Steady As It Slows Doesn't Close the Gap

Steady As It Slows Doesn't Close the Gap

"Dr Cullen's 'steady as it slows' Budget meets his criterion of few surprises but it doesn't bring the Government's own growth targets any closer to realisation", said Business New Zealand Chief Executive, Simon Carlaw, today.

"The Budget certainly includes several measures that we need to see more of, notably in the continued focus on skill development and workplace training and in bold new steps to help small companies grow jobs by reducing their tax compliance costs.

"There are, however, two hard realities: First, the good times are over. The last thirty months of solid economic achievement are at an end. The Government's ability to invest in New Zealand's future prosperity is about to become much more difficult as the options begin to shrink.

"Second, the Australian Budget, announced earlier this week, predicts future growth rates up to 1% per annum higher than New Zealand's. This means the current income gap will continue to grow and New Zealand labour and capital will cross the Tasman in search of better pay and returns.

"There are some critical calls coming up over the next twelve months that will directly determine New Zealand's growth prospects, for example, on roading, energy, labour market issues and other long-standing business compliance costs.

"Now is the time to prioritise future spending on ensuring more and better-paying jobs that only growth can deliver", Mr Carlaw said.

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