News: 6 December 07
Research grants yield big returns

Labour-led government support for businesses doing innovative research and development is paying dividends, says Research, Science and Technology Minister Pete Hodgson.

Many companies that received grants under the Technology for Business Growth (TBG?) scheme run by the Foundation? for Research, Science and Technology over the past five years have reported significant increases in turnover, new products and exports, Pete Hodgson said.

"The results of a study of TBG contracts are encouraging because they show that the government’s contribution to technology development and innovation through R&D is paying off.

"The companies surveyed in this study signed their TBG contracts four to five years ago. What the study does is look at the outcomes after the contracts ended. It shows that much of the funding was good for the companies and good for New Zealand."

The TBG Performance Report, prepared by the Foundation, surveyed 51 firms that had completed TBG contracts worth $50,000 or more and reached the milestone of 18 months post-contract during 2006/07. The main results included:

• Average turnover of the firms increased by 29 per cent since the beginning of their TBG contracts, with one in three reporting a more than 200 per cent increase.
• Total export revenues of the firms were $424 million, 35 per cent of turnover, with one in seven reporting an increase of more than 200 per cent.
• Average R&D expenditure of the firms increased by 37 per cent.
• 127 new or improved products, processes or services resulted from 45 of the TBG projects.
• Current annual revenue from the technology developed was estimated at $4.4 million for each $1 million of TBG grants, with over 70 per cent of the revenue from exports.

The report is available here.