October 31

Business leaders call for a clear plan on growth

Deloitte-BusinessNZ survey offers insight into what business thinks are the most crucial issues facing the nation

The business community is calling on the next government to provide a clearer blueprint to lift the country’s economic performance and to involve business more in its implementation.

This was one of the key survey findings presented to business leaders at the Deloitte-BusinessNZ Election Conference held in Wellington today.

In presenting some of the survey’s most important results, Deloitte CEO Murray Jack noted that two-thirds of business respondents either don’t think or are unsure the government has a clear plan to lift the country’s performance.

While most businesses are broadly support of the current economic direction, particularly moves towards a broad base, low rate tax system, there is a strong desire to see a clearly articulated set of principles that guide fiscal and regulatory decision-making and policy implementation.

“If New Zealand is to achieve the standard of living to which we aspire business needs to be successful, and its success will be more certain if it operates in a supportive policy environment,” Mr Jack says.

Savings is another critical area that business is seeking more clarity from the next government, with more than 80% of businesses believing it is time the government looked at the eligibility age for NZ Superannuation.

Mr Jack says savings is clearly looming as a major battleground in the election, although much of the policy discussion has been confined to whether or not KiwiSaver should be compulsory.

“The problem any government faces here is the fiscal cost of compulsion under existing incentives for the scheme. It is also not sensible to make changes to KiwiSaver without also considering NZ Superannuation and the NZ Super Fund.”

Among other key findings, the survey reconfirms concerns of business that school leavers are not well prepared to be effective in the workforce (over two thirds of those surveyed), and even over a third of business leaders believe tertiary graduates are ill-prepared. As a result, more than 86% of businesses surveyed believe the government should provide more focus on raising language and numeracy skills.

One area business is looking to become increasingly involved with government is in developing the country’s infrastructure, with 82% of respondents in the survey wanting greater participation by the private sector in publically funded infrastructure. A significant proportion – 84% – also supports the current government’s plans for mixed ownership of some state assets.

The survey also showed the employment environment is of crucial importance to business, with more than 70% of respondents opposing the union monopoly on collective bargaining and 65% favouring a return to youth rates.

“Young people need all the help they can get to get into the workforce, so raising the price of their labour to that of skilled and experienced workers seems unhelpful,” Mr Jack says.

The Deloitte-BusinessNZ Election Conference was attended by more than 250 business and industry leaders, and representatives of the main political parties. The survey presented at the conference was conducted in September and was compiled from the responses of more than 1300 BusinessNZ members.

ENDS

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