Saturday, April 27, 2024

Labour hints at tax sweeteners to drive diversification

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David Shearer has raised the prospect of tax incentives to encourage Kiwi companies to keep and grow their businesses at home under a Labour government he would lead that plans to diversify the economy.
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He stopped short of placing dairy expansion on notice, but said Labour would want to be sure more dairy farms did not compromise the environment, and he warned of the risks of placing too much emphasis on one industry.

“It’s an important industry to our economy but not for creating jobs,” Mr Shearer said. “To create jobs we need to diversify our economy.”

Leaders of the two cosiest Opposition parties, the Greens and Labour, made two major positioning speeches on Sunday as they rallied their troops for a new political year.

Labour talked up preparations and priorities for governing in 2014 and the need to diversify the economy but the Green Party focused on a more immediate agenda to stop National rolling out any more “hard-line” policy, such as asset sales.

Greens co-leader Metiria Turei delivered her party’s annual state of the planet speech in Auckland with a new campaign to reach out to a wider constituency unhappy with National policies.

In Wainuiomata, Mr Shearer fired up party faithful championing hands-on government and pillorying National for making excuses.

After his speech, where he'd said the country could not create more, better paid jobs by simply exporting more milk powder, Mr Shearer said New Zealand ran real risks from having too much emphasis on one product.

He had asked the party’s economic development team to work on the detail of where the country might diversify, but he suggested more innovation at the hi-tech end in other natural resources such as fisheries and forestry.

Diversification was something New Zealand had to do, he said, and suggested it take inspiration from countries like Finland and Israel.

This might mean the Government having to provide encouragement such as tax incentives.

“The Government may actually have to roll up its sleeves and get involved in encouraging our companies to grow,” he told reporters.

“We’ve seen a lot of innovative companies right now starting up and getting to a particular size and then selling off overseas. I want to see those companies growing bigger in New Zealand and providing better opportunities for us.”

Mr Shearer said he would make it a priority to get the party’s new KiwiBuild mass home construction policy underway immediately, if Labour takes office in 2014.

He repeated that the party believed it could build the 100,000 affordable homes for $300,000 each – on average nationally – though he said it could be more in some places like Auckland.

Though National had dismissed the costings as dishonest, big construction firms had told Labour they could drop prices dramatically if they had large-scale orders providing economy of scale.

And Labour would publish research this week commissioned from Infometrics backing up its assessment that KiwiBuild would create more than 4000 jobs, Mr Shearer said.

In Auckland where she launched the Greens’ “I’m in – for the future campaign”, Ms Turei outlined how the Greens aim to stop “negative” National policies being put in place before the 2014 election, by harnessing the power of like-minded voters not otherwise active in politics.

Two-thirds of the more than 3000 people who volunteered for the Green Party to collect signatures to force a referendum on asset sales had not been party members, she pointed out.

“This is about building a ground campaign of individual New Zealanders who represent the future that will be a real challenge to the old wealth and vested interests of the National Party,” she said.

“National may have deep pockets, but we aim to fight that with people active on the ground.”

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