Latest progress of Innovation and Technology Fund and funding injection proposal
Encouraging private investment in innovation and technology
Mr CHAN Chun-ying expressed support for the proposed injection into ITF as I&T was a key driver for economic development. Noting that Hong Kong’s GERD had reached $26.3 billion in 2019, up from $16.7 billion in 2014, Mr CHAN considered it necessary to drive the momentum for R&D from government-led to public-private participation, which would make R&D funding more sustainable. In this connection, he asked how the Administration would, under the prevailing difficult economic environment, encourage the private sector to invest more on R&D and strengthen cooperation among local universities, R&D enterprises and private companies.
PS(IT) responded that the Administration had all along been encouraging private companies to invest in R&D and partner with local universities. As a general rule, ITF required private companies to share the costs of the funded projects. For collaborative R&D projects, private companies were normally expected to contribute a higher proportion of the total project costs in order to be entitled to the ownership of the intellectual property (“IP”) rights arising from the projects. To further stimulate private investments in I&T, the Administration had, among other initiatives, provided private companies cash rebates equivalent to 40% of their eligible contribution to R&D projects under the R&D Cash Rebate Scheme, together with enhanced tax deduction for their spending on qualifying R&D activities.
Regarding the implementation progress of individual funding schemes under ITF, Mr CHAN Chun-ying asked about the reason why only five applications (up to end January 2021) had been approved under the Mainland-Hong Kong Joint Funding Scheme (“MHKJFS”) since its launch two years ago. He also enquired whether the training grant under the Reindustrialisation and Technology Training Programme (“RTTP”) at an average amount of about $14,000 (as at end January 2021) was sufficient to fund the relevant training in advanced technologies.
CIT replied that MHKJFS was introduced in April 2019 to support and encourage universities and research institutes in Hong Kong and the Mainland to conduct collaborative R&D projects, covering Mainland provinces outside Guangdong. Guangdong institutions would be covered by the Guangdong-Hong Kong Technology Cooperation Funding Scheme. Applications received under MHKJFS would first be assessed by the Ministry of Science and Technology and ITC separately. Then both sides would compare the assessment results and agree on a list of applications for further consideration. Only those supported by both sides would continue to be processed. Since MHKJFS was newly launched and because of the Coronavirus Disease-2019 (“COVID-19”) pandemic in 2020, a longer time was taken for both sides to convene panel meetings to assess the applications and then compare the assessment results before agreeing on the list of supported applications. Where appropriate, ITC would request the applicants concerned to refine their project proposals with reference to the panels’ comments. As at end February 2021, eight applications which were supported by both sides had completed the entire approval process. Another four applications were expected to be approved shortly. PS(IT) added that RTTP subsidized local enterprises to train their staff in advanced technologies. The amount of training grant at an average amount of about $14,000 was considered sufficient.