Science sector faces biggest overhaul in decades, warns cuts will put new research at risk

[xh] Science cuts could come at the cost of new and research, sector warns

The administrators of a leading science fund fear cuts as part of the sector's biggest overhaul in decades could come at the cost of new and innovative research.

Budget 2025 allocated just over $813 million for business, science and innovation. Almost three quarters of that, nearly $577m, was dedicated to rebates for international filmmakers, leaving about $236m for science and innovation.

The budget funded major science reform through the reallocation of money from funds dedicated to research and innovation, with much of the $212m repurposed for new government initiatives.

The Science Minister said the reprioritisation of funds would help unleash the long-term potential of the new science system.

However, administrators of the blue-skies research Marsden Fund are worried cuts will curb innovation and evidence-based solutions at a time when they are needed most.

Where's the repurposed money going?

Much of the $212m reallocated from research and innovation funds such as the Health Research Council, Marsden Fund and Strategic Science Investment Fund, would help set up an office to oversee changing gene technology rules as well as an agency to attract foreign investors.

Eighty-four million dollars of repurposed funds were slated for Invest New Zealand over four years and close to $23m to establish a new Gene Technology Regulator over the same period, while the merging of Crown Research Institutes into three of the four new public research organisations was allocated $20m over two years.

Money found in the disestablishment of Callaghan Innovation would also contribute to the new science landscape, such as the formation of the Science, Innovation, and Technology Advisory Council - nearing $6m over five years.

However, $38m of reallocated money was set aside for Callaghan Innovation's shutdown, with another $20m to keep its Gracefield Quarter running for another year, while the government decided its future.

Research funding to take a hit

The chair of the Marsden Fund Council, Professor Gill Dobbie, said Budget 2025 resulted in a $5m funding cut over three years, and suspected that would come at the cost of new research projects.

The 30-year-old fund, established to support excellent fundamental and blue-skies research, was allocated just under $79m in the 2025/2026 financial year.

The Science Minister's office confirmed that funding for Marsden would be cut in stages over the next couple of years, with a new baseline funding of $71m from 2028/29.

For the 2025 funding round, the Marsden Fund Council anticipated just over 100 projects - from a total of 978 proposals - would receive grants from about $80m in available funding.

Projects typically received funding for three years of research, Dobbie said, therefore already contracted researchers would be prioritised when the cuts came in.

"There likely will be a reduction in [the] number of new grants we can award each year from 2026/27," she said.

"The Marsden Fund Council will review the amount committed through existing research contracts and then determine the number of new grants that can be awarded."

In a post-budget statement, the fund's administer, the Royal Society of New Zealand, said the budget cuts came at a time when New Zealand needed "innovation, critical thinking, and evidence-based solutions more than ever" and followed changes to the Marsden Fund last year, that saw support for social sciences and humanities research dropped, and an increased focus on research with the potential for economic benefit.

Royal Society chief executive Paul Atkins expressed concern that funding cuts would "effectively reduce the amount available for active research projects".

"The capability of our research sector has taken years to build up, and we risk losing talented, knowledgeable, and highly skilled experts."

Meanwhile, the Ministry of Business, Innovation, and Employment (MBIE) has cancelled the 2026 funding round for its contestable Endeavour Fund to focus on the merger of Crown Research Institutes into new mega science entities.

The $55m Endeavour Fund supported research via Smart Ideas - designed to be fast-fail - and longer-term research programmes of up to five years.

MBIE said there was precedent to pause contestable funding rounds during a shake-up to reduce the burden on staff.

It said the funding for 2026 would instead be directed to current research projects that would otherwise end.

"We expect that a contestable round will be undertaken in 2027 subject to further work as part of the science reforms."

Budget will 'unleash potential' - Minister

Science Minister Shane Reti said the reallocated funding would ultimately benefit the system and create more opportunites for research and innovation.

He said funding for science, innovation and technology was in line with Budget 2025's approach to economic and fiscal management.

"The government has reprioritised funding for initiatives we need to unleash the potential of our science system in the long term - providing for a modern gene technology regime and fundamental changes to New Zealand's science, technology and innovation system, including new public research organisations and a forward-looking science council."

Science, innovation and tech start-ups would also benefit, he said, from the government's $100m budget boost to Elevate NZ Venture Funding and an increase to the R&D tax incentive.

"I see these as long-term investments that will over time create even more opportunities for world-leading research and innovation that leads to better outcomes for New Zealanders and our economy."

Regarding the Endeavour Fund, he said it had not been suspended.

"Any speculation about the future of the Endeavour Fund is just that - speculation. Changes to future funding rounds would likely be subject to Budget decisions."

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