• Skip to content
  • Skip to navigation
Global site
  • Global site
  • Algeria
  • Botswana
  • Cameroon
  • Egypt
  • Ethiopia
  • Gabon
  • Guinea
  • Kenya
  • Libya
  • Malawi
  • Mauritius
  • Morocco
  • Namibia
  • Nigeria
  • Senegal
  • South Africa
  • Togo
  • Tunisia
  • Uganda
  • Zambia
  • Zimbabwe
  • Anguilla
  • Antigua
  • Argentina
  • Aruba, Bonaire, Curacao and St. Maarten
  • Bahamas
  • Barbados
  • Bolivia
  • Brazil
  • British Virgin Islands
  • Canada LLP
  • Canada RCGT
  • Cayman Islands
  • Chile
  • Colombia
  • Costa Rica
  • Dominica
  • Ecuador
  • El Salvador
  • Grenada
  • Guatemala
  • Honduras
  • Mexico
  • Montserrat
  • Nicaragua
  • Panama
  • Paraguay
  • Peru
  • Puerto Rico
  • St Kitts
  • St Lucia
  • St Vincent and the Grenadines
  • Trinidad & Tobago
  • Turks and Caicos Islands
  • United States
  • Uruguay
  • Venezuela
  • Afghanistan
  • Australia
  • Bangladesh
  • Cambodia
  • China
  • Hong Kong
  • India
  • Indonesia
  • Japan
  • Korea
  • Malaysia
  • Mongolia
  • Myanmar
  • New Zealand
  • Pakistan
  • Philippines
  • Singapore
  • Taiwan
  • Thailand
  • Vietnam
  • Albania
  • Armenia
  • Austria
  • Azerbaijan
  • Belarus
  • Belgium
  • Bosnia and Herzegovina
  • Bulgaria
  • Channel Islands
  • Croatia
  • Cyprus
  • Czech Republic
  • Denmark
  • Estonia
  • Finland
  • France
  • Georgia
  • Germany
  • Gibraltar
  • Greece
  • Hungary
  • Iceland
  • Ireland
  • Isle of Man
  • Israel
  • Italy - Bernoni
  • Italy - Ria
  • Kazakhstan
  • Kosovo
  • Kyrgyzstan
  • Latvia
  • Liechtenstein
  • Lithuania
  • Luxembourg
  • Malta
  • Moldova
  • Monaco
  • Netherlands
  • North Macedonia
  • Northern Ireland
  • Norway
  • Poland
  • Portugal
  • Romania
  • Russia
  • Serbia
  • Slovak Republic
  • Slovenia
  • Spain
  • Sweden
  • Switzerland
  • Tajikistan
  • Turkey
  • Ukraine
  • UK
  • Uzbekistan
  • Bahrain
  • Egypt
  • Jordan
  • Kuwait
  • Lebanon
  • Oman
  • Qatar
  • Saudi Arabia
  • United Arab Emirates
  • Yemen
Grant Thorton Logo

Grant Thornton Logo Grant Thornton logo

  • Meet our people
  • Insights
  • Services
  • Industries
  • Careers
  • Locations
  • Business advisory services
  • Financial advisory services
  • Tax
  • Audit
  • Operational advisory
Business advisory services Home
  • NZTE support for businesses impacted by COVID-19
Financial advisory services Home
  • Asia Services Group
  • Business valuations
  • Capital markets
  • Complex and international services
  • Corporate insolvency
  • Debt advisory
  • Expert witness
  • Financial models
  • Forensic and investigation services
  • Independent business review
  • IT forensics
  • Mergers and acquisitions
  • Raising finance
  • Relationship property services
  • Restructuring and turnaround
  • Transaction advisory
Tax Home
  • Corporate tax
  • Employment tax
  • Global mobility services
  • GST
  • International tax
  • Research and Development
  • Tax compliance
  • Transfer pricing
Audit Home
  • Audit methodology
  • Audit technology
  • Financial reporting advisory
Operational advisory Home
  • Business architecture
  • Internal audit
  • IT advisory
  • IT privacy and security
  • PCI DSS
  • Process improvement
  • Procurement/supply chain
  • Project assurance
  • Risk management
  • Robotic process automation (RPA)
  • Energy and resources
  • Financial services
  • Food and beverage
  • Health and aged care
  • Media and entertainment
  • Not for profit
  • Professional services
  • Public sector
  • Real estate and construction
  • Grant Thornton New Zealand
  • Press releases
  • 2015
  • Budget 2015: is Kiwi ingenuity in danger of becoming a distant memory?

Budget 2015: is Kiwi ingenuity in danger of becoming a distant memory?

30 Mar 2015
  • 2015

Is Kiwi ingenuity in danger of becoming a distant memory?

The criteria and processes of Callaghan Innovation grants have been recently called into question by opposition MPs. Irrespective of whether Callaghan is contributing to our economy’s productivity or generating a significant ROI for every dollar granted, it’s a positive step in the right direction. The bigger issue is the actual lack of R&D and innovation activity in New Zealand businesses and our lack of presence on the world’s business stage.

Is kiwi ingenuity becoming a thing of the past? Hopefully not.

The Government is ahead of the eight ball here. Minister of Finance, Bill English, has already stated that this year’s Budget will continue to support the Government’s Business Growth Agenda. This is crucial in making the most of the opportunities available to New Zealand businesses in international markets to grow the economy and increase investment in skills and innovation.

But is it enough? We are a nation of SMEs, but what is the level of business acumen amongst these businesses? Unfortunately not as high as we would like and we are not really looking to “upsmart” our business practices.

Latest data from Statistics New Zealand shows in the period between 2012 and 2014, investment in basic and applied research has dropped by $17m to $658m and $61m to $1019m respectively. Expenditure in experimental development has increased by $71m to $942m in the same period. However, the data also shows that R&D has grown at a slower rate than GDP. Expenditure as a percentage of GDP has fallen from 0.57% to 0.54% in these two years.

Recent research conducted by Grant Thornton shows at the end of Q4 2014, only 18% of businesses surveyed are expecting to increase their expenditure in R&D, and we are spending less than our major trading partners who predict more R&D spending; China (37%), United States (37%) and the United Kingdom (23%).

An area of focus for Budget 2015 could be driving innovation through the education system and stepping outside the realms of the core curriculum and conventional teaching practices. A good example here is Unitec’s partnership with Mindlab, a new facility that teaches educators and young people key digital and technological literacy capabilities. This is a great pre-emptive strike against lack of job security for future generations. 

We should also be thinking about:

  • the relevance of the traditional skills being taught at University and if they are fit for purpose in today’s business world
  • building stronger relationships and better programmes between the business and education sectors
  • what we can do to better educate business owners
  • incentivising business owners to set aside time and space for employees to innovate and upskill.

But that’s not to say New Zealand businesses are not aware of the importance of being innovative.

Another survey conducted late last year by Grant Thornton showed only 8% of businesses surveyed place low importance on innovation, the remainder stated it was important (28%), very important (56%) or critically important (8%). So what’s the hold up? The same survey revealed that respondents felt certain aspects of their business model needed improvement; the top four areas of concern were business strategy (63%), digital strategy (53%), internal processes (55%) and their go to market plans (33%). That is why any boost from the Government will be well received

And when asked what they feared would derail their growth plans, a staggering 38% of businesses cited the capability of their people. 

Many businesses owners are ambitious, hardworking and smart, and they are aware of their short comings, so any assistance the Budget can give them to help overcome these will be repaid many times over in boosting the New Zealand economy.

The time to reignite the fire we once had for ingenuity and innovation is now. Budget 2015 is a prime opportunity for Government to fan the flames.

Further enquiries, please contact:

Vanessa Black
Partner, Audit
Grant Thornton New Zealand
T +64 (0)9 308 2985
E vanessa.black@nz.gt.com

  • Follow us on Instagram
  • LinkedIn icon
  • Twitter icon
  • Facebook icon
CONNECTclose
  • Contact us
  • Make an enquiry/submit an RFP
  • Meet our people
  • Careers
  • Alumni
  • Locations
ABOUTclose
  • About Grant Thornton
  • Insights
  • Press
LEGALclose
  • Privacy
  • Disclaimer
  • Sitemap

© 2021 Grant Thornton International Ltd (GTIL) - All rights reserved. "Grant Thornton” refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate, one another and are not liable for one another’s acts or omissions.

    • EN