Prime Minister Helen Clark’s introductory speech to the new-term election-year parliament has been widely criticised as long on vision and short on specific strategy and tactics to attain the rather modest goal of moving back into the top half of OECD income scales. In the early 1970s, New Zealand led the OECD table.
ICT has been “targeted”, along with its old stable-mate biotechnology and newer “creative industries” like film-making, as the “innovative” industry sectors that will revitalise the economy.
Much of last week’s address was devoted to praising the incentives that the government has already put in place to encourage what it considers to be industries with a future; incentives such as the new venture capital fund and a more forgiving attitude to tax-deductibility of R&D expenditure.
This has already resulted in expanded R&D expenditure, the government trumpets, though sceptics point to the probability that existing R&D previously concealed under other expense headings to claw back tax is now simply emerging under an honest heading.
Case studies are appended, with the intentions of highlighting the government-aided successes in the field. The background report on the innovation push singles out “a small but active wireless technology sector” with Talon Technologies, Ericsson-Synergy and Vodafone specifically mentioned, and “world-class” software achievements like the Jade applications development environment and the perennial shining example, Tait Electronics.
“Information and communications technology helps drive the modernisation of the entire economic and social infrastructure, and is an essential part of making e-commerce a reality,” says the innovation report, unsurprisingly.
The perspective is scarcely new; IT, with perhaps less historical emphasis on the communications side, and the broad field of “biotechnology” have been trumpeted as New Zealand’s saviour in various government reports and events for at least the past 15 years.
And Computerworld was writing about the potential of IT-aided “creative industry” clusters two years ago or more, reporting a trend of which the then government was well aware.
“We were invited through the front pages of our papers to a four-course meal, yet we received yesterday’s fish and chips warmed up again,” says National party leader Bill English.
Clark hints at new measures to “[improve] our intellectual property framework to ensure New Zealand gets full value from its innovations”. The lack of protection for intellectual property exposed online, while at the same time not trespassing on the right of users to information, were discussed at a Victoria University seminar last week.
Under the heading of legislative reform, though, no mention was made of the Electronic Transactions Bill, still snarled in the Parliamentary queue, and expected to be a powerful incentive to facilitation and strengthening of protection for online intellectual property.
Likewise, easing the business and regulatory compliance burden of companies is cited as an important element of establishing a framework for innovation, but no mention is made of e-government’s potential to help achieve this.
About the only new things definitely slated to be created by government are committees to bring private industry and government together, and to select specific projects to qualify for incentives. Economist Brian Easton, for one, thinks such a special purpose body as the latter would stand little chance against a Treasury determined that a particular subsidy is not an appropriate direction.
Clark herself acknowledges that the document and speech are not intended to spell out detailed policy initiatives and timetables.
The government also seems to be trying to have a bet each way, by reassuring potential voters that emphasis on knowledge industries does not mean downgrading the importance of “old-economy” earners like forestry or tourism, and that promotion of “biotechnology” need not mean genetic engineering, but also environmental research and investigation into the processing of “natural” products.
The Green party has somehow read into this an endorsement of organic farming, though the phrase is mentioned nowhere in the documents.
National’s English, as might be expected, contrasts Clark’s gung-ho attitude to biotechnology with the compromise position of the Royal Commission on genetic engineering, endorsed by the government.