Canterbury Employers’ Chamber of Commerce (The Chamber) Chief Executive Leeann Watson says today’s Budget 2021 announcement has largely overlooked the role of business in the country’s economic recovery.
Finance Minister Grant Robertson outlined his fourth Budget today, which focused on the three pillars of child poverty, affordable housing and climate change.
Ms Watson says: “Rather than taking a balanced approach within this Budget on societal issues and the economic recovery and rebuild, it feels like the Government has taken an either/or approach. In order to focus on some of the significant issues we face in New Zealand, such as around child poverty, affordable housing and of course climate change, we need to have a strong economy, which is underpinned by our business community. So it is disappointing that the role of businesses have been largely overlooked in this Budget.
“The Government has said that it is committed to tackling the foundational challenges in our economy and society, but where is the recognition of the role of business in supporting this? We need businesses and jobs to secure the livelihoods and welfare of our community.”
Ms Watson says it was positive to see the final stage of investment for a new South Island Mechanical Maintenance Hub to be built at Waltham in Christchurch.
“This Hub will create around 300 jobs through its construction, which is significant for the city, and will be a great asset for the region moving forward. It was also positive to see funding for a $306 million redevelopment of Scott Base, which will support up to 700 jobs over the six-year timeframe for the work and enable us to leverage our Antarctic connection, and most importantly, ensure our presence in Antarctica is safeguarded.”
Included in the Budget was an investment over the next two year of $44 million in continuing the Digital Boost Programme, which involves business training courses for SMEs, as well as providing new digital business advisory services to help boost graduates adopt digital ways of working in their businesses.
Ms Watson says the business support doesn’t go far enough.
“The continuing funding for Digital Boost is a positive, however it is only one slice of business support. While it will help some businesses with digital enablement, small businesses will tell you that’s only one of a raft of challenges they face every day – on top of responding to the impact of COVID – and some of which have larger priority.
“One key issue is skills shortages and the inability for some businesses to access staff, especially in light of the recent immigration ‘reset’ and acknowledging that building our skills pipelines can take time. There is also the increasing costs of legislative changes such as the increase in sick leave allowance, which will have a significant impact of businesses across the board, and particularly small businesses.
“The reinstatement of the Training and Incentive Allowance for levels 4-7 of the NZ Qualifications Framework will help to grow local employment and that pipeline of skills needed to support our recovery efforts.”
Ms Watson says while support for specific regions in the South Island for the tourism sector is welcomed, another key area needing support is international trade.
“We would have liked to have seen specific support for importers and exporters, as they navigate international freight disruptions and respond to long term freight changes, and as the borders open to re-engage with offshore markets.”
With regards to climate change, the Budget included an allocation of $300 million to recapitalise the NZ Green Investment Finance Ltd (NZGIF), including $302 million as a contingency to implement a regime to incentivise the uptake of low-emissions vehicles; $19.7 million to support the Government’s policy response to the Climate Change Commission’s final advice to Government; and $132 million for the design, enactment, transition and initial implementation of the RMA’s replacement to mid-2024.
Ms Watson says she would like to see how this funding will specifically help to support businesses.
“As we dig deeper into the detail of this investment in climate change action, we hope to see how this will support businesses in the private sector through this transition – and particularly manufacturers, as they manage their response to these changes.
“From a Canterbury and South Island perspective, it is positive to see the primary sector receiving support through the Budget to tackle on farm emissions. This will help to ensure farmers and growers have the tools they need to improve on-farm performance and meet freshwater and greenhouse gas requirements by 2025.”