Joining AUKUS could boost NZ’s poor research and technology spending – but at what cost?

There is little doubt the National-led coalition is showing greater interest in the AUKUS security agreement, with Australian officials due to visit New Zealand later this year to brief the government.

So far, much of the discussion and analysis of New Zealand potentially joining the so-called “pillar two” of AUKUS has focused on the usual geopolitical and security narratives.

Australia is New Zealand’s only formal ally, New Zealand is already part of the Five Eyes spy network, and there are shared historical ties and values between Western states.

Like Australia, too, New Zealand has been walking a tightrope between its close trading relationship with China and its security relationship with the United States, as tension grows between the two superpowers.

Of course, perceptions of the strategic environment play a role. But they are far from the only motivating factor. In comments from the relevant ministers, and in briefing notes from department officials, it is clear economic arguments are being made in favour of New Zealand joining pillar two.

The government was elected, in part, on a platform of cutting public spending. At the same time, New Zealand under-invests in the research and development the government sees as essential for economic growth.

Given AUKUS is already a controversial initiative, any incentive to use it as a means to subsidise inadequate research, science and innovation budgets needs greater public scrutiny.

A change of heart

Under the previous Labour government, New Zealand put up a relatively ambivalent front on AUKUS.

Any involvement in pillar one (which provides for Australia to buy at least eight nuclear-powered submarines from the US and UK) was immediately ruled out, given its impact on New Zealand’s nuclear-free policies.

While the government left the door open to pillar two – which allows for collaboration on advanced technologies and building connections between defence industrial bases – there were seemingly conflicting views within the Labour Party.

While former defence minister Andrew Little seemed more open to the discussion, former foreign minister Nanaia Mahuta raised concerns about the impact it could have on New Zealand’s independence and relationships in the Pacific.

Read more: Moving closer to Australia is in New Zealand’s strategic interest – joining AUKUS is not

In opposition, the National Party was critical of AUKUS. Its then foreign affairs spokesperson, Gerry Brownlee, said the deal would not make New Zealand safer.

Now in power, however, National and its coalition partners appear to have a newfound enthusiasm for AUKUS. Defence Minister Judith Collins made it clear the government was considering what benefits AUKUS could provide New Zealand, and what New Zealand could bring to the table.

With Foreign Minister Winston Peters, she raised these matters in their meeting with Australian ministerial counterparts at the inaugural Australia-New Zealand Foreign and Defence Ministerial Consultations (ANZMIN) in early February.

Their joint statement said AUKUS makes “a positive contribution toward maintaining peace, security and prosperity in the Indo-Pacific”.

AUKUS economics

Economic factors appear to be playing a significant role in this tack towards AUKUS. A briefing by defence officials to the previous government listed eight “opportunities for New Zealand’s research community and industry”.

This focus on research is notable. Not only were the benefits outlined in the briefing, but it was also shared with the then minister of research, science and innovation.

As well as being defence minister, Collins is also minister for science, innovation and technology, as well as minister for space. It is unsurprising she would see harmony in these three portfolios when it comes to AUKUS. She has shown considerable enthusiasm for technology as a pathway to economic growth.

Read more: New Zealand is reviving the ANZAC alliance – joining AUKUS is a logical next step

Collins has pointed to the space industry as a key sector in which New Zealand could make a contribution. Technology and space are also the areas that, in Collins’ words, “offer opportunities to New Zealand businesses and scientists”.

At the same time, the government has requested budget cuts from its departments, including a 7.5% reduction from defence. State funding for research and development has long been inadequate, and this seems unlikely to change.

Interest in AUKUS, then, exists in a broader economic context beyond the obvious strategic defence considerations.

Time for a broader debate

The government clearly hopes collaboration on AUKUS pillar two can help provide something of a cross-subsidy for both defence and related civilian research and industries.

Many of the technologies involved – including space-related technology such as that used by RocketLab – are dual-use, meaning they have both civilian and defence applications.

Indeed, for several years now Australia has been building closer links in emerging technologies between its academic sector, defence and civilian industries.

Read more: AUKUS is already trialling autonomous weapons systems – where is NZ's policy on next-generation warfare?

It is important to understand these economic motivations. The prospect of New Zealand joining pillar two of AUKUS is already controversial at a geo-strategic level. If one of the primary motivations is also economic, some harder questions need to be asked.

Does it make sense to fund research, science and innovation via a defence partnership? And would that justify joining a controversial defence arrangement that potentially compromises other important international relationships?

The AUKUS question in general now needs to be considered in the context of broader debates about New Zealand’s role in the world, and the role of government in society.