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Security Fee Just Another Tax


Security Fee Just Another Tax

United Future's Gordon Copeland stood up for business concerns in Parliament today with an attack on the Government's proposed new border security fee, claiming border security as a public good that should be funded from taxes, not by business. The fee's to be imposed on export and import businesses to fund security x-ray machines and extra staff needed to meet the Government's response to new US security requirements. It was announced nearly two months after a select committee had finished hearing the views of parties affected by the Border Security Bill and will be introduced by a supplementary order paper, bypassing the select committee and public scrutiny. It took the business community by surprise since there had been opportunity for consultation in numerous meetings with Customs before the announcement. In 1999 the Labour Party in opposition

CARBON CREDITS MARKET THREATENED The EU will challenge the whole concept of carbon sinks at an international Kyoto conference next month: some EU groups want the carbon sink rules made subject to poverty reduction and biodiversity requirements, while others say carbon sinks distract attention from the main goal of reducing dependence on fossil fuels. The World Bank says EU objections to carbon sinks could destroy the whole idea of a carbon credits market. This would be an unfortunate outcome - the carbon credits market is one of the few beneficial features of the otherwise ineffective Kyoto Protocol.

NICE WORK IF YOU CAN GET IT Meanwhile, NZ's 'negotiated greenhouse agreements' (NGA) initiative is now under way. NGA negotiations are about to start with four companies - ACI Glass, Norske Skog Tasman, Newmont Waihi and GRD Macraes. They'll be exempt from carbon taxes in return for moving towards world best practice in managing greenhouse gas emissions. The question is - why can't every NZ company get the same deal? Contact pwhitehouse@businessnz.org.nz .

ERA REVIEW TO SURFACE SOON The PM says the Employment Relations Act Review process will begin next month. Draft legislation is expected in Parliament on 1 December. The fear is that the review will contain the unpalatable bits that were cut out of the ERA Bill in 2000, but that can't be confirmed, as there has been no consultation with business over the process.

THREE GET IT RIGHT Lack of coordination between state agencies is often the root of service failure. In the critical area of education, skills and the economy, three state agencies seem to be getting it right. The Tertiary Education Commission, Trade and Enterprise and the Foundation for Research, Science and Technology said this week they would co-ordinate their decision-making and importantly, their allocation of funds: "This will be a long-lasting partnership... to identify priority areas of business and industry around which our three agencies will focus." Contact jbaker@businessnz.org.nz .

ANNE KNOWLES TO ASIA Business NZ's Anne Knowles departs soon for an ILO role developing employer organisations throughout Asia. Her area of responsibility will include major economies China, Japan and Singapore and significant developing economies Vietnam, Cambodia and Laos - a positive reflection on advocacy work undertaken by Anne and Business NZ.

GROWTH STATS

CONSUMPTION UP, SAVING DOWN

* GDP increased 4.8% and prices increased 4.4% in the March 2003 year.

* National disposable income rose 4.6% (lower than the 9% increase in the March 2002 year). The two key components of national disposable income (compensation of employees and business profits) rose by 6.2% and 1.6% respectively (though both were down on the March 2002 year increases).

* Although national disposable income increased 4.6%, final consumption increased by 6.1%. This means national saving as a percentage of national disposable income fell from 6.1% during the March 2002 year to 4.7% during the March 2003 year.

* Capital investment rose, with fixed assets growing strongly for the second successive year (+8.7%), led by spending on new housing (+28.8%) and road vehicles (+22.2%).

UNEMPLOYMENT AT 16-YEAR LOW

* The Sept unemployment rate for the Household Labour Force Survey was lower than expected, falling 0.3 percentage points from the June quarter to reach 4.4% for the Sept quarter. This is the lowest unemployment rate since Dec 1987, and highlights a tight labour market where finding employees is becoming increasingly difficult.

* It was the 13th consecutive increase in employment numbers, rising by 26,000 to 1,939,000, while the number unemployed fell by 6,000 to 88,000. The number not in the labour fell for the first time by 5,000 since the March 2002 quarter, lifting the labour force participation rate to 66.6%, one of the highest rates on record.

* Much of the employment growth occurred in Auckland (+23,900). Of the 11 other regions, only five showed an increase in the number employed. Unemployment is highest in Northland (8.3%) and Otago (5.9%).

* Over the Sept year employment declined in the business & financial sector (-10,400) and in manufacturing (-8,800).

STRONG RISE IN PUBLIC SECTOR WAGES

* The Labour Cost Index (LCI) shows tight labour market conditions pushing up wage rates, especially in the public sector, where wages rose 1% over the Sept quarter, giving an overall salary and wage increase of 0.8%.

* Over the Sept year salary and wage rates rose 2.3%, on top of similar increases for the June and March years. Increases in annual wage rates are the highest since the Sept 1997 quarter.

* Biggest increases were for communications (+1.8%) and education (+1.5%) employees. Wages in construction were up 2.5% over the Sept year, the same result as the June 2003 year and the highest peak since the LCI began in 1992.

SHOPPERS BAG GOOD DEALS

* Quarterly retail sales for Sept were up 2.3%. The core-retailing group (excluding motor vehicle retailing and services storetypes) increased by 2.1%. Total sales volumes rose 2%.

* All but one of 15 storetypes had higher seasonally adjusted sales during the Sept quarter. The largest dollar value increase occurred in motor vehicle services (+$62m) and department stores (+$59m).

* Seasonally adjusted sales rose 2.2% during the Sept quarter in the North Island, led by the Wellington region (+2.8%). Sales in the South Island were even stronger (+2.6%), with Canterbury achieving only a 1.9% increase but the remainder of the South Island recording a 3.4% increase.

* These results are consistent with a booming housing market, increasing incomes and a tight labour market. With the $NZ continuing to appreciate, retailers have been able to drop prices for some imported items, providing extra incentives for consumers to buy. Although falling retail prices generally mean less pressure on tradeables inflation, the Reserve Bank may not consider this enough to counteract rising domestic inflation and may increase interest rates sooner rather than later. courtesy www.stats.govt.nz

JOBS ADS STILL RISING

* Job ads for Oct increased 2%, building on two modest increases for the previous two months. Job ads are now higher than at any point since Sept 2001, except for a spike in Oct 2002.

* Waikato was the only North Island region to experience a fall in job ads (-7.4%); Manawatu was top (+6.2%), followed by Hawkes Bay (+3.5%).

* Both job ads series in the South Island fell; Otago was down 7.2% and Christchurch 3.4%.

* For the first time since May the Internet job ad series fell, down 2.3% from Sept. Over the Oct year the series was still up 5.7%, but 14.8% lower than its April 2001 peak. courtesy www.anz.co.nz

WHAT'S NEW on www.businessnz.org.nz

* Unbundling is high risk

* Anne Knowles takes on employer role in Asia

* RMA amendment - more of the same

* Think 'Green' when you next see red while stuck in traffic

* Submission on corporate governance

* ACC listening

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