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Business NZ says red tape, corporate tax levels and labour market polices such as Fair Pay Agreements should be addressed in the coming election

Public Policy / news
Business NZ says red tape, corporate tax levels and labour market polices such as Fair Pay Agreements should be addressed in the coming election

Business NZ has issued its wish list for the coming election, and as expected, liberalisation of the labour and foreign investment markets figure prominently.

The information comes in a new document that Business NZ thinks all political parties must deal with if New Zealand is to prosper.

One of the business lobby group's main targets are Fair Pay Agreements (FPA), which it nicknames 'Forced Pay Agreements.'

These were passed by the current government to give workers in the same industry across New Zealand access to similar pay and conditions. The Government said it would protect vulnerable workers from exploitation.

But Business NZ says FPAs work against this, saying high-quality, well-paid jobs come from a dynamic labour market where individuals can readily adapt to changing market conditions.

“Poorly thought through, ideological and highly damaging regulation, such as FPAs will make our labour market less responsive and less competitive,” says Business NZ.

“This is at the time when responsiveness and competitiveness are needed more than ever.”

Business NZ says FPAs impose ‘one size fits all’ pay rates on entire industries, regardless of individual business scale, location or market circumstances.

It adds they remove much of workers’ ability to have their performance appropriately rewarded, as well as much of employers’ ability to negotiate freely according to the needs of their company.

Business NZ also wants to restore 90-day trial periods for employees across all industries, not just for SMEs. It says this system will enable employers to make the right choice when employing people, particularly if that choice involves risk because of a would-be employee's set of skills or previous work history.

It says allowing 90-day trials would actually increase labour market participation, not reduce it.

Business NZ also wants better vocational education and streamlined immigration systems. It also questions the minimum wage, saying it has increased 40% since 2017 and suggests this is mainly due to politics.

“(The Government should) establish a stable, predictable, and depoliticised minimum wage setting process to allow businesses time and confidence to respond to rising costs,” it says.

Business NZ also argues there is too much red tape in this country.

“New Zealand has long been seen as a good place to do business because of our predictable, stable and evidence-based regulatory environment,” it says.

“Sadly, that reputation is increasingly under threat. Businesses and potential investors tell us that they now see increasing regulatory uncertainty and risk which negatively impacts business confidence and foreign and domestic investment certainty.”

It adds the pace of change, along with rapidly increasing compliance costs are adding frustration and fatigue to business managers.

“ A rapidly increasing regulatory burden of this type impacts small businesses in particular, including those in rural and regional New Zealand.”

On monetary policy, Business NZ wants the Reserve Bank to focus on price stability alone, and suggests the Government should be careful not to make things worse with too much spending.

It adds New Zealand corporate tax rates are high by OECD standards, and suggests the Government should instead adopt a broad-based, low-rate tax system that is indexed to inflation.

The cost of tax compliance should also be reduced by simplification, automation and innovation at the IRD.

“The tax system should assist taxpayers, not the other way around,” it says.

And Business NZ has a word to say about Māori business, which it says has been growing faster then the economy as a whole.  But it notes some Māori enterprises are owned collectively and it wants the Government to address the reluctance of banks to lend to the institutions with multiple owners.

And on trade, it supports moves towards a rules based system and more free trade agreements. It wants the Government to help enhance public support for the latter.

Business NZ adds it continues to support New Zealand’s bipartisan approach to climate policy, but it says there is a lack of consistency, certainty and predictability in government policymaking at the operational level.

It says an overly detailed and prescriptive approach too often puts government regulation at the centre, creates investor risk and leads to overly expensive emission reductions.

“We need to improve the engagement of SMEs in transitioning to a lower emissions economy. This could be both by enabling access to suitable finance instruments to transition to net zero and through non-financial support (training, tools, information etc) on how they can advance their low emissions transition.”

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Great list. Can't wait for it to be implemented.


This comment section is fair representation of what NZers think of special interest, and especially corporate funded lobby groups. Not really worth commenting on.


“ A rapidly increasing regulatory burden of this type impacts small businesses in particular, including those in rural and regional New Zealand.”

A good point and an argument for more work on localism - small local economies perhaps setting some policies particular to their socioeconomic demographic.   Careful consideration needed so as not to exploit workers, but we have very diverse economies from a geographical perspective.



Yeah but so many of these business lobby groups just wave their arms about and say rapidly increasing regulatory burden. The lack of actual examples given is noticeable.


I can’t help but laugh at their criticism of the FPA’s. One of the main reasons for its implementation is to stop the exploitation of workers in small workplaces in the same industry who end up getting paid less than their peers in larger workplaces who have some negotiating power. Hear hear I say. Look after your people businesses and they will look after you.


Basically Business NZ wants to continue screwing workers with impunity.