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Financial Assistance


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Paper 3 - Foundation Services

Hon Jim Anderton, Minister for Industry and Regional Development and Hon Jim Sutton, Minister for Trade Negotiations
[ Last Updated 2 November 2005 ]


41. Industry New Zealand and Trade New Zealand currently offer three types of funding assistance initiatives for entrepreneurs, start-ups, and small businesses exporters: Enterprise Awards, World Class New Zealanders, and the Export Network Programme.

  • BIZ Enterprise Awards - the Awards aim to assist innovative firms and entrepreneurs to build capability to test and develop early stage business concepts and projects by providing funding to employ expertise and advice. The programme is delivered and administered centrally through Industry New Zealand and offers funding for up to 50% of eligible costs up to a maximum of $20,000. Eligible costs are included as Appendix 1. Since its inception in September 2000, 760 awards totalling $7.441 million (GST not applicable) have been made. The programme has annual funding of $2.813 million (GST not applicable).
  • World Class New Zealanders (WCNZ) - supports two main activities. Support for international business missions involves assistance to build the capabilities of New Zealand businesses with potential for growth by facilitating international business missions that assist industry sectors, clusters and regional business groups to achieve strategic goals. Support for international business exchanges involves funding assistance to facilitate the transfer of international business skills that are not readily available in New Zealand. In the 2001/2002 year, 33 business exchanges were approved totalling approximately $0.268 million (GST not applicable), and two business missions approved totalling approximately $0.023 million (GST not applicable). The programme has annual funding of $0.800 million (GST not applicable).
  • The Export Network Programme - this provides funding assistance to groups of three or more companies to undertake export activities. Trade NZ funds up to 50% of the costs for specific activities around international market investigation. A caveat is that there has to be at least three companies co-operating strategically. The Export Network Programme has annual funding of $4.500 million (GST not applicable) and has supported approximately 210 networks.

Lessons Learned and Proposed Enhancements

42. A stocktake of Industry New Zealand programmes conducted by the Ministry of Economic Development in June 2002 identified several issues around the existing Enterprise Awards Scheme. These include:

  • Contestability of the scheme - a contestable awards scheme means that many businesses that could benefit and have deserving proposals either miss out or do not apply because of the perceived difficulties. Businesses often do not know for up to two months whether their application will be successful. The quality of the funded proposals varies from round to round as approval is based on the number of applicants.
  • Lack of appraisal of firm capability building needs - the limited capability of small business owners to self-appraise their needs limits the programmes ability to effectively address critical capability issues.
  • Potential overlaps with the case managed Business Growth Fund - the start-up and entrepreneur targets established under the Awards were not being achieved. The limited funding has lead to a greater focus on high growth and more established businesses than was intended.

43. The stocktake suggested that the programme be modified to address the above issues. There is also a wider issue in that the BIZ Enterprise Awards are not well aligned with the objective of other BIZ services to encourage capability development and training nor the new objective of NZTE to encourage internationalisation.

44. It is also apparent that the Export Network Programme has overlaps with WCNZ and some overlaps with funding categories provided through BIZ Enterprise Awards, albeit with different entry criteria. The Export Network Programme requires a network of at least three companies to be working together to access funding. This has a dual purpose of encouraging networking and its associated benefits as well as providing a check that assistance for overseas travel and associated costs is appropriate. This is consistent with business missions through WCNZ.

45. It is proposed that the BIZ Enterprise Awards be amalgamated with WCNZ and Export Network funding and re-designed into a more flexible Enterprise Development Grants scheme to address the issues raised above. The following changes are proposed, subject to more detailed work and a further report back:

  • The scheme would offer grants rather than awards, where businesses and entrepreneurs meeting set criteria would receive assistance (rather than the current monthly assessment where only the top proportion of applications receive awards).
  • Grant assessments could be devolved to regional agencies, BIZ Lead Providers and NZTE's client managers using a standardised appraisal and clear criteria. NZTE would continue to process applications and provide the final approval for grants.
  • Funding would be available for 50% of total costs to a maximum of $20,000 (GST not applicable) per applicant per annum for businesses and entrepreneurs to:
    1. Engage the services of a business mentor for a period of time
    2. Undertake more advanced management and technology based training (as delivered through existing providers such as NZIM, Polytechnics etc)
    3. Employ specific external advice and expertise in a management area (such as feasibility studies, e-business, market research, enhancement and uptake of new technologies, human resources, intellectual property, strategic planning, environmental management, production management)
    4. Undertake international market development activities, including new market investigation, trade fair participation, trade/business missions, business exchanges, and visiting buyers.
  • The current broad criteria under the Enterprise Awards Scheme for business and entrepreneur eligibility for assistance for (a) - (c) above would continue with the Grant scheme (see Appendix 1 for details). The criteria for (d) would remain largely consistent with the existing Export Network and WCNZ criteria (see Appendix 2 for details).

46. A grants-based programme with clear criteria would mean that entrepreneurs and businesses will have greater clarity when they apply about whether they will get funding. This reduces uncertainty and allows businesses to plan appropriately. Devolving aspects of the administration of the grants scheme to regional agencies could allow better appraisal of business needs and capabilities.

47. The modified programme will be co-ordinated with the Growth Services Fund (see Paper 4 - Growth Services) to minimise overlaps. Links and delivery opportunities with other funding programmes, including FRST's Technology for Business Growth programme and TEC's bright future scholarships, will also be addressed in the development of the detailed criteria.

48. Proposed changes to a grants programme from an awards scheme may require an increase in funding to meet demand. It is considered that at least $10.000 million (GST not applicable) in total is required to run the programme effectively. Existing funding (which totals to over $8.000 million, GST not applicable) will come from the amalgamation of the Enterprise Awards Scheme, the Export Network Programme and WCNZ. Extra funding, if required, could potentially come from integration savings. Final integration savings and programme enhancement costs are being worked through and will be subject to a report back to Integration Ministers (the Ministers of Finance, Industry and Regional Development, Trade Negotiations and Associate Foreign Affairs and Trade) by 30 May 2003 (see Paper 5 - Transition Costs1). In addition, the Export Network Programme is subject to a budget bid for a further $0.500 million (GST not applicable) as part of the GIF package in 2003/2004 and outyears. If successful, this funding would be added to the Enterprise Development Grants scheme.

49. Specific details on the operation of the Enterprise Development Grants scheme will be developed by NZTE in consultation with officials from the Ministries of Economic Development, Foreign Affairs and Trade, Pacific Island Affairs, Research, Science and Technology, Women's Affairs, Te Puni Kōkiri, the Treasury, Tertiary Education Commission, and the Foundation for Research, Science and Technology and will be reported to Integration Ministers by 30 June 2003. The new scheme can be implemented by 1 July 2003.

1This paper is part of a suite of six papers on the new entity formed by the merger of Industry New Zealand and Trade New Zealand. Paper 5 - Transition Costs has not been published on this website as it was no longer current at the time of website publishing.


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