Tuesday, 30 September 2014

Research and Development growth in the right direction

In this week's Hutt News the editorial seems to make the case (again) for R&D tax credits - as opposed to National's policy of expanding grants through the likes of MBIE and the Hutt Valley's Callaghan Innovation.

The editorial argues that private enterprise investment in R&D is relatively low in New Zealand, and this is harming New Zealand's economy long-term as our businesses aren't adding as much value to our exports as we could. This is a concern the government shares.

Through initiatives such as Callaghan Innovation and new forms of company incubators, business investment in R&D has greatly expanded. According to Statistics NZ's Survey of Research and Development, overall expenditure on R&D has grown by 23% since 2008 to $2.6 billion. Critically, private sector expenditure has grown by 31% over the same period to $1.2 billion.

This is an excellent trend in the right direction, but more needs to be done. We still lag behind other small economies in terms of the percentage of our GDP spent on R&D. Despite the recent growth we've experienced, our total spend is 1.27% of GDP, versus the OECD average of 2.38%. We're heading in the right direction but it is critical for New Zealand's future that we continue on this path.

Spending on R&D by sector, 2008 - 2012:

 $ million  2008 2010 2012 % change
 Private sector   $       913  $       971  $     1,193 31%
 Government   $       584  $       615  $       596 2%
 Universities   $       643  $       802  $       836 30%
 Total   $     2,140  $     2,388  $     2,625 23%

Monday, 29 September 2014

Waitangi National Trust charges for the Treaty Grounds

Newly elected Te Tai Tokerau MP Kelvin Davis thinks that the $15 fee for New Zealanders to visit the Treaty Grounds at Waitangi is "outrageous". I agree - like Te Papa, New Zealanders should be able to visit the Treaty grounds for free.

Overseas visitors pay $25 to visit. When my wife Jen and I visited the Treaty Grounds back in 2008, it was free for New Zealanders. We only had to show our drivers licenses to get in. From Saturday we would have to pay the $15. In its defence, the Trust that owns and operates the Treaty Grounds (the Waitangi National Trust) points out that it receives no government funding, and international tourist numbers have dropped as a result of the global financial crisis.

According to its 2013 annual report (from the Charities website), the Trust brought in $1.998m from ticket sales, tours and events at the grounds. There were small grants totaling $34,500 and interest and dividends of $427,000 for a total income of . That year, 100,000 people visited the grounds, 55% domestic and 45% international. The Trust made a loss of $298,835 for the 2013 year.

Extrapolating this out, assuming that the same number of people choose to visit the grounds regardless of the price, and that of the 55,000 domestic visitors at least half are adults, you'd net $412,500 in ticket sales at $15 a pop. The Trust would return to surplus with $114,000 to play with.

Grant Robertson and the Waitakere man

Labour leadership contender Grant Robertson states that he wants to be judged on his policies, not his sexuality. Fair enough - most Kiwis wouldn't care about his sexuality either. The oft asked rhetorical question "are we ready for a Gay Prime Minister?" - which the news media have asked us since the 2013 leadership contest - is really nonsense. The Waitakere man - the mythical creation of commentator Christ Trotter, the voting demographic who allegedly would take issue with Grant's sexuality - cares more about the pay in his pocket than the Prime Minister's sexuality.

In my view, Grant's main problem is his policies, not his sexuality. For the Waitakere man, who by Trotter's definition most likely owns his own small business (the "man with a white van"), policies such as a capital gains tax, increasing the minimum wage at a rate they can't afford to pay their staff, and compulsory variable KiwiSaver contributions are what make Grant (and Labour generally) an unattractive prospect.

Friday, 26 September 2014

If solar energy is booming, why does it need subsidies?

Solar uptake in New Zealand. Source
I discovered on the campaign trail that quite a lot of politics these days is simply picking a winning trend, crafting a policy that sounds like you're doing a lot to make that trend happen, then taking credit for what's already happened.

That's the Greens solar energy policies in a nutshell. The other day Gareth Hughes claimed "National eclipsed on solar energy", (ignoring the work done by the government in aid projects across the Pacific) pointing to a report recently by Otago University which shows that the take-up of small scale photovoltaic (PV) cell systems in New Zealand is up 330% in the last two years.

This is great news and a winning trend for New Zealand. The report notes that this increase is in absence of government subsidies for PV installations, which is what the Greens propose.

The report concludes:
This level of interest currently exists with no support from the Government via subsidies and feed - in tariffs, and mostly under business models that require a large upfront investment. New types of business model such as that currently being trialled by Vector may remove some significant barriers to entry and increase the level of interest in installing PV.
Vector is running a lease based system in Auckland, which apparently has strong uptake. Which begs the question: why does solar need subsidies? If uptake is to continue at this rate, will subsidies actually accelerate the trend or simply be pocketed by people who are going to install solar systems anyway? The report doesn't go into these questions, but it does finish with this note:
High levels of grid - connected PV would contribute to renewable generation and may require new approaches to the management of the electricity grid to ensure that New Zealanders continue to have access to safe, reliable, and affordable energy.
I know from friends working in the sector that this is in fact the biggest challenge we face with the introduction of solar energy. According to Transpower, New Zealand's electricity grid was not built to manage a lot of distributed generation of electricity - it was built to facilitate the transmission of electricity mainly from one area (the South Island's hydro stations) to another (north of the North Island, where 50% of New Zealanders now live). So accelerating growth in solar energy is likely to lead to further costs down the line for consumers.

Monday, 22 September 2014

Thank you!

My sincere thanks to everyone who supported myself and National at the general election. We're very pleased that National secured the party vote here in Rimutaka. It was a challenging campaign and one full of great experiences, debates and issues.

We know from the booth-by-booth analysis that we won across central Upper Hutt and the outlying suburbs, including Stokes Valley and Totara Park, both traditional Labour areas. Avalon and Manor Park were 50/50. However the southern booths remain a struggle.

I will remain engaged on the issues that matter to the people of Rimutaka, especially transport, economic development and local authority amalgamation. A number of people have asked if I will stand again - it's too early to say, as that's a decision for the local Rimutaka members of the National Party. If you want to be part of that decision in 2017, you'll need to keep your membership up to date. Please remember to renew!

Over the next three years we will continue to build the electorate organisation, membership and fighting funds for our campaign in 2017. But for now I can say that I'm proud to have represented the party and to have helped many of the residents of Rimutaka.

Sunday, 21 September 2014

The result

My sincere thanks to everyone who helped on our campaign for Rimutaka. Sadly, it wasn't to be on the electorate vote, but National did win the party vote once again, with 42% of the total votes cast.

Election Results -- Rimutaka

Electorate Number:44Final:Yes
Results Counted:58 of 58 (100.0%) Votes Counted:33,067
Less than 6 votes taken in Voting Places:0Special Votes:3,988
Leading Candidate:HIPKINS, Chris (LAB)Majority:5,831
Labour Party10,631HIPKINS, ChrisLAB17,333
National Party13,895HOLDEN, LewisNAT11,502
New Zealand First Party3,426HUNT, AaronNZF1,601
Conservative1,381LYNCH, Philip MichaelCNSP886
Green Party2,693RUTHVEN, SusanneGP1,437
ACT New Zealand115
Aotearoa Legalise Cannabis Party145
Democrats for Social Credit12
Focus New Zealand4
Internet MANA249
Māori Party128
NZ Independent Coalition18
The Civilian Party18
United Future110
Party Informals159Candidate Informals308