Government Imposed Costs Give Lie To 'Innovation Strategy'

ACT Finance Spokesman MP Rodney Hide said today that the extra $26,000 that Helen Clark's government has imposed on medium-sized businesses makes a mockery of her over-hyped and far-fetched `Innovative New Zealand' strategy, now known in business circles as her `Business by Talkfest' policy.

"Helen Clark has been a Black Death to small start-up businesses. She's hiked taxes, re-nationalised accident insurance, re-monopolised the workforce, and loaded charges on businesses from Union Education, Paid Parental Leave, through to Health and Safety fines for "stress" and "fatigue".

"One small business owner has told me that he survived the Asian Crisis but he's not sure he can survive Helen Clark. That's how serious it is.

"The report by Business New Zealand is conservative. It ignores tax changes. But it does pick up the often hidden costs of New Zealand businesses shouldering small changes to fringe benefit tax, to large-scale employment law changes. The cost on a small business is $26,000. The accountant's advice is, "I strongly recommend against your planned building expansion and advise no further hiring".

"New Zealand is puddling along at only two to three percent growth, despite having the best economic conditions since the 1960s - our economy has been buoyed up by a strong world economy, high commodity prices, favourable weather and a low dollar. That's masked much of the impact of Helen Clark's policies. But business is only coping in the so-called good times.

"Treasurer Michael Cullen's great aim is to lift New Zealand to four percent growth in five years time. Five years ago - until Winston Peters' spend up - we had averaged four percent growth each year for five years! Back then Michael Cullen was ranting and raving in opposition about New Zealand's poor economic performance. Now his promise is to get us back in five years' time to where we were five years ago. His own Treasury forecasters say that under this government's policies he hasn't got a chance.

"The way to help New Zealand prosper is not with slogans, talkfests, taskforces and committees as this Government proposes. It's with real policy to reduce taxes and to reduce business risk by making our laws simpler and clearer and easier.

"Helen Clark is right about one thing. The economy is an election year issue. It's an issue she can't win on," Mr Hide said.

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