Fran O'Sullivan: PM's agenda leaves room for improvement

Prime Minister John Key is congratulated by Finance Minister Bill English after delivering his statement in Parliament today. Photo / Getty Images

Fran O’Sullivan rates how John Key delivered on the 'five takeouts' business expected from his Parliamentary statement.

In my last online column I put forward five criteria by which business would just Key's economic agenda.

Here's how I rate his performance.

Spend that political capital (6/10)
Key is spending considerable capital by deciding to raise GST to 15 per cent to fund another round of personal tax cuts. Inevitably this roused the ire of Labour's Phil Goff who conveniently forgets the virtuous personal tax trade-offs the fourth Labour Government made when it introduced GST at 10 per cent in 1986 then raised again to 12. 5 per cent in 1989. He's also taking on property investors (contrary to the claims of other commentators).

Grow the top-line 5/10
Business will like plans to move ahead on mining the conservation estate, invest more in science and innovation and investigate making New Zealand a hub for financial services.

Set measurable goals to catch-up with Australia 2/10
Key seems rather shy on this score. But Act's Rodney Hide won't let up. There's no danger Key's programme will supplant his crusade for NZ to "catch up with Australia."

Room for improvement.

Reform taxation and crackdown on property speculation (7/10)
The KISS formula (keep it simple stupid) had got the business lobbies' tick. It is clear the Government will cut the top personal income tax rate, put GST up to 15 per cent, wipe depreciation on buildings and in all reduce company taxes.

Jobs Summit – Redux (6/10)
Key hasn't announced another Jobs Summit to focus on burgeoning youth unemployment. But it clear the Government's intention to get some focus on trades training will help young Kiwis. Other measures will have to wait till the Budget.