By Yoke Har Lee
The Foundation for Research Science and Technology (FRST) has been chosen to manage the $28 million New Economy Research Fund - a move slammed by the private sector.
Nor are the foundation's industry-based critics happy, saying foundation funds have been channelled towards agriculture.
"It is no surprise. I don't think they are the right party at all. The money will be going into the same directions [heavily skewed towards agriculture]," said John Blackham, one of the founders of New Zealand Intellectual Capital Foundation, a charitable trust aimed at fostering education, business and being a catalyst for change.
The New Economy Research Fund was announced by Enterprise and Commerce Minister Max Bradford in August. It aims at capturing research to propel future industries who will grow from blue sky research.
John Ball, president of the NZ Software Association said: "FRST has traditionally been focused on the pastoral economy and has been struggling to get away from that. Maybe the new fund will try to help them move on ... This new fund has more potential but it needs to be tied to the commercial side."
Colin Harvey, founder of animal healthcare company Ancare, said the main problem with the funding system was that research development had not sought commercial partners early enough into the project.
"Traditionally, funding has been to meet research output needs, not how it can be commercially implemented. I think FRST will have to bring new people in, with commercial content, to manage the fund."
But FRST director Neville Jordan said it would be wrong to dismiss the agriculture sector's importance to the economy.
"There is a misconception out there with people equating agriculture with low-tech. There is a lot of R&D in agriculture that is high-tech in nature, equivalent to anything done in electronics and software."
Mr Jordan admitted that in the past, research money hasn't been efficiently spent in all areas.
"But the right steps have been taken to ensure things change. The new statement of corporate intent and the additional board with people bringing different skills are all recognition that we do have to get better at getting better value out of research dollars."
Mr Blackham said he favoured an entirely new approach: setting up a new panel, particularly with representation by venture capitalists, to dish out the money from the new fund.
"To focus on the new economy, the money's got to be given to the new economy people. Don't give it to captains of industry, they are of the old world. Ask each of the venture capital people to nominate one person within their new economy to be on the distribution council."
Critics come out against foundation's role
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