Budget not great for business

BusinessNZ’s Kirk Hope says the economy should have had more attention in yesterday's Budget.  “The investment in infrastructure, training and digital skills will be appreciated, and a plan for a scheme to help unemployed people find jobs, however there is little focus on building the economy or easing the burden on business.  We’d appreciate seeing policies to stimulate growth, fix the housing crisis and bring more certainty around the route to Covid recovery.  For business, the Budget is a missed opportunity for growth.”

Budget - National's view

Investment in science and the economy, and tax write-offs for productive businesses would have been in National's Budget, National Leader Judith Collins told a BusinessNZ audience today.  'Fair pay' agreements would be off the table, and the housing crisis would be addressed by incentives for councils to issue building consents, along with emergency legislation for mass consenting for largescale housing development.  Workers and taxpayers would have been at the centre of National's Budget.

ACT's alternative Budget

ACT has released an alternative Budget focused on business needs, including a reduction in the top tax rates to 33% and 17.5%, a pause in minimum wage increases, rescinding new sick leave entitlements, repealing the oil and gas exploration ban, easing foreign investor rules, improving the consenting process for resource projects and reinstating interest deductibility provisions.  ACT Leader David Seymour said the Budget's focus should be on growing the economy rather than on taxation and redistribution.

Migrants bring benefits

NZ won’t be attractive to overseas investors without a workforce to meet the needs of business, BusinessNZ’s Kirk Hope says.  This week the Govt announced intentions to welcome more overseas investors while reducing entry for temporary and skilled migrant workers. “It’s not true that immigration pushes down wages - migrants bring many economic, social and cultural benefits, and they have kept our export industries going and cared for some of our most vulnerable people over the last year,” Kirk Hope said.

More focus on the economy please

Firms want more focus on the economy, according to a survey by Baker Tilly Staples Rodway.  The survey of 477 firms shows 71% think not enough is being done for economic recovery and 68% think the economy is not being managed well, while 60% want less Govt borrowing as part of its Covid response. Continual employment relations and other changes are creating pressure for businesses, and policymakers should understand that supporting businesses equals more support for workers, BTSR chair David Searle says.

Energy and transport cost survey 

Businesses are reporting big electricity and gas price increases as well as price increases for transport and logistics.  Higher energy prices are due to low hydro lake levels and gas supply constraints, and some firms also say it's hard to get new gas contracts.  Increased transport and logistics costs are due to Covid-related supply chain disruption.  BusinessNZ is surveying members to get an indication of how widespread these cost increases are.  You are invited to take the brief survey here