Financial executives feel the Coalition Government is unlikely to deliver the reforms needed to boost business growth and fix tax policy problems

Chief financial officers at some of New Zealand’s largest companies say the Coalition Government lacks a clear economic strategy and is too focused on cost-cutting and appeasing its minor partners.

These executives are responsible for managing a company’s finances, including overseeing investment decisions, controlling spending, arranging borrowing, and managing risks.

The ‘Mood of the CFO’ survey, compiled by recruitment firm Hunter Campbell and Infometrics, found most saw some opportunities for growth after a difficult year.

Only half had met or exceeded their targets and almost all expected ongoing macroeconomic, market, and regulatory challenges. 

But CFOs who responded to the survey reported having “little faith” that the Government understood the need for tax policy reform and a big picture economic strategy. 

Almost 80% believed government policies need to change to accelerate progress for businesses, although 56% also thought existing policies were “generally” supportive.

While 71% of these CFOs felt growth was a high priority for the government, 68% said there was unlikely to be any meaningful policy changes in the next year. 

“There is a general consensus that the NZ government needs to do more to support business and accelerate progress, but that working with government to achieve that is not straightforward,” the report said. 

Asked which policy settings needed reform, 30% of CFOs wanted more tax incentives to stimulate business investment, attract foreign capital, and support small enterprises.

“Respondents emphasise the need for policies that encourage capital investment, provide depreciation uplifts, and offer tax deductions for new assets, aiming to drive economic growth and increase business confidence,” the report said. 

Another 19% of respondents pointed to the Government’s “lack of strategic vision and coherence in policy-making” in areas such as infrastructure, healthcare, and immigration. 

The report said CFOs highlighted the Government’s “defensive mindset, focus on cost-cutting, and prioritisation of minority party policies over national needs, which they believe hinder long-term growth and development in New Zealand.”

Rome is burning

While not necessarily a majority view, this echoes criticism from business lobby groups who complain the Coalition is constantly bogged down in culture war distractions and hoping the economy will just fix itself.

The Newmarket Business Association criticised the Act Party’s Brooke Van Velden for spending her time reordering English and Te Reo words on passports, while the Auckland Chamber called for urgent fiscal stimulus to restart economic growth.

Viv Beck, chief executive of Auckland Central’s business association, told the Sunday Star Times she couldn’t understand why the Government was focusing on certain issues while “Rome was burning”. 

This survey confirms many finance executives, who hold New Zealand’s corporate purse strings, agree with many of these complaints. 

Recovery close?

Asked about this on Wednesday, Finance Minister Nicola Willis said everybody wanted to see the economy recover and investment levels to increase.

“It’s also the case that I hear consistently that people want to see the Government focused on the economy, on law and order, on health and on education, and that's why the National Party focuses on those things,” she said.

In a speech to Parliament later that day, she promised a stronger cyclical economic recovery was just three weeks away — citing a new set of forecasts from ANZ. 

“The bank's economists say that the economic recovery in New Zealand has been delayed by tariff uncertainty but not derailed,” Willis said. 

“While GDP growth almost certainly took a hit in the middle of this year, following tariff announcements, ANZ sees a stronger recovery taking hold from the fourth quarter of this year onwards as the full transmission of monetary policy to growth is realised.”

David Seymour, speaking on behalf of the Prime Minister in Parliament, said the country was emerging from a cyclical recession caused by high interest rates . 

“What happens subsequent to that, is that interest rates fall, people have more money at the end of the week—they spend more—and you see businesses starting to hire again. As I go around New Zealand, I hear many stories that the better part of that cycle, under this Government, is coming into fruition,” Seymour said. 

Survive till ‘25 ...‘26

Many voters are frustrated by the lack of economic growth, having expected the recovery to be felt at the start of 2025. A Taxpayers’ Union–Curia poll from August found a majority thought the country was headed in the wrong direction.

The Labour Party has been capitalising on this sour mood. It has seen a six percentage point increase in its polling relative to the 2023 election and could plausibly win in 2026. 

But it is yet to announce any policy and will face more challenges when pushed to explain how it would do things better than the Coalition, and how it would pay for it.

The CFO survey had a piece of good news on that front. Some 8% of respondents said broadening capital gains taxes was the most needed piece of reform, while another 6% want fixes for “housing affordability and property speculation”.

Labour Party leader Chris Hipkins said business leaders around the country had sent him a “resounding” message that New Zealand needed to broaden its tax base.

“They also want to see NZ’s investment focus shift away from residential housing, and our obsession with residential housing as a form of investment, to one that goes back to viewing residential properties primarily as a home, and that we instead focus our investment on the productive economy,” he said.

However, there were fewer CFOs calling for a capital gains tax than there were asking for “high” corporate and personal income taxes to be lowered (15%).