"This might involve putting more emphasis on negotiation rather than contestable purchasing, particularly for recognised core programmes."
Science Minister Pete Hodgson said yesterday: "We need to shift a notch or two away from contestability."
The Government is spending $677 million on research this year. Of this, $105 million goes to universities through student funding, $72 million is spent by other Government departments, and $500 million is allocated in contestable funding rounds by the Foundation for Research, Science and Technology, the Health Research Council and the Royal Society.
Crown research institutes still get the bulk (76.5 per cent) of the $325 million allocated in the foundation's main funding scheme, which started off earmarked almost entirely for them.
But universities now get 11.1 per cent of the fund, private companies and individuals 7.2 per cent, and non-profit research institutes 5.2 per cent.
Ministry chief executive James Buwalda and the heads of the Association of Crown Research Institutes last week met the national science committee of the Public Service Association, which represents most staff in the institutes.
PSA national secretary Bryce Fleury said there was a general consensus from all sides that more stability was needed.
"There was an acceptance that we needed to shift the system from a competitive market-based approach with a third of the funding up for grabs every year, when all the cards were thrown in the air and everyone looked to see where they fell down and picked up the pieces afterwards."
He said the PSA wanted 80 to 85 per cent of the money allocated in long-term contracts, with the rest up for tender each year.
But the institutes themselves propose a less extreme approach. For example, Forest Research wants long-term funding only for its basic "transformational science platforms", employing between 80 and 100 of its 375 staff.
Association president Paul Tocker said the Crown research institutes proposed long-term funding of non-profit research that maintained basic science capabilities in the fields New Zealand needed, with short-term contestable funding for more profit-oriented applied research.
"We are looking to engage all of the players - the ministry, the foundation, the CRIs, the private research providers and the universities - to have a good hard look at the effectiveness of the funding and the whole contribution of science in New Zealand - a bottom-up review."
Dr Buwalda said the ministry agreed that longer-term contracts could be negotiated for "technology platforms in a range of areas that are important for our future, such as biodiversity, biomaterials, animal genomics".
But he still saw "open contestability" both for more applied research and for "blue skies" research financed by the Marsden Fund and New Economy Research Fund.
"What we are trying to do is to keep faith with the directions or commitments that have been made, but finetune where that's appropriate."
Hodgson said the changes would seek a middle line which gave scientists more certainty, while also ensuring that science did not become frozen in a fixed pattern.
He said the ministry was appraising the Crown research institutes because it was now 10 years since they were created in 1992.
He hoped the review would be completed by Christmas.
Meanwhile, a working party chaired by Auckland University mathematics professor Marston Conder is working on a "performance-based" formula to allocate the $105 million or so that universities get for research from student-based funding at present.
The new formula, due by late this month, is expected to include both "peer review" of the quality of research and numerical measures such as the number of postgraduate students and the level of external research funding.
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