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Wellbeing Budget 2019 delivers, but not for business

The EMA was not expecting much for business from the Wellbeing Budget 2019, but it was still disappointed it did not tackle some of its members’ key concerns. Chief executive Brett O’Riley says the 8500-strong member organisation’s focus is primarily on employees and their workers. “Nobody would argue that people’s overall wellbeing is important, and there is no doubt that a happier, healthier community is a more productive one. We do welcome the investment in mental health as it is a cost to everyone in different ways, including business, and any improvement in this area would benefit everyone,” says Brett O’Riley. “However, greater recognition could have been made of wellbeing in the business sector as a healthy economy provides the funding to deal with the difficult and complex social issues the Government is tackling,” he says. From an EMA member point of view, the best news for business probably came ahead of today’s budget with the decision not to introduce a capital gains tax. Mr O’Riley says two positives were the $300m of expansion capital for start-ups will be able to access in order to grow, and $197m to tackle homelessness through Housing First, a social housing initiative that could further the construction sector. With a key part of the economy’s success linked to being competitive in the digital age, and the EMA welcomes today’s announcement of $6.8m over four years to future-proof New Zealand’s manufacturing industry, as well as the additional $157m for research and innovation linked to low emissions. This ties in to another of the major challenges for members is getting the people they need. While the EMA is pleased to be involved in the crucial Future of Work project, more focus is needed to achieve an employment framework that supports future growth. In addition, the immigration […]

Focused spending for business and the economy

The Wellbeing Budget contains spending that would be positive for business and the economy, says BusinessNZ. Chief Executive Kirk Hope said the focus on innovation, research and skills would help more businesses develop at higher levels and grow the economy. “The Budget recognizes that commercialization of new ideas is often constrained among mid-sized firms and makes a $300 million provision to support this. “Another $157 million to assist firms in developing high-value low-emissions products recognises the deep need for research to come up with business solutions to climate change. “New Zealand was the world-leader in initiating the Global Research Alliance on Agricultural Greenhouse Gases and it is pleasing to see this supported with an $8.5 million provision in the Budget, along with $25 million for the Agricultural Climate Change Research Platform.” Mr Hope said business wants to ensure that the current reform of vocational education will increase the the number of people in on-job and other vocational training. He said the allocation of $197 million was a positive sign in support of that goal, and the allocation of unused Fees Free funding towards this was appropriate. Investment in equipping young people with civics knowledge, financial literacy, and key workplace competencies was also important for business, Mr Hope said. “One area where business would have liked to see more investment is in infrastructure that supports growth. We would also appreciate a fuller explanation of the Government’s infrastructure strategy, and how it fits into its wider economic strategy. “The relatively robust figures seen in today’s Budget are dependent on the economy continuing to deliver growth so that tax rates can finance the Government’s ambitious expenditure programme. The trick will be to ensure the economy keeps growing sufficiently to ensure promised funding can be delivered to critical areas in a timely way. “If […]

Budget overlooks business wellbeing

Budget 2019 largely overlooks one of the key drivers of people’s wellbeing – their livelihoods, says Canterbury Employers’ Chamber of Commerce Chief Executive Leeann Watson. Budget 2019 utilised the Treasury’s Living Standards Framework to inform the Government’s investment priorities and funding decisions. “This is not a Budget that will transform our economy,” says Ms Watson. “While it will go down in history as the first wellbeing Budget, it does not go far enough in terms of supporting businesses to enable growth. “We are generally supportive of the concept and impetus behind the wellbeing framework, but it doesn’t work if we don’t have the financial wherewithal to fund those wellbeing initiatives. The key aspect that has been overlooked is an explanation of how the wellbeing Budget approach might assist business growth and reduce the burden on business.” Ms Watson says that while this was not a ‘business Budget’, there were aspects of the Budget that would be welcomed by the business community. “It was positive to hear the Government’s $300 million fund for investing in venture capital markets, with a particular focus on mid-sized businesses, as well as the $157 million allocated to help support start-ups focused on innovation to promote low-emissions. We also welcome the investment in infrastructure through the $1 billion earmarked for rail over two years. “At a local level we are very pleased to see the increase in funding for the Christchurch Schools Rebuild Programme, which will make a significant difference to our community. We also look forward to hearing how the confirmed funding for the Reform of Vocational Education will be parcelled out.”

EITE business committed to low-emissions economy

A new report shows firms with high energy use working responsibly towards climate goals. A report by Castalia Strategic Advisors shows that EITE (Emission Intensive and Trade Exposed) businesses are proactively reducing emissions and have a common interest in helping the Government to meet its international climate change obligations. (Emissions-intensive firms use significant amounts of energy to create their products. Trade-exposed firms sell products overseas in competition with overseas firms. Firms that are both emissions-intensive and trade-exposed bear the cost of reducing emissions while competing against overseas firms that do not bear similar costs.) The report shows that New Zealand’s EITE businesses are a significant segment of the economy, employing around 15,000 New Zealanders. The businesses, members of a BusinessNZ EITE working group, want to help the Government achieve workable emissions reduction policies and an energy-intensive sector that is responsive to climate change policies. BusinessNZ Chief Executive Kirk Hope says EITE businesses want to see emissions reduction policies that take account of unintended consequences and potential risks to the economy. “For example, there is a risk of uncompetitive emissions pricing forcing domestic businesses to close, with production shifting to countries with higher emissions intensity. “The EITE group is seeking ongoing and constructive dialogue with the Government to help ensure that unnecessary trade-offs are avoided, and investment can be encouraged. “EITE businesses produce goods that form the backbone of our economy including fresh food, building materials, critical industrial chemicals, and industrial metals. “EITE businesses create jobs, wealth and regional diversification, and contribute significantly to higher living standards for all New Zealanders. “Any emissions reduction policy must consider the economic and social impacts it will have on this important sector. “Predictable and durable policy settings are the cornerstone to unlocking greater investment in low-emission initiatives, and we welcome any opportunity to work […]

What is a Wellbeing Budget?

It is commendable for Government to tackle things in different ways, to take an in depth look at how are all doing and try to make our lives better -Doug Green, Publisher, NZ Manufacturer There are plenty of areas to focus on – one might say the usual suspects – health, education, housing, domestic violence and the shocking role alcohol plays in this…just saying, skills training – to lead to fairness and equality. However, the strength in the Wellbeing Budget will also be seen in the focus Government gives to economic matters – in an economy that is starting to slow down. Circling all this good will and intent is Productivity. Grant Robertson knows this. If Productivity cannot be lifted, then there cannot be wage growth. If we don’t experience wage growth, then people do not get ahead. Have you ever heard of a power company or cable provider reducing their charges because the consumer isn’t keeping up with the cost of living? Dieter Adam, Executive Director of The Manufacturers’ Network tackles some of this in his article on Page 10 “Relearning what it means to be globally competitive” when he says “we could sell more if we could make more, and we could make more if we had the right people for it”. And of course, the right people are the well-paid people who can afford a home, good healthcare and education for their children with the incentives in place for them to do a good day’s work. I am impressed with EMA Chief Executive Brett O’Riley’s personal viewpoint on Page 29 about the Overseas Investment Office’s decision to block Waihi mining company OceanaGold’s application to purchase nearby farmland to expand its operation. He sees this decision as a disincentive to business investment for the good of the […]

Facilities Integrate 2019

Now in the hands of renowned B2B event manager – Lorraine Smith, Facilities Integrate 2019 is set to deliver a unique experience for attendees and exhibitors. Lorraine, is promising a ‘more engaging show experience, with a distinct focus on learning, special features, interactive displays and showcasing the latest technology. “Features engage the audience and provide learning and motivation. And more than ever, we live in an interactive world, so being able to touch, see and feel rather than merely look provides a far more valuable experience,” says Smith. Taking place on 25 and 26 September this year, Facilities Integrate is the trade-only event for people who make facilities and buildings smarter, safer, and more efficient. The two-day expo provides unparalleled opportunities to try and source the latest equipment, meet the best suppliers, network with potential business partners, and stay on top of what’s going on in the industry. Smith says vendors recognise the value of reaching a select audience of professionals engaged in the facilities management and system integration industries, amongst others. “This is the show for architects, building operators, electrical engineers, electrical service contractors, facility managers, installers, integrators, property developers, system designers, and more. We uniquely combine elements of building technology and design, providing a view of the latest developments and even a glimpse into the future,” she says. Explaining the focus on ‘experiential’ displays, Smith points to the outdoor ‘Drone Zone’ which is introduced for the first time. “We’ll have seminars and equipment on display showing what’s available and how this technology can be used by facilities managers. What we’ll also offer is the opportunity to see drones in action – and delegates can even fly a drone themselves, providing a true hands-on experience.” “Within an integrated facility, security is an increasingly contentious and fascinating topic. There’s the […]

Incredible result was the right one

Australia has voted in a resounding way to maintain the status quo, rejecting the Labor Party’s push to create a government with a trade union heart. From Moggs Creek to Burnie, Port Hedland to Coffs Harbour the country chose a steady, progressive LNP as against Labor, which was riding on the legend of the Silver Bodgie, hoping this would get them over the line first. Throughout the campaign Scott Morrison produced a herculian effort – mainly alone – to drive the LNP message to Australians. He was focussed and considered and wasn’t easily riled. Bill Shorten on the other hand often came across as a trade union official, keen to sign up members. Bill Shorten has resigned as leader and it is hard to see who will replace him and be a charismatic force to bring about change in public opinion. When you consider the key issues that worried Australians – health care, housing, the Adani mine, climate change, care of the over 60’s, education and employment, none of this could be placed at the feet of the LNP as Labour tried so hard to do. Because these are worldwide issues, issues that all countries are constantly battling with. They were not issues that LNP or Scott Morrison were responsible for alone. The Adani Mine and climate change are huge challenges for the Morrison government. Mining provides lots of employment opportunities for Australians. We live in times where full employment is the ideal. Australia’s climbed to 5% unemployment just before the election. More so if not for mining. Sometimes the ideal is not the reality. And a final thought: the proud history of the Australian Liberal and National Parties with their support and backing were never going to tolerate a trade union reign of power. Some of them may be the […]

R & D expenditure to be raised

The Government has committed to raising New Zealand’s research and development (R&D) expenditure to 2% of GDP by 2027. To reach this target more businesses will need to increase their expenditure on R&D. This will be supported through an R&D tax incentive, available from the 2019/2020 tax year for businesses conducting eligible R&D. The main features of the R&D tax incentive include: a credit rate of 15% a $120 million cap on eligible expenditure a minimum R&D expenditure threshold of $50,000 per year a limited form of refunds for the first year of the scheme that will mirror the R&D tax-loss cash-out scheme run by Inland Revenue. A more comprehensive policy will be in place for the second year of the scheme a definition of R&D that ensures the credit can be accessed more easily across all sectors, including the technology sector the inclusion of state-owned enterprises, industry research cooperatives, levy bodies, and minority-owned subsidiaries of select Crown entities. The Taxation (Research and Development Tax Credits) Bill was passed into law on 7 May. The R&D tax incentive will apply to eligible R&D activities conducted by a business during the 2019/2020 tax year. For most businesses this means expenditure on eligible R&D undertaken from 1 April 2019 will qualify for the R&D tax incentive, and they should record their R&D expenditure now to ensure their records are ready to file at the end of the tax year. Businesses can look into whether they might be eligible for the tax incentive by referring to draft guidance issued by Inland Revenue. This guidance will be finalised in the weeks following the Bill’s third reading. For year one of the R&D tax incentive there is limited refundability available for smaller businesses with cashflow challenges. There is work underway on a more developed refundability process to […]

Obsession drives latest purchase for Shot Darts

A new piece of machinery has firmly positioned Katikati’s Shot Darts as a leader in the international darts industry. The recently purchased titanium plating plant is behind the vibrant colour coatings on the company’s darts. It also ensures a durable coating that doesn’t chip and helps keep a dart’s edges and grip intact, supporting the quality and flair the company is well-known for in international darts circles. Managing Director Peter McCormick says the purchase speaks to the company’s obsession with darts, which goes back almost 50 years to when his father, John McCormick, took over the business. “To the best of my knowledge, we’re the only precision darts manufacturer in the world to manage the entire manufacturing process in-house. From initial concepts, to packing our beautifully finished tungsten darts by hand ready for shipment, we get it all done here at our factory in New Zealand. “It gives us complete control, from woah to go. Not just over quality, but also lead times and consistency of supply. Mr McCormick says customer expectations for lead times are getting shorter and shorter, and he expects bringing the entire process in-house to shorten turnaround by at least two weeks. “It enables us to be more flexible, to respond quicker to customer needs.” The company has backed up its investment by hiring a machine operator with a Master’s Degree in Chemistry, a role Mr McCormick says is expected to have a strong research and development focus. “We want to see what the machine is really capable of. We’re excited about continuing to push the envelope. And getting our ideas out there, into the hands of players, faster.” However, the process of getting the machine to Shot Darts Katikati factory and up and running hasn’t been without its difficulties, he says. “There have been challenges, […]

T-Tech grows as tech solutions come to the fore in transport

Attracting a record 173 people, Intelligent Transport Systems New Zealand’s annual conference has grown rapidly in recent years and increasingly seeks to solve the transport challenges faced by planners and government decision makers. Rebranded as T-Tech, the annual conference now encompasses solutions beyond the traditional ITS traffic management hardware and software. With over forty speakers at this year’s T-Tech, the conference included “Future Transport solutions, such as electric connected autonomous vehicles, and “Mobility as a Service”, business models enabled by technology such as ride hailing (Uber) and carsharing fleets like Yoogo, Mevo and Cityhop. International keynote speakers represented two strong new modes of transport which may significantly change the urban landscape. Mr. Horace Dediu, a Romanian-American technology analyst, is considered the world-leading authority on “micro mobility”. Micro mobility is a term coined by Mr. Dediu in 2017 describing a category of vehicles under 500kg that includes e-bikes, electric scooters and bike sharing schemes. Dediu believes we have not yet begun to understand the wave of new solutions that will emerge in this category, he likens the current electric scooters to be similar to early version mobile phones in terms of the development ahead; a comparison he can talk with some authority to as a widely respected analyst of Apple and iPhones. Mr. Dediu began researching transport disruption at the Clayton Christensen Institute which examines disruptive technologies. He said that autonomous cars as imagined by car manufacturers could not actually be classified as disruptive. He has since become an advocate for the low-end of the transport, where small, efficient lightweight vehicles can replace the vastly more inefficient car in short trips. Dediu organises large conferences in California and Europe and hosts the popular Micromobility podcast with New Zealander Oliver Bruce (formerly at Uber) using data from Uber, Lyft and […]

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