Collins can say what she think’s the Government’s doing wrong.
“The R&D [research and development] credit is of absolutely no use whatsoever to a small startup that can, isn’t revenue positive,” she said. “If it doesn’t pay any tax to claim a credit on, and just doesn’t work for them. It doesn’t do anything to actually build the startup culture we need.”
And she is open to the criticism from local players that the current all-of-Government procurement process, with the cost and complexity of its tender process, can tilt in favour of the multinationals.
“It’s easy for big government to deal with big business, and that’s what we see,” she says.
But what will we see National put forward as an alternative? We’ll have to wait and see.
Collins says Friday’s pow-wow forms part of a “roadmap” to develop her party’s tech policy. Specifics won’t be released until some time in 2023.
Her general comments, however, indicate she’s comfortable with the Government playing an active role in boosting the tech sector.
“There are many more wonderful examples of Kiwi technological ingenuity, aided and supported by government policy. Past initiatives, such as the rollout of Ultra-Fast Broadband under the last National government, were instrumental in enabling us all to keep working during the Covid lockdowns,” Collins says. (Then IT Minister Steven Joyce championed the UFB as a necessary strategic intervention when it launched in 2011, although then ACT MP Sir Roger Douglas said the Government might as well “take one thousand, five hundred million dollars and flush it down the toilet.”)
Collins says she’s looking at Singapore, Ireland, Israel and Estonia for ideas - all small countries with high levels of public-private initiatives in their tech sectors.
Beyond the 15 per cent R&D tax credit, one of the current Government’s big moves to back early-stage companies has been the creation of the $300m Elevate fund, which co-invests with private venture capital funds.
Elevate, launched in mid-2020, has now invested more than $194m of its capital, and it’s still an open question whether the current Government will top it up when it runs dry - against the backdrop of a broader VC scene where money is suddenly tight.
Would Collins tip in more funding? She won’t say, but she does say a lot of policy work is underway. Ideas will be road-tested with the tech community. “We need more innovation, and smarter use of public money.”
The Labour-led Government scaled back Callaghan’s direct grants (called a “government picking winners” scheme by critics like Sam Morgan) in favour of its universal R&D tax credit (although, after uptake of the tax credit scheme fell short of targets, grants were again boosted).
And while there has been recent controversy over the level of due diligence applied to grant, and how the money is spent, Collins says she wants to stay out of it.
The National tech spokeswoman says she’s very aware of accusations, she wants to stay apolitical and positive.
And she makes it clear she’s a strong supporter of Callaghan Innovation (formed in 2013 by John Key’s Government as it merged a Crown Research Institute, Industrial Research Ltd, with several smaller agencies).
“It’s without doubt that Callaghan has been a huge asset to this country,” she says. “But we have to make sure we’re making the best use of it.”
