.

“All parties in this partnership are acutely aware of the need for a robust on-farm solution for farmers who are concerned about Mycoplasma bovis. All parties are working urgently on developing this tool, and all the elements needed to support it.”

Any accreditation programme will likely not only consider test result, but also factors such as herd management, animal health, and record keeping (including NAIT records) – all of which will be used to inform farmers of the likely risk of Mycoplasma bovis in their herd.

The ministry is continuing to test milk from every dairy farm in New Zealand – a comprehensive programme that is nearly complete and is being implemented alongside extensive surveillance work to trace every possible movement of animals from infected farms.

“We acknowledge that some farmers may be disappointed they don’t have access to a commercial diagnostic tool now to give them some certainty about whether their animals, or animals they may be purchasing, carry the infection. However, it’s critically important that we don’t rush this – we have to get it right,” said Mr Gwyn.

More information about Mycoplasma bovis can be found HERE. 

Source: Ministry for Primary Industries

Government announces Interim Climate Change Committee

The Minister for Climate Change, James Shaw, has announced the membership of the Interim Climate Change Committee, which will begin work on how New Zealand transitions to a net zero emissions economy by 2050.

Work must start now on how sectors like agriculture might enter into the New Zealand Emissions Trading Scheme (NZETS), he said.

And planning must begin now for the transition to 100 per cent renewable electricity generation by 2035.

The Interim Climate Change Committee will undertake this work until the independent Climate Change Commission is established under the Zero Carbon Act in May next year.

The Interim Committee will consult with stakeholders and hand over its work and analysis to the commission, he said.

Mr Shaw said committee members have been chosen because of their expertise across key areas related to climate change: agriculture, agribusiness, climate change science and policy, resource economics and impacts, Te Tiriti o Waitangi, te reo me ona tikanga Māori and Māori interests, international competitiveness, and energy production and supply.

Dr David Prentice, the Interim Committee Chair, was most recently the managing director of infrastructure firm Opus International Consultants.

He led his company through the Global Financial Crisis and has a sound understanding of economics and international markets.

Lisa Tumahai, the Deputy Chair, has significant governance experience and is Kaiwhakahaere of Te Rūnanga o Ngāi Tahu. She is a person of significant mana and standing in the Māori community.

The other committee members are:

  • Dr Harry Clark, a New Zealand expert on agricultural greenhouse gas research;
  • Dr Keith Turner, former CEO of Meridian and professional director;
  • Dr Jan Wright, former Parliamentary Commissioner for the Environment;
  • Dr Suzi Kerr, an internationally renowned expert in the economics of climate change policy and emissions trading.

Source: Minister for Climate Change