The mathematically challenged Anthony Scott writes in this morning's Herald:-
"The real significance of the $700 million capital fund for innovation in the pastoral and food industries is in danger of being overlooked......"
The corrected version is:-
"The paltry insignificance of the $700 million capital fund for innovation in the pastoral and food industries is in danger of being overlooked....."
He goes on to say:-
"They are important issues and deserve close attention. But they miss the larger point of this announcement and attendant reactions.
The package does three things:"
After which he details not three but just two bullet points. Perhaps the missing 'thing' was the confusion sown by the package in the minds of those economic simpletons who who can't tell the difference between capital and income.
The best is kept for later however.
"With private sector contributions included, the fund may distribute up to $2 billion over the next 10-15 years."
Remember folks, the private sector is to contribute dollar for dollar. So, we have a $700 mil fund, earning interest at say 10%. Retain 3% for inflation proofing and you've got $49 mil to spend each year on scientific endeavour. (That's somewhere about the figure Jamdertin was talking.) Add the private contribution and there is about $100 mil per year, in real terms, each year, for 'the next ten to fifteen years.'
To use John key's immortal words, I'm buggered if I can see how that gets to two billion dollars.
One hundred million dollars per year is not really a hell of a lot when one puts it into perspective. Why, it's only 0.06% of Fonterra's turnover.
Maybe, Mr Scott has been taught to value investment by ANZ financial advisers or the good people from BlueChip.
Clearly he has been conned by the snake oil salesmen from Labour.