SOE policy alarming - Business NZ

SOE policy alarming - Business NZ

Allowing state-owned enterprises to get involved in wider commercial activities is a mistake, says Business NZ.

Commenting on the SOE Minister’s advice to SOEs to expand their commercial undertakings, Business NZ Chief Executive Phil O’Reilly says nothing good will come from letting state-owned enterprises muscle in on the marketplace.

“It will squeeze out investment and lead to economic stagnation, not transformation,” Mr O’Reilly said.

“Central and local government are already competing against New Zealand companies in several areas, with harmful results.

“For example the Labour Department is directly competing against commercial firms in the provision of business advice. ACC, a state owned monopoly, is operating in an area that should be open to commercial insurance providers. Local bodies are using rates revenue to set up businesses in opposition to existing local companies. This kind of activity puts New Zealand taxpayers’ money at risk. It results in harm to Kiwi-owned businesses.

“For New Zealand’s future growth we need to focus on export opportunities. State-owned enterprises are by their nature domestically focused - this policy will do nothing for our export prospects.

“This directive to state owned enterprises is alarming, and New Zealand businesses urge the Minister of State Owned Enterprises to rethink the policy.”

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