Kurt Bayer

Kurt Bayer is an APNZ reporter based in Christchurch.

Manufacturing report 'urgent call to action'

Photo / Thinkstock
Photo / Thinkstock

The "killing" of New Zealand's manufacturing industry can be stopped if the Government makes a series of sweeping policy changes, a new report into the sector has concluded.

The report, commissioned by Opposition parties, makes a "sensible set" of recommendations to Government.

The Parliamentary Inquiry into Manufacturing launched its report on the sector, Manufacturing: The New Consensus at HamiltonJet in Christchurch today.

Summits were held around New Zealand as Labour, Greens, New Zealand First, and Mana parties took a look at the state of the sector.

The report amounts to a blueprint for better jobs and higher wages, the parties say.

They say the recommendations will allow the sector to implement its full potential.

They include monetary policy reform aimed at a lower and more stable exchange rate; tax incentives to support investment in manufacturing; fixing broken markets that create excessive infrastructure costs, such as electricity; tax credits for research and development investment; and a government procurement programme that favours Kiwi-made, said Cam Moore, chairman of the independent inquiry.

"A vibrant manufacturing sector is crucial to the future prosperity of New Zealand," said Mr Moore.

"The economic policies we have now are killing the sector. Our manufactured exports are falling and 40,000 manufacturing jobs have been lost.

"It doesn't need to be this way. With the right policies, we can unleash manufacturing, creating well-paid jobs and increasing the value of our exports."

The launch event was hosted today by Keith Whiteley, managing director of Hamilton Jet, who said the sector has been keenly awaiting the findings of the report.

Labour Leader David Shearer said Prime Minister John Key is "in denial" on the problems facing manufacturing.

He said the high value of the Kiwi dollar, and its volatility, is hindering businesses' competitiveness with other countries.

The public are also aware of the Government's tendency to look overseas for procurement, he said.

"We need a hands-on government that's willing to put Kiwi manufacturers first," Mr Shearer said.

"A job in manufacturing creates between two and five jobs elsewhere in the economy.

"They tend to be high-value, highly paid jobs that will keep New Zealanders here rather than going to Australia.

"Business owners, workers, and political parties have today formed a new consensus on the future of Kiwi manufacturing.

"We need a thriving and high-tech manufacturing sector that makes and sells products the world wants. New Zealand can't prosper on the back of our primary sector alone.

"Countries around the world are making sure their exporters and manufacturers have an advantage. We aren't. John Key's message to Kiwi business is: you're on your own."

The report shows there is a clear alternative to the failed economic policies of the National Government, Green Party co-leader Dr Russel Norman said.

"This is a historic event. For the first time, we have half the parties in Parliament signing up to an alternative economic vision for New Zealand," said Dr Norman.

"New Zealand has endured quarter of a century of neoliberal economics that have led to high unemployment, low wages, and increasing international debt. They threw manufacturing on the trash heap.

"Today, we are presenting the alternative. The recommendations that the inquiry is putting forward is a set of sensible, proven policies that will allow our manufacturers to compete on a level playing field with foreign companies, reduce excessive costs that impede business, boost innovation, and ensure that manufacturers and workers have the support that they deserve from government both in good times and in bad.

"By unleashing smart, modern manufacturing, we can create real wealth, rather than trying to extract more and more from our over-taxed environment."

New Zealand First called for all political parties to set aside their differences and create a better future for the manufacturing sector, which Winston Peters said has been the 'Cinderella Sector' of the economy for too long.

"This report is an urgent call to action if our manufacturing sector is to survive and thrive," he said.

"This is a case of badly needed cooperation and no party need feel they are being dictated to by the others.

"We simply cannot survive as a nation unless we start putting new life into manufacturing."

FIRST Union, representing workers in textiles and wood processing, welcomed the emerging consensus around a new way forward for manufacturing.

"While the current government is prepared to sit back and watch the high and volatile New Zealand Dollar punish the export manufacturing sector, it is heartening to know Opposition parties are making a good attempt to come up with policy solutions for manufacturing,'' said general secretary Robert Reid.

But Economic Development Minister Steven Joyce dismissed today's announcement as "nothing more than a failed political stunt''.

"Labour, the Greens, New Zealand First and Mana are determined to manufacture a crisis in manufacturing,'' he said.

"The massive problem for them is that while individual firms face real challenges at different times, no crisis exists.''

Mr Joyce highlighted the latest BNZ-BusinessNZ performance of manufacturing index, released last Friday, which indicates the New Zealand manufacturing sector is expanding at its fastest rate since 2004, and at one of the highest rates across the world.

- APNZ

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