Incentives for firms to invest in innovation are welcome, says BusinessNZ.

An $80 million increase in funding for Growth Grants announced today will provide more incentives for companies to increase their research and development, BusinessNZ Chief Executive Phil O’Reilly said.

The Growth Grants, administered by Callaghan Innovation, are allocated to firms that spend at least $300,000 per year, and 1.5 percent of their revenue on R&D for two years.

Mr O’Reilly said the funding was well-targeted.

“Given budgetary constraints faced by the Government, it is positive that the choice has been made to allocate funding where it can be most effective – in prompting innovation by New Zealand companies.

“Innovation in goods and services is the best way for New Zealand firms to compete in world markets, and to counteract the effects on exporters of the strong dollar.

“Funding premised on R&D investment by firms themselves is sound policy which will be welcomed by the many New Zealand firms seeking to innovate and upgrade.”