Politics of Tech: Labour’s Deborah Russell on her vision for a future-facing economy

Welcome to Politics of Tech, a regular feature from Caffeine in which we speak to the politicians shaping our country’s future and hear their pitch for building a vibrant, future-facing economy.

We’re starting with Deborah Russell, the former Minister for Statistics and the current Labour Spokesperson for Science, Innovation, and Technology. 

Welcome to Politics of Tech, a regular feature from Caffeine in which we speak to the politicians shaping our country’s future and hear their pitch for building a vibrant, future-facing economy.

We’re kicking off with Deborah Russell, the former Minister for Statistics and the current Labour Spokesperson for Science, Innovation, and Technology. 

Caffeine started by asking what she sees as the key barrier to growth for tech-focused startups in New Zealand.

“The particular pain point I would focus on is the one where they’re just trying to get outside investment so that a startup is going from the stereotype of building in your mother’s garage and trying to get over to the next stage,” said Russell. 

While Russell was cautious about the Government taking direct stakes in startups, she was interested in how NZ Super Fund, a crown entity still run independently, works in this space. 

The Elevate NZ Venture Fund supports investment in New Zealand companies that are moving beyond seed investment toward scaleup.

“Is that the point where the government can assist?” she said

“Maybe it’s some form of tax rebate. Maybe it’s a way of structuring the way you pay your provisional tax so that you can get some cash flow advantages to get you going. Maybe it’s the Government supporting venture capital in some ways.” 

When asked what would be a particular focus for a Labour Government on tech and small businesses, Russell pointed to the underutilisation of existing tools.

“In particular, it enables small businesses to really take advantage of some of the amazing stuff that’s out there now, which can seem quite basic. Both encourage individuals and enable small businesses to take up more tech to invest more in that part of their business.” 

At the other end of the spectrum, Russell (like us here at Caffeine) recently ‘had her mind blown’ by the deep tech aspirations of companies like Openstar, who are building a nuclear fusion reactor 20 minutes from the beehive.  

“It’s absolutely extraordinary. That’s the headline-grabbing stuff, and it’s incredible,” said Russell. 

But she quickly returned to perhaps less ambitious but tangible technology solutions that created more immediate gains, highlighting the all-in-one tax and accounting service Hnry in particular.   

“Setting up a fantastic way of handling tax can create a huge productivity gain for those businesses,” she said. 

“You’re not spending half your life trying to manage all this, wondering if you should call them, and wondering how to organise tax returns. It’s not necessarily a world-first idea or anything like that, but it’s something that adds to productivity in the country.” 

One sector that Russell’s Government took a direct role in supporting was video gaming. 

Australia offers up to a 45% tax rebate for game studios founded there. Following years of lobbying, the Labour Government introduced a competing 20% rebate in 2023.  

The National Government has since continued the scheme, but Russell isn’t particularly enthusiastic about it.   

“I’m a child of the 80s and 90s; I often think that the Government can go awry if it tries to pick winners,” said Russell.

“As a tax person, I’m not about rebates and the like. I like keeping our tax system relatively clean. However, I can see the advantage of supporting startups and helping people get going. We need to ensure, at the very least, that our tax system doesn’t stand in their way.” 

Of course, we couldn’t finish any conversation about technology without mentioning the most significant development of our time. 

Chat GPT is less than two years old, but progress has been exponential. Last week, OpenAI launched its much-hyped ‘Strawberry’ model, claiming it performs “similarly to PhD students in challenging benchmark tasks in physics, chemistry, and biology.”

While Europe, the US, and Australia are taking a more active role in regulation, the current National Government has taken a largely hands-off approach. 

But it’s not ignoring the space entirely. Technology Minister Judith Collins recently unveiled Gov GPT, a chatbot designed to help Kiwis easily find information about the Government and its agencies. Callaghan Innovation will run the pilot. 

“GovGPT is an exciting first step towards a vision of a ‘digital front-door’, where individuals can find answers to their questions about Government in a convenient and timely way,” Collins said.

Russell sees the obvious potential of AI tools and expects them to become widely adopted.

“We can’t just ignore it and hope it’s gonna go away,” she said. 

But Russell is concerned by the potential for supercharged misinformation and privacy breaches powered by generative AI models, particularly those with access to government data.  

“Statistics New Zealand has a whole lot of information, and 90% of us completed our census forms last year. Just imagine if you could pull down data and then use it to reverse engineer your way to someone,” she said. 

“Now Stats NZ releases data at a mesh block level and things like that, but could you use AI to spot patterns or loads of information that an ordinary human being might not?” 

With our economy contracting and increasing global instability, I finished by asking Russell for her advice on how startups should navigate the next 12 months.

“I’m not sure how long this is going to last. I hope that our tech firms are relying on broader markets rather than just New Zealand. I think people are not in a spending mood in this country at the moment.”

Perhaps because it’s not an election year, Russell noted a rare bipartisanship on her counterpart, Judith Collins.

“I think that the current minister is a champion for tech. I think that will give them heart.”