Science, Innovation and Technology Minister Dr Shane Reti said public good science was still being supported, and the government would have more options to reinvest in the future. (File photo)
Photo: RNZ / Marika Khabazi
A decades-old fund dedicated to blue-skies research says it was given a day’s notice of further funding cuts and told to keep quiet about it until the government made it public.
The Marsden Fund, which backs fundamental research – science for the sake of knowledge – is among three contestable funds to lose millions to help set up the new Institute for Advanced Technology.
Scientists said slashing funding for such research could have significant unintended consequences for innovation and warned the Prime Minister as such in a letter earlier this month.
The cuts come amid a long-awaited review into the sector – final recommendations were delivered to the Science Minister three months ago, but are yet to be made public – and after the government announced the biggest overhaul of the science system in decades, to “ensure a system that generates maximum value for the economy”.
The reforms so far have seen the dissolution of science commercialisation arm, Callaghan Innovation, and merger of the six Crown Research Institutes into three mega science entities or Public Research Organisations (PROs) plus a fourth dedicated to advanced technology.
Callaghan Innovation was dissolved in the government’s overhaul of the science sector. (File photo)
Photo: RNZ / Rebekah Parsons-King
The Ministry of Business, Innovation, and Employment (MBIE) said of the $231 million earmarked for the Institute for Advanced Technology over the next four years, more than half – $150.4m – was to be reallocated from within the science, innovation, and technology portfolio.
MBIE’s general manager of technology and innovation Dean Ford said it represented a shift in priorities towards emerging technologies that could be commercialised.
“The majority of this funding will continue to go into science – but into new areas of research that have significant potential, where New Zealand is developing greater capability.”
Science Minister Shane Reti said organisations affected by the reallocated funding for the Institute for Advanced Technology, were advised ahead of the public announcement on 18 July.
From July 2028, the Endeavour Fund, which provided funding for university researchers, will have its funding cut by $13.5m, and the Health and Research Council will lose $11.5m. While the Marsden Fund will have its funding slashed by a one-off $15m.
Just over $24m has been found in the disestablishment of Callaghan Innovation’s operations across 2027-29, $18m from the New to R&D Grant for three years from 2025, and $3m is being reprioritised from ‘contract management’ over the next three years from July 2026.
MBIE said $37.5m has also been found from within the Strategic Science Investment Fund from contracts which are coming to an end over the next three years, and $21.6m has been reprioritised from unallocated National Science Challenge funding.
The remaining $80m will support the parts of Callaghan Innovation that are being retained.
The changes are in addition to the $212m repurposed from research and innovation funds in Budget 2025 to support the overhaul of the science system.
In a statement the Royal Society, which administered the Marsden Fund, said it learned of the $15m funding cut the day before the Institute for Advanced Technology was announced.
“The Royal Society Te Apārangi received a letter from the Ministry of Business Innovation and Employment (MBIE) on the afternoon of Friday 18 July 2025, confirming a phonecall the previous evening.
“The letter advised that the Marsden Fund will be reduced by a further $15 million in the 2028/29 year, in addition to the reductions already announced in the Government’s 2025 Budget in May.
“Separately, MBIE requested that this information be treated in strict confidence until the government publicly released it.”
A briefing to the Science Minister regarding the funding for the Institute was made public on MBIE’s website on 6 August.
The society said the $15m reallocation “effectively doubles the reductions already announced in this year’s budget, amounting to a cut of about 29 percent over the 3 years from 2026/27 to 2028/29”.
President of the Fund professor Jane Harding said the cuts to fundamental research were likely to have “significant unintended consequences” and “will undermine the long-term potential of the new Institute”.
“The Society is very concerned that cuts to funding for the fundamental research supported by the Marsden Fund will undermine the long-term potential of the new Institute and other parts of the sector that apply early stage research, by significantly reducing the pipeline of knowledge at the new-discovery end of the process.
“This may have important unintended consequences for New Zealand in the long term.”
The cuts follow a government directive last year, that saw the Marsden Fund abandon support for social science and humanities research and direct at least half of its investments to research with economic potential.
A spokesperson for the Health and Research Council said it’s too early to know how the loss of $11.5m per year from July 2028 – a 10 percent reduction to its investment fund – and the almost $600,000 cut to its operational budget from next July, will impact the council’s work.
The Association of Scientists said it’s “extremely concerned” by the reprioritisation of funds and says the cuts on top of Budget 2025 mean “our major research funds are in extremely bad shape”.
Co-president Lucy Stewart said the reduced contract management funding likely meant there would be jobs lost at funders such as the Royal Society and MBIE.
Reti said “the government has made it clear on several occasions that we want publicly funded research to focus on solving real world problems that can be commercialised”.
He said public good science was continuing to be supported, and the government would have more options to reinvest in the future, “with the economic gains that can be made through commercialising research and advanced technologies”.
Meanwhile, the final report of Sir Peter Gluckman’s review of the science system is yet to be made public following its delivery to the Science Minister at the end of April.
The long-awaited report was the second part of the Science System Advisory Group’s review of the sector, and would include recommendations on the system’s funding.
Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.