Mood of the Boardroom: Mixed reception for Greens (NZ Herald)

Mood of the Boardroom: Mixed reception for Greens (NZ Herald)

Business leaders are divided on whether James Shaw and Marama Davidson’s leadership has positioned the Green Party as a credible coalition partner with a Labour-led government. Some 47 per cent say their leadership has helped; 41 per cent hold an opposing view and 12 per cent are “unsure”.

When evaluating their political performance over the past three years, Shaw was praised by CEOs, receiving a score of 3.16/5 on a scale of 1-5, where 1= not impressive and 5= very impressive.

Many applaude his climate policies and adeptness at fostering collaboration across the political spectrum.

“James Shaw’s commitment to addressing climate change and efforts to achieve cross-party alignment where practicable is worthy of recognition,” says Beca chair David Carter.

Shaw’s most notable achievements include successfully shepherding the Zero Carbon Act through Parliament with unanimous support, and reforming the emissions trading scheme.

In the current term as climate change minister, Shaw has collaborated closely with company directors to shape the Financial Sector (Climate-related Disclosures and Other Matters) Amendment Act, which imposes mandatory climate-risk disclosures for large listed companies and financial institutions.

The head of a large asset management firm also acknowledges Shaw’s effectiveness in steering climate policies in a direction that is likely to survive changes in government.

“He may not be rewarded for that by his own voters, but it’s the right way to approach a problem that will require action across multiple electoral cycles.”

A prominent corporate director says, “James Shaw is impressive, and his orientation is genuinely green, rather than watermelon,” referring pejoratively to politicians who combine social and environmental goals.

Last year, Shaw was ejected from the Greens’ leadership by a minority of party delegates who thought he was too close to the Labour Party and not strong enough on climate change. Although he was comfortably re-elected six weeks later, there is concern from some CEOs that this weakened his leadership.

“James Shaw has all but become irrelevant since then — even Labour didn’t bother letting him know about his own portfolio,” responded the boss of an energy firm.

“He looks weak and is having influence in less and less policy.”

This related a government savings initiative which included $236 million for climate policy. Shaw was unaware of this until after the announcement had been made by Prime Minister Chris Hipkins and Finance Minister Grant Robertson.

In contrast, CEOs have little positive to say about Davidson, with some labelling her as an “extremist”, and expressing scepticism about her financial policies and proficiency.

For her co-leadership, Davidson received a score of 1.75/5.

“Marama adds little value,” responded a banker.

Davidson faced criticism for remarks she made at a trans rights rally in Auckland earlier this year when she blamed “white cis men” for causing violence. She later clarified that she had been in shock from being struck by a motorcycle.

“I should have made clear that violence happens in every community. My intention was to affirm that trans people are deserving of support and to keep the focus on the fact that men are the main perpetrators of violence.”

If the Greens get to play a role after the October 14 election, several Green Party MPs could be up for Cabinet jobs, among them Chlöe Swarbrick, the Greens spokesperson for a host of portfolios including economic development, digital economy and small business, whose performance was rated at 2.51/5.

Erica Crawford, founder of Loveblock Wine, says that Swarbrick is impressive.

“With some life experience under her belt, she could provide strong leadership as Prime Minister.”

Spokesperson for building and construction, energy and resources and finance, Julie Anne Genter, received a score of 2.10/5.

Policies

CEOs also rated some key Greens’ key policies on a scale of 1-5 where 1 equals “very poor” and 5 equals “very good”.

The highest score of 2.95/5 was the Greens’ policy to provide homeowners up to $36,000 in grants and loans to make their homes more energy-efficient and healthy.

They also proposed to allow landlords to deduct the tax from $18,000 of upgrades made to up to two rental properties.

Also scoring 2.95/5 is the party’s policy to develop a climate-resilient national food strategy, to ensure New Zealand’s food production is resilient to a changing climate, and work with Māori to ensure their food sovereignty aspirations are included.

The Greens have gone further than Labour on its dental policy, offering free dental care for all rather than for those aged under 30.

They plan to pay for this through a new wealth tax, paid by couples worth more than $4 million after mortgages and other debts, and individuals worth more than $2m.

This policy resonates with some respondents, although they disagree with the Greens’ proposal to fund this through introducing a wealth tax.

“They have a strong group of supporters and their dental policy seems to have been well received,” says Jarden managing director and co-head of investment banking Silvana Schenone.

A banking CEO responded that free dental care for those who can’t afford it and for children is excellent policy, “but not for those that can afford it, and not paid by a wealth tax”.

Consistent with past years, business leaders expressed reservations on the challenges faced by a party championing both environmental preservation and social issues.

“I am concerned that any coalition opportunity would be held hostage to the need to ram down more extreme positions, which would inevitably lead to instability,” says an agricultural industry leader.

“The pivot to social issues without credible solutions has taken the Greens to a different political space and possibly relevance,” says the chair of a management consultancy.

“The Green Party could contribute so much to sizing and solving externalities like climate change,” responds another chair.

“Then their ideology kicks in with cutting cow numbers and at that point I sigh and switch off.”

Mood of the Boardroom: CEOs see talent in Nats’ front bench (NZ Herald)

Mood of the Boardroom: CEOs see talent in Nats’ front bench (NZ Herald)

CEOs believe the National Party possesses a formidable pool of talent capable of leading a new government, should they be given the opportunity.

The Mood of the Boardroom survey asked them to rate each of the top 10-ranked National MPs.

Topping the list of National’s front bench in the eyes of CEOs is deputy leader and finance spokesperson, Nicola Willis, who received an impressive score of 4.19/5. This is on a scale of 1 to 5 where 1= not impressive and 5= very impressive.

Erica Stanford, spokesperson for education and immigration, was rated 4.02/5 and Chris Bishop, in charge of infrastructure, housing and RMA reform, earned a score of 3.68/5.

The head of a large asset management firm expressed some disappointment in Bishop’s recent U-turn on the bipartisan accord for townhouse zoning that allows developers to build more medium-density homes within existing urban areas.

“Chris Bishop is likeable and capable, but his walk back will make it much harder for New Zealand to address housing affordability, infrastructure and climate change.

“He is smarter than this, so perhaps it just reflects an attempt to win over small-minded voters?”

Health spokesperson Dr Shane Reti came in fourth, scoring 3.68/5 — just ahead of leader Christopher Luxon with a rating of 3.37/5.

Even the lowest scoring of the 10, former party leader Judith Collins, received a reasonable score of 2.79/5.

Collins is National’s spokesperson for science, innovation and technology, along with foreign direct investment, digitising government and land information. She has been particularly active and adaptive in her roles after losing the party’s leadership position. Collins says a willingness to be interested in whatever comes her way has been part of her longevity in politics.

Although she wasn’t specifically asked about, a CEO in the education sector called out first-term MP Penny Simmonds as “impressive”.

Simmonds had been in charge of the Southern Institute of Technology (SIT) for 23 years, which offered zero fees for locals and long-distance students. Ranked 16th on the National Party list, she is tipped as likely to become the minister in charge of unravelling the amalgamation of polytechnics into the single entity Te Pukenga, should the National Party form the next government.

Mood of the Boardroom: No shortcuts – we’re not Venezuela (NZ Herald)

Mood of the Boardroom: No shortcuts – we’re not Venezuela (NZ Herald)

The next Government could conceivably liquidate the $65.4 billion New Zealand Super Fund and renege on making offshore payments on climate change commitments to pay down costly Government debt.

But such stratagems don’t fly with New Zealand’s senior corporate community.

In the Herald’s 2023 Mood of the Boardroom CEOs survey, business leaders were emphatic; over 87 per cent sent a strong message that liquidating the fund was not on. Just 3 per cent said it should be used to restore the country’s balance sheet. A further 9 per cent said they were “unsure”.

A high-profile chairperson suggested that — given the poor fiscal management seen in recent years — rating agencies would respond very negatively in such a case. “The New Zealand Super Fund and investment expertise can instead be used far more effectively to support infrastructure build.”

But New Zealand Initiative chairman Roger Partridge is in favour of “ideally winding the fund up” and paying down debt.

The fund is designed to help pay for the rising cost of providing National Superannuation payments for New Zealanders. Both Labour and National have flagged they will continue making contributions.

National’s finance spokesperson Nicola Willis said her party is committed to continue contributions.

“I do think it’s prudent and responsible to always be looking at … is that the best place to be putting our dollars now? But my intention is that we would continue contributions,” she told TVNZ’s Q+A earlier this year.

Labour has also committed to continue payments.

In its alternative budget, Act has proposed halting contributions to the Super Fund while government debt is outstanding. It suggests, “if taxpayers wish to invest in the stock market, they are allowed to do so.

“The Government should not force them to do so via proxy.”

It applies the same rationale to the government’s venture capital fund.

In 2009, the former National-led government halted contributions in response to the Global Financial Crisis. They were restarted by the Labour-led government in 2017.

Simplicity founder and CEO, Sam Stubbs, says liquidating the fund would eliminate a world-leading investment team that has provided returns to taxpayers well in excess of any debt required to fund it.

“Ultimately our increasing public debt has to be paid back,” adds Precinct Properties chair Craig Stobo. “If the public does not want to cut entitlements or increase taxes we have to sell assets. There are state assets that should be sold well before the NZ Super Fund is liquidated.”

A former banker draws a historic parallel: “Not a good idea. It would be similar to doing away with the Superannuation fund by Muldoon.”

Jarden’s managing director and co-head of investment banking, Silvana Schenone, acknowledges the complexity of superannuation. “I believe compulsory superannuation in New Zealand would assist with financial literacy and many other issues the country is facing,” she says.

Paying the Piper

A Government report has forecast we could be up a $24 billion bill leading up to 2030 in order to meet its international climate change targets.

This projection is predicated on maintaining our current greenhouse gas emissions trajectory without significant reductions, against a high international carbon price to offset emissions above the country’s target.

Under the Paris Agreement, New Zealand has committed to reduce net greenhouse gas emissions in 2030 by 50 per cent below gross emission levels in 2005; part of global efforts to limit warming to below 1.5C.

Business leaders were asked if the country should renege on these commitments and focus on investing in green technology and other direct emission-reducing measures.

A clear majority of respondents, 62 per cent, answered a resounding “no”. They emphasised the importance of such commitments as a vital aspect of global co-operation in combating climate change, and the severe implications walking back commitments could have on New Zealand’s trade relationships.

Conversely, a notable 18 per cent of respondents aligned with the idea of prioritising investments in green technology and direct emission reduction measures over strict adherence to international commitments. The remaining 20 per cent of respondents are “uncertain”.

Professional director Dame Therese Walsh says, “the credibility of New Zealand in relation to climate change globally will be significantly impacted if we do not meet our international commitments.” She notes our absence would undermine the level of pressure on other countries to do the same.

Another director makes the point that if we renege on the climate commitments our relative cost of capital will increase.

“The economy gets hit both ways on this. The only answer is to have a co-ordinated plan to deliver to the targets that the Govt does not undermine with policy decisions, like providing fuel subsidies.”

“It is not an either/or question,” says Freightways chair Mark Cairns. “We need to be doing both.”

But conversely, a notable 18 per cent of respondents aligned with the option of prioritising investments in green technology and direct emission reduction measures over strict adherence to international commitments. The remaining 20 per cent of respondents were uncertain. Precinct Properties chair Craig Stobo is sceptical of the feasibility of achieving the 2030 Paris targets, “both in terms of likely success and ballooning taxpayer costs.”

“Only 25 per cent of the globe is subject to carbon taxes or prices. We should work with other food exporters to opt out under Article 2.1 of the Agreement citing food security.”

Going further, serial social entrepreneur Anne Gaze strongly criticised the decision to sign the Paris Agreement.

“Phenomenal incompetence to have even thought of signing this! What a puffed up Minister’s ego to have done so.”

Mood of the Boardroom: Escalating costs prove a big concern (NZ Herald)

Mood of the Boardroom: Escalating costs prove a big concern (NZ Herald)

Business chiefs have sent a strong message to the Labour Government concerning the escalating costs associated with conducting business.

When asked whether government actions over the past three years have elevated the cost of doing business, a resounding 93 per cent of respondents to the Deloitte and Chapman Tripp election survey, conducted by BusinessNZ, said “yes”. Just 5 per cent of respondents said “no”, while 3 per cent were “unsure”.

Data from Statistics NZ shows that profit margins for businesses are lower than pre-Covid levels. Price increases for the non-financial sector of the economy show that 75 per cent of inflation in the three years to 2022 has come from the increase in the cost of inputs (goods and services) and the remainder is evenly split between wages and profits.

Taking a closer look at this in the survey’s findings, a notable 64 per cent of respondents say that their tax compliance costs have increased over the last three years. Just 1 per cent say that costs have reduced, while 36 per cent say that costs have remained the same.

Three Waters

Earlier this year, the Government unveiled its shakeup of the Three Waters reforms.

After considerable pushback from councils, it abandoned its original plans to establish four mega water entities, and instead has proposed creating 10 water entities under the umbrella, Affordable Water Reform. It says this new structure strikes the right balance between ensuring cost savings in the delivery of water infrastructure, while also ensuring that the water entities are strongly grounded in their local communities.

Labour says that the cost of fixing the country’s broken water infrastructure is estimated at $185 billion over the next 30 years, and that local councils cannot afford this on their own. They suggest that households in some areas could see rates rise up to $9730 per year by 2054 if nothing is done.

Business chiefs were asked whether they believe region-focused delivery of Three Waters services by new public sector entities that are separate from territorial local authorities will bring about the types of economic gains that the Government has outlined.

They are not convinced, with 80 per cent of respondents saying it won’t. Only 8 per cent said it will deliver substantive economic gains, while 12 per cent were unsure.

Other political parties were asked whether they support the current Three Waters (Affordable Water) proposal. Their responses are:

  • Act: No.
  • Green: We are pleased that the Government has increased the number of water entities to ensure a closer connection with communities they serve. But we still have significant concerns that the current proposals don’t do enough to guarantee public ownership and protect nature. The failure to separate stormwater management is another missed opportunity.
  • Labour: Yes. The cost of fixing our broken water infrastructure is estimated at $185b over the next 30 years. Local councils cannot afford this on their own, and households in some areas could see rates rise up to $9,730 per year by 2054 if we do nothing.
  • Te Pati Maori: No, because Maori ownership rights and entitlements have yet to be determined.
  • National: No. Labour’s policy is just Three Waters under a new name, with the same asset confiscation, broken governance and bureaucratic centralisation. We will repeal Labour’s three waters and return assets to local hands.
  • New Zealand First: No. It is a racist Trojan Horse masquerading as a solution. And the fiscals behind it have already be thrown into serious question.

Resource Management reforms

Last month, the government passed its Resource Management Act replacement, ending 30 years of the RMA.

Two acts, the Natural and Built Environments Act and the Spatial Planning Act, make way for a new planning regime which aims to cut down the number of plans councils are required to produce.

Environment Minister David Parker praised the simplification offered by the new resource management system.

“At the moment, there are over 100 RMA plans, those are cut down to 16 better plans that will be structured in a similar way and therefore are easier to follow, are made faster and result in more permitted activities, lower land prices, lower consenting costs and better environmental outcomes,” Parker said.

He added it will “save homeowners, infrastructure providers, a lot of money — hundreds of millions of dollars have been here”.

When asked whether the legislation replacing the Resource Management Act will satisfactorily support economic development while also protecting and restoring the environment, only 7 per cent of respondents said “yes”. The majority — some 59 per cent — responded “no”, while 34 per cent are “unsure”.

The legislation is hotly contested. When political parties were asked by BusinessNZ whether they support the changes to the Resource Management Act, they responded:

  • Act: Act has released a policy to replace the RMA which puts property rights and local decision-making at the centre.
  • Green: We supported the Natural and Built Environments Bill and the Spatial Planning Bill to the Select Committee but will continue to push for improvements to ensure that nature and the climate are at the heart of the system.
  • Labour: Yes. The new resource management system will better protect the environment while cutting red tape, lowering costs and shortening the time it takes to approve new homes and key infrastructure projects. It is expected to cut costs to users by 19 per cent.
  • Te Pati Maori: Yes.
  • National: No. We will repeal Labour’s RMA replacement bills by Christmas 2023.
  • New Zealand First: No. New Zealand First does not support the expansion of Treaty references in the new legislation or the inclusion of spiritual beliefs in water management.

Climate change

Business chiefs were asked: Do you believe New Zealand needs to increase its investment in adaption to climate change?

Over half of all respondents — 51 per cent — believe New Zealand needs to increase investment in this area. Some 30 per cent responded “no”, while a further 19 per cent are “unsure”.

There was consensus from political parties on this front too. When asked the same question, all parties broadly agreed that more investment in adaption to climate change is required:

  • Act: Yes. Act believes climate change spending should be focused on adaptation rather than mitigation.
  • Green: We supported the Natural and Built Environments Bill and the Spatial Planning Bill, to the Select Committee but will continue to push for improvements to ensure that nature and the climate are at the heart of the system.
  • Labour: Budget 2023 allocated $6b in initial funding for a National Resilience Plan for infrastructure. The Government also released New Zealand’s first Emissions Reduction Plan in May last year.
  • Te Pati Maori: Yes.
  • National: New Zealand will need to invest more in future-proofed infrastructure to ensure we can meet the adaptation challenge. National will work in good faith to make sure that cost is appropriately distributed.
  • New Zealand First: Yes. New Zealand First was already doing this with the allocations from the Provincial Growth Fund to adaptation initiatives.

Digging into this a little deeper, business leaders were also asked how climate change is impacting their business. The top three responses to this question were its impact on the cost of inputs to business (59 per cent), the cost of insurance (53 per cent) and the cost of products or services (48 per cent).

Infrastructure

BusinessNZ respondents were asked to rank various types of New Zealand’s infrastructure in terms of which has the most potential to contribute to New Zealand’s business growth.

Transport infrastructure (roads, rail and ports) was the clear frontrunner, receiving a score of 4.4/5. This outpaced other options, with energy infrastructure (electricity and gas) receiving a score of 3.9/5, telecommunications scoring 3.8/5 and water scoring 3.3/5.

Just over half of respondents — 51 per cent — agree with an increase in user charges to help fund infrastructure build. Some 30 per cent disagree.

The survey results underscore the escalating apprehension among businesses regarding future energy costs, with 75 per cent of respondents acknowledging this as a concern. Just 21 per cent say the cost of energy isn’t of concern to them.

BusinessNZ asked respondents whether the Government has effectively managed the allocation of infrastructure spending.

Only 4 per cent of respondents believe that the current balance of investment, including the allocation between significant projects and smaller initiatives and the distribution across regions, is appropriate.

In contrast, a substantial 74 per cent expressed strong reservations, indicating that they perceive the Government’s approach to infrastructure spending as falling short of the mark. A further 22 per cent responded that they are uncertain.

Political parties were asked whether they support supplying major infrastructure services through public-private partnerships:

  • Act: Yes.
  • Green: Major infrastructure services that deliver essential public services such as energy and water should exist for the public good, not for profit. The Green Party prioritises Maori, community and public ownership over private profit.
  • Labour: We are open to alternative funding and financing tools, such as public-private partnerships and congestion charging however our current policy precludes PPPs in health, education, and corrections.
  • Te Pati Maori: Yes.
  • National: Yes.
  • New Zealand First: New Zealand First has been reluctant to support public-private partnerships in the past, where KPIs have not been met, but would not rule them out if there was accountable public oversight before and after establishment.

Skills and human capital

Education is heating up to be a major issue during the campaign, with data showing achievement for students is declining. Of the roughly 64,000 students who left school in 2022, only half attained NCEA 3 or above. A quarter left without NCEA 2, considered the minimum level needed to pursue work or further study, while 15 per cent failed to reach NCEA 1.

BusinessNZ respondents were asked whether compulsoryeducation is setting up young people with the skills they need to succeed in the future. Only 21 per cent of those surveyed responded “yes”. A significant 68 per cent said “no”, while a further 12 per cent were “unsure”.

In a follow-up question, business leaders were asked what skills and human capital issues the Government should be focusing on.

The top three responses were: attracting and retaining skilled migrants (40 per cent), increasing the literacy, numeracy and basic skills of the workforce (40 per cent) and taking a more company and industry-oriented approach towards developing solutions to skill gaps and labour market constraints (31 per cent).

Fair pay, employment relations

Legislation governing Fair Pay Agreements was enacted last year, establishing legally binding agreements that outline the minimum employment terms applicable to all employees within a given industry or occupation. These encompass various aspects, including standard working hours, minimum wage, training, and leave entitlements. Anticipation surrounding the impact of these agreements on various businesses and sectors is a topic of significant concern for business leaders.

When asked about the impact of the agreements, just 9 per cent of respondents foresee a positive effect on their businesses or sectors. In contrast, 39 per cent anticipate adverse consequences as a result of these agreements. A further 23 per cent remain uncertain about potential implications, and 29 per cent believe fair pay agreements will have no discernible effect on their businesses or sectors.

Political parties were asked if they support fair pay agreements:

  • Act: No. They allow a tiny percentage of employees to make decisions affecting 100 per cent in the sector and will make doing business significantly more difficult, regulated and expensive, especially for SMEs.
  • Green: Yes. Fair Pay Agreements will ensure that more New Zealanders are paid fairly for the work they do. They will also make an important contribution to closing the ethnic and gender pay gaps.
  • Labour: Yes. They will improve employment conditions by enabling employers and employees to bargain collectively for industry or occupation-wide minimum employment terms.
  • Te Pati Maori: We support Fair Pay Agreements, because we believe in a fair and decent workplace, and a fair and decent society.
  • National: No. National has committed to repealing the legislation within our first 100 days.

Fair Pay Agreements are not about fair pay. They’re about imposing mandatory union deals that force a one-size-fits all approach on Kiwi workplaces.

Candidate for MP: Margo Onishchenko wants to preserve our liberal democracy (Onehunga FM)

Margo Onishchenko tells Tim McCready about migrating from Russia as a young woman, and her journey to standing as the ACT Party candiate for Maungakiekie.

Once Margo turned 18 she followed her older sister to New Zealand. She trained at Unitec and now works as a civil engineer.

The contrast between Margo’s country of birth and her country of choice has been a significant factor in her decision to enter politics.

 

Candidate for MP: Dr Sapna Samant believes in wrap-around support for wayward youth (Onehunga FM)

Dr Sapna Samant tells Tim McCready about her career in medicine and film-making and the Green Party’s plan to address the increased rates of crime as well as tackling the wealth gap.

After qualifying and practicing as a doctor in India, Sapna migrated to Aotearoa in 2001. She worked and volunteered in various capacities for years before making the call to re-train and re-qualify as a doctor under the New Zealand system.

It was Sapna’s passion for activism, particularly against the Hindu-fascist ideology, that has led her to stand for parliament.

 

Candidate for MP: Greg Fleming wants to see a safer Maungakiekie (Onehunga FM)

Greg Fleming tells Tim McCready about his career in the charitable sector and his vision for a safer Maungakiekie electorate with thriving schools and businesses.

After training as an accountant and dabbling in a few small business ventures, Greg moved into the not-for-profit space where his passion for the institutions of civil society blosomed.

He’s been CEO of Maxim Institute and Parenting Place as well as the instigator and trustee of a raft of other organisations.

 

Candidate for MP: Hon Priyanca Radhakrishnan sees our diversity as our strength (Onehunga FM)

Hon Priyanca Radhakrishnan tells Tim McCready about her track record in parliament, and what she loves about Onehunga and the wider Maungakiekie electorate.

Priyanca was elected to parliament on the Labour Party list in 2017 and won the Maungakiekie electorate seat in 2020.

Her role as an electorate MP has coincided with being named a cabinet minister, and she currently holds a number of portfolios including Community and Voluntary Sector, and Disability Issues.

 

 

Onehunga FM: Former MP Denise Lee and Councillor Josephine Bartley on the issues that matter for Maungakiekie (Onehunga FM)

Josephine Bartley is the current Councillor for Maungakiekie-Tāmaki, and Denise Lee was formerly the local MP for the Maungakiekie electorate.

Denise and Jo joined Tim McCready to discuss the role of an electorate MP, and the issues that will be important to consider as we vote for our local Maungakiekie Member of Parliament.

Tim will be interviewing the candidates next, so follow Too Much Talk, and share with your neighbour.