Mood of the Boardroom: Robertson's future looks bright

By Bill Bennett

Grant Robertson at last year's Mood of the Boardroom event. Photo / Jason Oxenham
Grant Robertson at last year's Mood of the Boardroom event. Photo / Jason Oxenham


Sixty-nine chief executives responded to an open-ended question as to what they would like to see on the Labour Shadow Finance Minister's policy agenda.

"Continue to constrain public expenditure to core and effective services," advised Unitec CRO Rick Ede. "Reset taxation and investment incentives to favour productive investment instead of property investment.

"Continue the investment approach to welfare services begun by Bill English."

Many, but not all, of the themes on Robertson's own priority list resonate with the boardroom. With 67 per cent per cent of CEOs predicting technological advances will be the single factor with the biggest impact on business in the next five years and a further 7 per cent singling out job losses through technology, it is clear Robertson's Future of Work initiative falls on fertile ground.

The Future of Work project has moved the party away from its historic focus on large-scale, traditional industries and unions towards engaging with small business and entrepreneurs.

The goal is to lift skill levels, move New Zealand towards a knowledge economy and a more adaptable workforce to cope with rapid technological change.

An energy industry chair says furthering the Future of Work discussion inside the Labour caucus is important; "even if it isn't strictly part of the finance portfolio."

Hawkins Group CEO Geoff Hunt says a priority should be "getting the right skills delivered by the education system" while KiwiRail's Peter Reidy wants Labour to develop policies "to attract trade and technical skills into the market place".

Lifting education levels and focusing on social issues including poverty is a common theme. But a property boss says the finance spokesperson should prioritise "economic prosperity for all New Zealanders".

EMA boss Kim Campbell says Robertson "should identify the weaknesses in fiscal policy which is leaving National open to criticism".

Opinions were mixed on Labour's redistributive philosophy. A transport industry boss says Labour should "adopt a more centrist set of economic policies that steer away from a basic redistribution of wealth to supporting all New Zealanders and business to get ahead".

The head of a legal firm says Robertson needs to "demonstrate he really does understand economics and what makes a vibrant economy". A media chief executive says Robertson should "stop promising what is fiscally unsound, free university education and so on". Elsewhere a power industry chair says Labour needs to "work with Treasury on the Living Standards framework without dialling in significantly increased government expenditure".

Not surprisingly, some 20 per cent of CEO respondents say Robertson should prioritise housing policies -- an area where the boardroom is frustrated by National's policy vacuum.

Kiwi Property CEO Chris Gudgeon wants Labour to "get active on tax policy" to deal with housing affordability.

A media boss recommended a proactive stance on unpopular but needed actions: capital gains on housing, increased aged of Super eligibility, and redistribution of wealth via a review of personal tax structure.

An investment banker advises Robertson to provide; "incentives on productive investment rather than investment for capital gain in part financed by high leverage at the tax payers' cost with no or little return to the taxpayer".

Another leading banker also wants measures to improve housing affordability. He'd like to see an increase per capita incomes by cutting the corporate tax rate, fixing the Resource Management Act and removing obstacles to foreign investment, except where large or sensitive parcels of land are involved.

Not all Robertson's own themes resonate.

He attracts a fair share of criticism from a power industry boss who suggests the finance spokesperson needs to provide the Labour Party with lessons on how business works in the "real world".

A banker suggests the Labour Party should replace Robertson with "someone who understands the portfolio, like David Parker".

Meanwhile, a forestry boss says he need not worry about priorities as the Labour Party isn't going to win the election.

Among other suggestions: focus on digitalisation of the Government sector (KPMG's Ross Buckley); target financial illiteracy.

The biggest issue?

Vector chief executive Simon Mackenzie spoke for many when he said technological advances will be considerable and touch all New Zealanders in positive and negative ways.

"We have to embrace these but also actively manage the potential wide ranging impacts of them to avoid inequality issues rising.

"In addition these impacts will challenge and potentially undermine many of the regulatory and financial systems in New Zealand."

Other survey respondents pointed to a period of profound societal change ahead through automation.

A major food firm boss said it was impossible to isolate a single factor. 'There are a number of critical factors that will impact business: the growth of protectionism, geopolitical instability, state of the global economy, changing customer perceptions and servicing models."

A CEO who picked demographic shifts pointed to increasing opportunities to supply middle-class Asia.

But there were also warnings. An energy boss put forward "wobbly capital markets" and tackling the issues of monetary policy as possibly having the greatest impact on business.

"Burst of the balloon -- a spectacular post-quantitative easing crash in value across all asset classes globally," suggested Refining NZ's Sjoerd Post.

Robertson's four priorities:

• Find ways for industry to add value and diversify the economy: lift productivity and add value to primary industry and invest more in R&D.

• Focus on regional development and lift wages outside the main centres. Auckland's infrastructure and housing is under pressure. Housing costs less in the regions but there are not enough good jobs.

• Future of Work project to address the challenge of technology-led change head on.

Share the rewards from prosperity: many people work hard and yet they don't earn enough to buy a house.

"When I attend a business dinner, the conversation often turns to inequality. Many business leaders are concerned about this. They realise it can mean both a loss of potential and it can become a drain on the economy. Even organisations like the OECD, which is hardly a left-wing body, recognises that inequality inhibits growth," says Robertson.

Single factor with greatest impact on business next five years:

• 67 per cent - Technological advances

• 10 per cent - Demographic shifts

• 8 per cent - Fallout from globalisation

• 7 per cent - Job losses through technology

• 5 per cent - Shifts in global power

• 3 per cent - Urbanisation

• 0 per cent - Resource scarcity

- NZ Herald

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