Fran O'Sullivan: Our chance to make Aussies listen

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Joint Cabinet meeting in Sydney opportunity to push for better treatment of Kiwis living across the Tasman.

Tony Abbott, left, will welcome John Key and his ministers to Sydney this week. Photo / Getty Images
Tony Abbott, left, will welcome John Key and his ministers to Sydney this week. Photo / Getty Images

The strong personal chemistry between John Key and Tony Abbott will be enhanced if a transtasman sweetener emerges from what Australian sources bill as a possible "four eyes" meeting to discuss thorny issues such as a "fair deal" for Kiwis across the Tasman.

The Key and Abbott bilateral takes place in Sydney on Friday during a full-on day of business briefings, a "joint Cabinet" meeting, a sold-out lunch which the two Prime Ministers will address and a reception at Kirribilli House, Abbott's official residence in Sydney.

The so-called "four eyes" meeting (Key and Abbott and maybe an adviser each) is expected to discuss possible measures to rectify the mounting perception the Australian Government is too harsh in denying social funding to New Zealanders working and living in Australia.

Australian sources suggest that opening the doors to Government funding for New Zealand students resident in Australia to go on to tertiary education was among the measures up for discussion in a preparatory package for Friday's "joint Australasian Cabinet meeting" which arrived on Abbott's desk in Canberra this week.

The sources suggest there is merit in opening the doors to "Kiwi kids" to receive Australian Government funding for higher education. The rationale goes something like this: getting professional qualifications will enable the children of New Zealanders based in Australia to be better contributors to the Australian economy and less likely to end up deadbeats. And, as they were unlikely to return to New Zealand, the funding would not be wasted.

Key has been careful not to raise expectations here.

If Abbott does move to rectify this clearly unfair situation, it could usefully be spun domestically as an investment in Australia's future - not a benefit.

But the Abbott Government is most unlikely to accede to pressure from our politicians to allow New Zealanders who arrived in Australia after 2001 to access the full range of social security payments such as the unemployment benefit, parenting benefit, special benefit and sickness allowance.

This issue - like the perennial call for mutual recognition of franking or imputation credits - is seen as a step too far at a time when the Australian Government faces fiscal constraints and is not expected to post a Budget surplus for six years.

BNZ chief executive Andrew Thorburn says that factor won't stop the transtasman business clamour. Thorburn should know. He co-chairs the Australia New Zealand Leadership Forum and is one of the 50 members of a business delegation accompanying Key to Sydney on an air force 757 tomorrow.

Leading Australian business people such as Rod McGeoch have also emerged as strong champions of mutual recognition. It's also had the tick from a joint Productivity Commission study on the integration of the two economies. Getting it on to the official transtasman work agenda would be a step in the right direction and should not be too difficult for the two Prime Ministers to orchestrate.

This year is Australia's turn to host the G20. It's a big deal for Australia and also this country.

Abbott set out his own expectations when he telephoned Key in October to invite New Zealand to join the November meeting in Brisbane. A small country such as New Zealand will have to bring something extra to the table to earn attention from the G20's giants including the US, China, Germany and Russia.

Abbott has asked Key to ensure New Zealand concentrates its efforts on trade and relationships with the Pacific. New Zealand is also roped into the B20 (business initiative).

But as Key confirmed this week, the timing of the G20 - and the possible official visits to New Zealand by international leaders he has invited here such as Barack Obama and Angela Merkel - also impinges on the timing of the general election.

Ministry of Foreign Affairs and Trade chief executive John Allen is chairing the New Zealand officials G20 group with deputy secretary David Walker, New Zealand's G20 "sherpa" who also leads the TPP negotiations, with the Treasury's David Ng also playing a leadership role. BusinessNZ's Phil O'Reilly is leading the B20 effort.

Abbott will brief New Zealand ministers in more detail on the G20 agenda. Key is taking with him Bill English, Steven Joyce, Tony Ryall, Amy Adams and Michael Woodhouse. Australian Treasurer Joe Hockey and Trade Minister Andrew Robb will be among the Australian ministers present.

What distinguishes this third joint Cabinet meeting during Key's prime ministership is the role that New Zealand business will play.

When Abbott called Key in October he also asked him to bring a delegation of business people with him to Sydney.

What distinguishes this third joint Cabinet meeting during Key's prime ministership is the role that New Zealand business will play.
What distinguishes this third joint Cabinet meeting during Key's prime ministership is the role that New Zealand business will play.

The delegation is wider than it might have been in the past. The banking and agribusiness leaders are all there (Westpac's Peter Clare and Simon Power, BNZ's Thorburn and ANZ's David Hisco with Fonterra's Malcolm Bailey) but also digital economy leaders such as Xero's Rod Drury. It is meant to demonstrate the breadth of our economy.

The delegation is also a frank response to Abbott's election night statement that Australia is "open for business". It is an endeavour to reposition New Zealand's importance to the Australian market. There is new Administration in power in Canberra and neither the Key Government nor officials can take the relationship for granted.

But learning to play as a "single market" is not just a challenge for the politicians.

The decision by some Australian supermarket chains to block New Zealand suppliers in favour of an "Australian made" focus by solely contracting domestic suppliers rankles with our producers.

English acknowledges that, while it is not illegal, it is an area where business may have to step up.

That said, his own focus is on the two big inquiries that Australia has underway - the financial services inquiry headed by former Westpac boss and Treasury official David Murray and the National Competition Inquiry, a root-and-branch look at the country's competition framework.

As our banks are predominantly Australian owned the Murray inquiry has huge relevance here. So, too, the competition framework, because transtasman competition issues often emerge, particularly in the aviation industry.

English is up with the G20 issues such as the OECD taxation work on base erosion profit shifting to tackle digital giants such as Google and Apple. Just back from the World Economic Forum in Davos he is keen to see a greater concentration on overseas investment by businesses here.

One question he does have for local business is this: why has it missed a once-in-a-generation opportunity to invest in Australia during the past decade?

That's a question the business delegation could usefully chew over.

Debate on this article is now closed.

- NZ Herald

Fran O'Sullivan

A columnist for the NZ Herald

Fran O'Sullivan has written a weekly column for the Business Herald since its inception in April 1997. In her early journalistic career she was a political journalist in Wellington and subsequently an investigative journalist who broke many major business stories including the first articles that led to the Winebox Inquiry in both NBR and the Sydney Morning Herald. She has specific expertise in relation to China where she has been a frequent visitor since the late 1990s. She is a former Editor of the National Business Review; has twice been awarded Qantas Journalist of the Year and is a multiple winner of the Westpac Financial Journalism Supreme Award.

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