Engaging with Sectors
[ Last Updated 15 August 2008 ]
Groups of firms often have issues in common that affect their opportunities for growth. This tends to be the case with firms selling similar products and services. Engaging with sectors enables the government to identify and tackle sector-specific problems.
The Role of Government
The government works with sectors:
- to resolve individual sector-specific issues – these might include skills or labour shortages, developing new fit-for-purpose regulatory solutions, or the overcoming of trade barriers, and reviewing existing regulation
- to help develop comprehensive sector strategies and action plans for increased and sustained growth and innovation
- to guide the delivery of government services, for example, New Zealand Trade and Enterprise, the Foundation for Research, Science and Technology, and the Tertiary Education Commission.
Examples of Sector Engagement
In May 2002, the government established four taskforces for:
- biotechnology
- information and communications technology (ICT)
- design
- screen production.
These sectors were singled out because of their high growth potential. Also, their technologies and services enable significant activity across the economy generally. For example, firms in many industries can improve their competitiveness by using design to differentiate their products and services and lower costs.
Membership of these taskforces was made up of private sector experts and business leaders. Each taskforce produced a report with recommendations for industry and government. Recommendations focused on what might be required to realise each sector's growth potential and the potential of the respective technologies to boost economic activity and innovation generally.
To find out more, read the taskforces reports and supporting research [link to NZTE website].
In the 2003/2004 Budget, the government set aside a contingency of $110 million dollars over four years to implement initiatives in response to recommendations from these taskforces. In September 2003, Cabinet approved a suite of initiatives, including new initiatives in education, industry training, awareness raising, building management capability, and a set of new programmes to promote greater use of design by New Zealand businesses.
Read more about the September 2003 initiatives and the associated Cabinet papers.
In June 2005 the government released a progress report on the implementations of the Taskforces' recommendations. The report summarised key developments in each sector, provided information on implementation of recommendations and feedback from industry bodies. The annexes provided tables listing the Taskforces' recommendations, the intention behind the recommendation, the government response and key developments to date.
Wood Processing Strategy is one of the first of the "new types" of sector engagements. It was begun in 2000 because of the government's concern with promoting regional economic development in Tairāwhiti and later in Northland.
A lot of wood that was not needed for specific purposes became available in these two areas, offering an opportunity to improve the economic performance of the regional economies; however, many impediments needed to be addressed. These included skills and training, roading, trade access, and the development of markets for further processed timber. Elements of the strategy are still ongoing. It has now been applied beyond Tairāwhiti and Northland and has become a more generic strategy.
Food and Beverage Sector Engagement
The Government commenced formal engagement with Food and Beverage sector in February 2005. A Taskforce comprised of 18 industry leaders, the Minister of Foreign Affairs and Trade and the Minister for Economic Development will meet throughout 2005/2006 to identify growth opportunities for the industry.
Engagement with the Food and Beverage sector is the first step in implementing the Government's decision to engage with all sectors of economic significance over time. Continuing to improve the performance of the Food and Beverage sector is fundamental to achieving the Government's economic goals. The sector has considerable potential for continued growth, and is well placed to meet the challenges and exploit the opportunities changing global consumer trends and market conditions provide.
The engagement will involve stakeholders in thinking about the development of the sector, with industry identifying the actions and tasks that need to be taken to realise its full potential now and in the future.
General Purpose Technologies
Technological change usually takes the form of many very small changes. Occasionally new platforms are invented that result in a one-off step change in the economy and society as a whole. These are known as "general purpose technologies" (GPTs). Generally, the introduction of a GPT sees significantly higher levels of economic and social complexity, and organisations emerge that were not possible previously.
Examples of GPTs include:
- the domestication of plants (enabling the establishment of permanent settlements)
- writing (enabling retention and dissemination of knowledge)
- the electric dynamo (enabling, as one example, assembly-line manufacturing)
- ICTs.
GPTs are usually not a single technology, but a set of interlocking technologies that, together, can be used for a very wide range of applications. This is the nature of ICT, which includes telecommunications, digitisation of content, computers, and the Internet.
The introduction of a GPT causes reactive change. For example, work on digital technology and the Copyright Act 1994 was required to ensure the Act took account of the impacts of new digital technology.
A new GPT is also a catalyst for proactive change – individuals, businesses and governments innovate to take advantage of the new opportunities the GPT enables. Such innovation in the delivery of government services is essentially the thrust of the e-government programme. This programme has the goal of transforming the operation of government through use of the Internet by June 2010.
New Zealand's banking sector has also been radically transformed through the application of ICTs, so that today many banking transactions can be carried out anywhere at any time.
Realising the potential of a GPT to improve productivity growth requires not just access to the technology, but a wide range of complementary innovations in business, public institutions, and the community. In many cases, systems or processes need to be re-thought to take advantage of the benefits the GPT can provide. Policies are required to minimise risks, such as the increased potential that digitisation provides for privacy and copyright infringements.
Where to from Here?
Sector engagement will continue to be a key feature of industry policy in the future.
Sector engagement is likely to include:
- further full-scale sector engagements of the kind previously carried out with the wood processing strategy, and ICT, biotechnology, design and screen production sectors
- issue-specific engagements and continuing engagement by New Zealand Trade and Enterprise, the Foundation for Research, Science and Technology, and the Tertiary Education Commission.
Sectors selected for these full-scale engagements will have the potential to promote economic growth and "spillover effects" that are evident on a wider scale. Experience gained from past engagements will be applied in this future work.
Contacts and Links
Contact
Ministry of Economic Development
P: +64-4-472 0030
E: info@gif.med.govt.nz
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