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

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Budget 2017 provides an extra $74.6m to further grow business R&D

Science and Innovation Minister Paul Goldsmith has announced an additional $74.6 million in funding through the Innovative New Zealand programme in Budget 2017 to meet the growing demand for Callaghan Innovation’s research and development Growth Grants.

The additional funding means a total of $657.2 million is now available over four years through the Growth Grants programme.

The new funding follows on from the $761.4 million investment in Budget 2016 through the Innovative New Zealand package and continuing investment in science and innovation over recent years.

New data released earlier this year by Statistics New Zealand showed a significant increase in the sums Kiwi companies are spending on R&D. In the two years to 2016 business R&D increased by 29 per cent and Callaghan Innovation grant recipients increased their own R&D spending by 46 per cent.

Growth Grants were designed to provide a predictable, rules-based platform for businesses to increase their investment in R&D and encourages the development of a strong business R&D ecosystem in New Zealand.

Another $59m in R&D grants to grow firms faster awarded by Callaghan Innovation

Research & Development Growth Grants worth $59 million over three years have been awarded to 19 more high tech New Zealand businesses by Callaghan Innovation.

R&D Growth Grants were introduced last year as part of changes to R&D funding designed to encourage more research and development to be undertaken by businesses in New Zealand. They provide up to $5 million co-funding a year to mid-sized and large New Zealand-based companies that are experienced in doing R&D.

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