Innovation Intervention

PhilipD's picture
Submitted by PhilipD on Sun, 2013-03-10 04:03

Methven Limited, a designer, manufacturer and supplier of showerheads, faucets and hot water valves, is a publicly-listed company with a market capitalization of NZ$91,250,583. It pays its shareholders a healthy 7.3% dividend, and for the half year ended 30th September, 2012, reported an after-tax net profit of $2.3 million. Earlier this month Methven Ltd was awarded a Technology Development Grant, worth more than $2 million, by Callaghan Innovation.

Callaghan Innovation is not, as the name deceptively and disgracefully suggests, some private organization. Rather, it is a new Crown entity that believes its role is to “work across the whole innovation system to help businesses be more innovative and derive greater returns on that innovation.”

Anyone associate government with productive innovation? No, I didn't think so. In its first splash of other people’s cash Callaghan Innovation doled out more than $25 million to Methven and seven other New Zealand companies.

Callaghan employs more than 400 bureaucrats, second-rate scientists, researchers, technologists and account managers; nothing like meddling across the ‘whole innovation system’ to ensure an ever-expanding government, is there? And these folks, if they knew anything about innovation, should be making their fortunes within privately owned companies, shouldn't they?

Little chance that these government drones will get that message though as Callaghan is chaired by sucking-on-the-taxpayers'-tit, serial offender, Sue Suckling: the aptly named Suckling holds or has held directorships in, to name just a few, government entities such as NZQA, Antarctica NZ, AgriQuality NZ and she was a member of New Zealand’s Takeovers Panel. Most of Suckling's board share her passion for such government appointments.

Methven Limited CEO, Rick Fala and his board of directors' should be hanging their heads in shame rather than trumpeting winning the right to New Zealand taxpayers' money. But they are not.

“This grant will enhance our ability to drive new projects and speed up the commercialization of ideas already in our product pipeline,” said Fala.

No doubt. But why should Methven get a government-given advantage over its competitors, both existing and emerging, simply because Suckling and her motley crew believe them to be worthy?

And why don’t Fala and his board of crony-capitalists have the balls to refuse to take part in this unseemly giveaway of other folks' money? Surely as leaders of a publicly-listed company that collaborates with many other privately-owned enterprises, they recognize the overwhelming superiority of a market free of government intervention?

Apparently not. Can’t anyone stand on their own two feet?

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Methven is an interesting

Kiwiwit's picture

Methven is an interesting choice for an innovation award. I purchased one of their $300 award-winning Satinjet shower heads to replace an old one in my bathroom. It fell to bits while I was installing it but I managed to convince the retailer to replace it with another, which with great care I managed to install without breaking. It lasted less than 12 months. I replaced it with a $60 Chinese one that gives better spray and has been going strong for about 3 years now. I can see why they need a government subsidy.

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