Government spending should support NZ industry and jobs

A government procurement policy that makes use of government buying power to develop high value services and manufacturing is vital to New Zealand's economy and long overdue, said CTU economist Bill Rosenberg, welcoming the announcement of a new policy from Labour.

"We welcome the fact that it requires government agencies to take into account the wider economic impacts of their buying decisions, rather than narrow lowest cost choices that look only at the interests of the agency or department's budget. The BERL study of the impacts of building Auckland rolling stock locally showed clearly how communities, jobs, skills, industry potential and government revenue can benefit from a broader view of what makes a good buying decision. It is shameful that New Zealand is missing out on such opportunities.

"We also welcome Labour's policy to require companies providing goods and services to the government to have an apprenticeship or internship programme in place for their New Zealand employees."

New Zealand governments should back New Zealand goods and services if we want to rebalance the economy. Industry Participation Plans are a good approach but need to have strong support through the tender process to maximize opportunities for local firms.

"Trade agreements have made good government procurement policies increasingly difficult to put in place, despite the fact that many other countries use them to help their economic development. We will be watching to ensure that the TPP negotiations do not make the situation any worse," said Rosenberg.

ENDS

© Scoop Media