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Business Update - Friday, 5 Mar 2004

Business Update - Friday, 5 Mar 2004

WHY WON'T TREASURY DO THE NUMBERS? The select committee hearings on the Employment Relations Law Reform Bill started yesterday with an obvious line-up of business groups in one camp and union groups in the other. It's clear the major weapon the unions will use in the debate is the fact that the Treasury has said costs arising from the legislation will only be "modest". What they don't say is that Treasury has done no costings whatsoever to support their statement of "modest" costs. Why won't Treasury do the numbers?

REGIME SHIFT PREDICTED Business NZ's Simon Carlaw was first up before the select committee yesterday, saying the Bill would bring about a 'regime shift' that will become more apparent over time, with compulsory bargaining, compulsory arbitration and national award-type collectives offering less workplace freedom, restrictions on employers and employees, and diminished economic growth. He said it was completely unsatisfactory that the law was being pushed through without any financial analysis and without consultation with business. Check out:

FIRST SIGNS ALREADY Stopwork meetings are coming soon in 43 manufacturing companies that are part of the 'metals' multi-employer collective agreement (meca). The meca negotiations broke down last week when the employers rejected the union's proposal of a 5% pay rise, shorter working week and longer tea breaks. The engineers' union EPMU has given notice of the stopworks beginning on 12 March. It's a likely forerunner of increased industrial action under the proposed employment legislation which would make it compulsory for employers to join mecas if 'invited' to do so by a union. Contact:

SNEAKY INCREASE IN PETROL TAX, ROAD USER CHARGES Finance Minister Michael Cullen had been accused of further taxation by stealth following his very quiet "announcement" last week that petrol tax and road user charges for light vehicles would be indexed to inflation from 2006. It'll be a double whammy on top of the recent petrol tax and RUC increase that's meant to go towards better roads, and won't fix the problem of petrol taxes being siphoned off into the consolidated fund. The announcement was made late Friday - the traditional time of week for burying unpopular news. Contact

PICKET THREAT DRIVES BUSINESS AWAY Union threats have succeeded in driving business away from Dunedin. The Otago branch of the Maritime Union promised picket action to stop a stevedoring company using casual labour from coming to port. A fishing trawler using the stevedoring company was to unload at Port of Otago today but will now go elsewhere because of the picket threat. Dunedin misses out on business because of 'closed shop' local unionists.

NCEA IMPROVED LINK WITH WORKPLACE LEARNING ERO's report card 'tick' on the NCEA relates to areas where the business community also supports the new qualification - the NCEA enables students to take programmes at school that link in with learning in the workplace. The ERO report says 72% of schools have expanded the range of programmes on offer as part of implementing NCEA. What's needed now is a focus on ensuring that all school leavers attain at least NCEA Level 1, including the critical literacy and numeracy standards, as the beginning of a strategy to raise workforce skills. Surveys conducted by Business NZ show low skill levels by employees are a major problem for businesses. Contact

TRAINING MANAGERS FIND A VOICE Training managers from large and small companies gathered at Business NZ this week to form a representative group for self-help and advocacy. With a common interest in skill development linked to improved company and economic growth, the participants aim to have their voice heard on relevant national and local issues. More participants are welcome - contact



* Merchandise imports for Jan 2004 were valued at $2,591m, compared to estimated exports of $2,020m, giving a $571m estimated trade deficit. This is the largest January trade deficit since 1986. The value of imports was $199 million more than in Jan 2003.

* The increase in value of imports is to an extent due to increased imports of aircraft, vehicles and electrical machinery & petroleum products. Aircraft and armoured motor vehicles worth over $250m in total were imported.

* The increase was partly offset by a fall in crude oil (-$39m), this figure resulting from the often irregular intervals in which it is imported.

* Over year to Jan 2004, the value of merchandise imports was 0.7% ($227m) less than for the Jan 2003 year.


* The Producers Price Index (PPI) output index rose 0.4% during the Dec 2003 quarter, same as the previous quarter. Over the year, it rose 1.1% from the Dec 2002 to 2003 quarter.

* Electricity prices (+2.7% in the Dec 2003 quarter).were mostly responsible for increased output prices - this was the fourth consecutive quarter of increased wholesale electricity prices.

* Other increases occurred for business services (+1.6%) and construction (+1.1%), while prices fell for dairy product manufacturing (-1.4%) and wholesale trade (-0.3%).

* The PPI inputs index remained unchanged during the quarter, and virtually unchanged from the Dec 2002 to 2003 quarters (down 0.1%).

* The most significant quarterly rise came from meat & meat products (+1.9%), led by increased beef and pork prices. Electricity generation & supply prices were up 1.8%. The textile & apparel manufacturing index fell 3.6% on the back of lower prices for wool and skin.


* There were 244,300 visitor arrivals in Jan 2004, up 11% on a year ago, but the average length of stay fell from 28 days in Jan 2003 to 24 days in Jan 2004.

* Overseas trips by New Zealanders increased by 12,300 (18%) in the year to Jan 2004.

* Seasonally adjusted permanent and long-term (PLT) arrivals exceeded departures by 2,500 in Jan 2004, up from 1,500 in Dec 2003.

* The annual net migration gain was 33,300, down 15% on the previous year.


* There were 2,385 building consents issued in January. The trend series has been steadily moving upwards since April last year.

* Over the Jan 2004 year consents for 30,191 new dwelling units were issued - the highest total for a year ending January since 1977.

* Twelve of 16 regions had increased consent numbers for new dwelling units when comparing Jan 2004 with 2003, led by Otago (+102 units) and Wellington (+73 units). The largest decreases were recorded in Tasman (-18 units) and Canterbury (-10 units).

* The total value of non-residential building consents was $217m for January, compared with $262m for Dec and $255m for Nov. The highest dollar value of consents were recorded for office & admin buildings ($52m), factory & industrial buildings ($47m) and shops, restaurants & taverns ($47m). Over the year factories & industrial buildings stood at $358m, compared with $341.3m for the Jan 2003 year.

* Overall, while residential consents continue to trend upwards, non-residential consents remain flat.


* Business NZ submission on Employment Relations Law Reform Bill

* Treasury papers based on assumptions

* Quick Guide on employment Bill

* Business NZ welcomes NCEA report card

* Further fall in manufacturing activity


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