Mood of the boardroom: A fine balance between economic and health outcomes

Nick Wells of Chapman Tripp. Photo / Supplied

Chapman Tripp, New Zealand's largest commercial law firm, moved into its new office taking up three of the higher levels in the Auckland Commercial Bay Precinct on a Monday. The staff didn't have time to organise their working spaces before they were sent home again for the second Auckland Covid lockdown.

The staff of 270 is now settling back into the office that has panoramic views of the Waitematā Harbour. "The assumption is we are office dwellers but over lockdown we showed we can work well from home and work flexibly," says Chapman Tripp chief executive partner, Nick Wells.

"We've made sure we have supported our people and clients, with the number of issues thrown up by the Covid-19 pandemic."

Wells is now looking to the next government for a firm economic direction to get through the upheaval. He says the Government must start the major shovel-ready infrastructure projects as quickly as possible to soak up the rising unemployment over the next six months.

"New Zealand has shown its ability to balance the economy with health and wellbeing, but we have an ongoing issue with jobs. I'd rather play cautious with the Covid border testing and contact tracing, and use that as a mechanism to open up the economy instead of being looser and living with Covid — and the mortality rate that comes with that, like in United States.

"The border restrictions and social distancing could be the new normal for an extended period of time, even another 12 months," he says. "There will be redundancies across education as well as tourism and hospitality. They will have mortgages and there could be an undesirable flow-on effect with the start of mortgagee sales."

Wells, a fan of the compulsory Australian superannuation scheme, doesn't like the idea of people who have lost their job to use $20,000 of their KiwiSaver funds to start a new business. "Starting a business can be quite risky, and I favour a grant scheme, as well as increasing the level of social welfare payments till we get clear of Covid."

Wells predicts unemployment will rise at least 5-10 per cent over the next six to 12 months (to between 9 and 14 per cent), and "we need to get the big projects up and running and re-employ these people as quickly as possible.

"We need to improve our infrastructure deficit and create a more sustainable economy. I'm not just talking roads but rail that can reduce carbon emissions. I don't think green tech private schools are the best initiative."

Wells says the infrastructure projects employ people across the board — not just labourers but also planners, engineers, financiers and other services. He says a problem is that the three-year election cycle has come in the middle of the pandemic and "this will cause a period of delay we don't want in starting projects.

"The election cycle can be costly and three years is too short — four years would be fine."

Wells says the next six months will be volatile but "I feel positive about our Levels system and Covid elimination strategy that strikes a balance between the needs of the economy and the desired health outcomes.

"A lot of countries have struggled to do this in the way we've done it and it has put New Zealand in good stead. It provides a platform to engage with the outside world and it makes us a desirable country to do business with."

Wells says NZ has the opportunity to export professional services and intellectual property, as well as safe food products.

"We can make use of our time zone by helping out overnight in the UK. In the legal profession we could shape an initial draft or provide a piece of advice. The UK is exiting the European Union and we have expertise to help in trade negotiations."

He says many returning Kiwis are quite happy to stay here and provide consulting services back to their employers in the UK.

"The fibre roll-out has helped us work well from home; we couldn't do that a few years ago. We can export our services and get good revenue for the country."

Nick Wells' top issues

Top three issues facing New Zealand:
1. Rigorous border controls run by government/police/military.
2. Keeping the domestic market trading, while border restrictions are in place, by making use of the levels system to manage Covid outbreaks in the community without locking everyone down.
3. Focused support mechanisms for people in need with preference for getting them back into employment rather than just making social welfare payments.

Top three business priorities:
1. Ensuring we maintain our ability to work remotely as and when needed.
2. Supporting our people and clients with the number of issues — such as childcare — thrown up as a result of the pandemic.
3. Meeting the niche demands of the new environment — such as exporting professional services and advising on company capital raisings — and moving resources into the areas that need it.