Government indifference, public hostility, even cancer - despite it all, the Business Roundtable's Roger Kerr can't help being an optimist, he tells Karyn Scherer.

Roger Kerr doesn't even wince when I ask whether it feels as though everyone is already writing his obituary.

"It doesn't bother me in the slightest," he chirps. "If I'm of sufficient interest then great. It's an opportunity to tell the story the way I see it."

After 25 years of banging the Business Roundtable drum, Kerr doesn't need to be asked twice if he'd like the opportunity to bang it a little more. And although he predictably rails against personality cults, who wouldn't enjoy the sort of attention he's been getting of late?

A recent Herald editorial described the gong he received in the latest Queen's Birthday honours as "perhaps the most deserved" on this year's list, and suggested he'd had a greater influence on New Zealand's economic direction over the past few decades "than anybody outside the state service, or possibly within it".


There have been compliments from less obvious quarters, too, including several Labour MPs, as well as others "who might have seen me as a tribal enemy or something". Such tributes, he beams, "mean more to me than the award itself".

Whether the 66-year-old might have got the same reaction had he not discovered eight months ago that he might not have much longer to live is a moot point. Regardless of whether you agree with the Roundtable's message, few dispute that Kerr has mostly been an unusually personable messenger.

Even now, he seems to have accepted with extraordinary equanimity the possibility that his time may well be up.

When he discovered his first melanoma three years ago, it wasn't a complete shock. His brother, renowned cardiac surgeon Alan Kerr, had had a similar brush with skin cancer six months previously - the legacy, it seems, of too many childhood summers spent making hay on the family farm.

Unlike his older brother, Roger discovered his melanoma far too late, and last October he found out it had spread. Although he has yet to feel any physical side effects, his doctors have told him the average life expectancy for his type of aggressive cancer is six to nine months.

"Probably those numbers will start shifting a bit because there's a lot of developments going on in melanoma science right now, particularly a couple of new drugs which are the first serious breakthroughs for a long time. But they're not king hits by any means."

He has scoured the world for the best possible treatment options, which has included trips to Australia and the United States. But he has concluded that the treatment he is receiving here is the best available, and is participating in a clinical trial of a new drug that is so far proving promising.

"I've moved from Plan A which didn't work as expected, to Plan B which I'm hoping will work, and so on down the line... If Plan B doesn't work, I'm thinking about what could be Plan C and Plan D, and it could be something offshore. But the one I'm on now is producing results which in some cases are long-lasting, so I'm just hoping that I'm in that category."

Naturally, his wife of just over a year, former Act president Catherine Isaac, is hoping so too. Kerr concedes his prognosis has been particularly difficult for her.

"I'm pretty philosophical about it. Whatever will be will be. But we got married at the beginning of last year, so it's pretty tough for her."

Helpfully, Isaac works in a room next to his in central Wellington, with her PR firm Awaroa Partners. But it would appear that neither of them is making retirement plans just yet.

Kerr struggles to think of anything else he'd rather be doing than rifling through the perilous piles of paper that smother almost every surface in his spacious office.

His brother, when he retired, decided to spend several months each year performing pediatric surgery in Palestine for an American charity.

"I think that's terrific. What could be a more satisfying thing to do?... But I think I get a bit better at my job each year. Someone might tell me at some stage: 'You're dreaming; you've gone senile'. But I've been saying to myself why would I want to give it up?"

Before working for the Roundtable, Kerr spent 10 years with Foreign Affairs, then 10 years with Treasury. Since then, he's considered jobs in Australia and elsewhere. But he has never been seriously tempted by any of them.

"I've never found one that's been more interesting than what I've kept on doing here... I've wanted to put the effort into New Zealand and try to do my little bit to make the country a better place. And while you're prepared to slog your guts out to do that, I always wondered whether I would feel the same in Australia or some other place."

Perhaps Kerr is feeling so at peace with the world because he hasn't received a death threat for many years now.

It was a bit different when the Roundtable began. At the time, those who opposed Sir Roger Douglas' sweeping economic reforms were enraged by Kerr's enthusiastic support for his agenda.

An early controversy was the liberalisation of shop trading hours, which so incensed the Shop Workers Union it invaded his office. But there were friendly visitors too, including a steady stream of admirers from foreign governments - even Australia - keen to learn more about "the New Zealand experiment".

"Well I tell you, those days are long since gone," Kerr laments. "I don't see those kind of visitors now."

Partly because of the public backlash, and partly because MMP has made radical reform harder to achieve, subsequent governments have taken a much more moderate path. But Kerr has never changed his tune.

In 1997 beer baron Sir Douglas Myers suggested the Roundtable was the "most hated group in New Zealand". In 2000, then-Prime Minister Helen Clark suggested Kerr be sacked when it was revealed the Roundtable helped fund the "lost generation" ad campaign.

"That just made me more determined to keep my job longer than she did," he chuckles.

In 2004 there was the ignominy of having his crush on former Act MP Deborah Coddington become the lead story in the very first edition of the Herald on Sunday. And much more recently, the Roundtable's critics have pointed to the global financial crisis as evidence that the Chicago school of economics, with which Kerr is usually aligned, has been wrong all along.

Needless to say, Kerr is having none of it. The underlying cause of the GFC was politicians trying to entice people into home ownership who simply couldn't afford it, he insists. He also blames Federal Reserve chairman Alan Greenspan for keeping interest rates too low for too long.

"When the history books are read about the GFC a whole big part of the story will be a made-by-government story. Sure, there were bankers who were doing stupid bloody things - there's no question about that. But that's business life. Banks are businesses and businesses frequently do stupid things."

In the case of New Zealand's finance company meltdown, Kerr blames the former Securities Commission for being asleep on the job. It should be noted that it, in turn, has blamed the Roundtable for successfully opposing stronger regulation.

Kerr has crossed swords before with what is now known as the Financial Markets Authority: most notably a decade ago when he and Catharine Franks, wife of former Act MP Stephen Franks, took a stand on insider trading by personally suing former Fletcher Challenge chairman Kerry Hoggard.

The case was settled out of court for $500,000 and the money was used to set up The Business Integrity Trust, to help people wanting to take legal action against business misconduct. Oddly, it has had very few requests for support, says Kerr, although it recently helped a couple whose financial adviser suggested they diversify their investments into a range of now-defunct finance companies.

"Your heart just bleeds for those investors and what prick gave that advice."

Although he insists he's a "glass-half-full-type", Kerr is convinced there is plenty more fallout to come from the GFC.

According to him, economic studies are starting to show that Keynesian-style spend-ups in countries such as the US have had very little positive effect, and have caused severe long-term problems like massive debt.

While he concedes the general policy framework in New Zealand is "a heck of a lot better than it was", he is also convinced that the economy is the most vulnerable it has been for at least a couple of decades.

"I do think the country is more at risk now than it has been since the 1984 [currency] crisis, because of two factors. One is the external vulnerability if we see another banking crisis in Europe. I'm pretty sure there's going to be a meltdown of some description there.

"What will that matter for credit markets in New Zealand? It could be different to Lehmans, but it might not be, so that really is a worry. And the longer term one is the productivity story and widening income gaps with other countries."

Asked if, in hindsight, he has ever been wrong about anything - like climate change, perhaps? - Kerr struggles to come up with anything.

"I suppose there always are, but they're not things I lie awake at night thinking about."

Doesn't it bother him that even after all these years, the Roundtable has failed to persuade enough people that its advice might be right?

"In a sense, I'd say I'll put up my hand as part of the failure if you like. But what is the relative strength of the players in the public debate? I would say that it's politicians that matter most of all, because they are society's communicators... After politicians, I would say the media are more important than organisations such as us."

Kerr says he came to the view early on that most Kiwi journalists "try to do their best". However, he is disappointed that academics don't use the mainstream media more to foster public debate.

"Most academics are supportive of the liberalised deregulated economy but we don't often hear that [in the New Zealand media]. Whereas in most other countries, there would be a bunch of highly respected academics who would be regularly writing articles or at least participating in public debate."

He admits to being persuaded by prominent American economist Tyler Cohen that blogging is the way of the future, and he notes that University of Canterbury economists Paul Walker and Eric Crampton have their own blogs.

But isn't the the problem with blogs that you are preaching to the converted?

Kerr agrees, and cites several newspaper columnists he doesn't always agree with, but reads anyway.

"I like to be told I'm wrong and I like to be told I'm wrong in a big way, not a small way, because then that makes you think. New Zealanders tend to be shrinking violets a bit. They don't like to put their head above the parapet."

Some people will be surprised to hear that Kerr counts Treasury as being in that category. He fondly recalls his own time in Treasury, when the late Sir Robert Muldoon was Prime Minister.

"With Muldoon it was two steps forward and one step back. However in no way did that debilitate or downgrade the quality of what was going on the place. I think Treasury was getting better and better in those years, whereas in the most recent difficult period it has fallen away and lost good people. It's just not cutting edge in the way it could be."

While he concedes Treasury staff are probably weary from years of being ignored by politicians, he doesn't believe that's an excuse. The problem with Treasury these days, he argues, is that it has become eager to please, hence decisions like the one it made recently to join the trend of measuring "national happiness".

"The Treasury," he sighs, "if it's doing its job properly, is never going to be loved."

For all his own frustration at being frequently ignored, Kerr insists the Roundtable still has some influence in Wellington. While John Key appeared to publicly dismiss Don Brash's 2025 Taskforce report, for example, some of its recommendations have in fact ended up on the Government's agenda, he maintains.

The Productivity Commission was also a Roundtable suggestion. And he regards the Regulatory Standards Bill, which is currently before the commerce select committee, as potentially one of the organisation's most important recent initiatives.

The bill had its origin in a 2001 report commissioned by the Roundtable, Federated Farmers and the Auckland and Wellington Chambers of Commerce. Picked up by Rodney Hide, its aim is to prevent sloppy regulation by allowing the courts to run a ruler over any dodgy rules.

The bill's opponents argue that this would be a constitutional outrage. And although submissions are due by August 18, even the National Party has not yet pledged its support beyond this stage.

Kerr insists the opposition is overblown, and that the threat of regulations bouncing between MPs and judges is no different than similar threats the Reserve Bank faces if it doesn't keep inflation under control (although, for the record, he does happen to think that it is currently far too high).

In fact, Kerr sees the Regulatory Responsibility Bill as being just as important as the Reserve Bank Act and the Fiscal Responsibility Act.

The latter law was once described by former Finance Minister Michael Cullen as "constitutional nonsense", he claims. "Now it's unthinkable that any government would try to touch it."

All of these recent achievements can, of course, be attributed to Act, but Kerr is reluctant to talk about the party with which the Roundtable has so much in common.

"I don't get into commenting on politics and parties. I try to stick to policies and general economic directions," he demurs.

Anyone who has read Nicky Hager's expose of Don Brash's stint as leader of the National Party, The Hollow Men, will find that hard to swallow. But all Kerr will say about Act is that those who would like to see more urgent economic reform "have to think about where Act fits in".

"It's waxed and waned in terms of support over recent years. Will the recent changes make a difference? I don't know - it's yet to be seen."

Incidentally, does Kerr have any theories as to who supplied the source material for Hager's book?

"It's a question I've asked a dozen times," he replies. "But I've never heard [an answer]. It's a complete mystery."

Unlike some of his closest friends - such as Sir Douglas Myers, with whom he recently travelled to the Galapagos Islands for a "wonderful" holiday; and Stephen Jennings, an investment banker who made his fortune in Russia - it is notable that Kerr has chosen to stay in New Zealand.

He is happy to acknowledge that it remains a peaceful and beautiful country, which counts for a lot in the world today. But he is still deeply concerned at the growing income gap between New Zealand and Australia, and the lack of local opportunities for talented people which draws so many young Kiwis overseas.

"I think there is a hell of a lot to worry about. This transtasman income gap is a serious issue. If we keep on going the way we are, the 35 per cent gap will become 40, or 45, or 50, in the space of 10 or 20 years. Just imagine the outflow of businesses and people at that point."

Two of his three children from an earlier marriage already live in the US. One is an executive at Microsoft, the other a Silicon Valley techie.

"It's not the OE these days - it's much different. The world is soon going to be screaming out for energetic, talented people. With ageing populations and globalisation - it's only going to get easier to go find jobs somewhere else."

Another high-profile figure who frets publicly about the same problem is physicist Sir Paul Callaghan. Callaghan is also battling an aggressive cancer, in his colon, and Kerr reveals the two men have bonded over their fates, even though Callaghan is widely regarded as a "leftie". Kerr insists they have more in common than it might appear.

"Paul has been going on about prosperity for New Zealand and I think that's terrific. I said to him a while back: 'If both of us are alive in 12 months' time, I'd be very happy to talk to you a bit more about the way you're telling the prosperity story because with a bit of tweaking I could help you to make it a better, more persuasive kind of story'."

If asked, he admits, Callaghan would probably say their economic beliefs were quite different. "But I think, with more conversations, he would find that we're not that far apart."

Ever the optimist, it seems - except when it comes to our economic future. Realistically, New Zealand faces three likely scenarios, says Kerr.

"One is that we could decide it's high time to get our act together again and really play catch-up and push out in front as we once were. You can put your own probability on that.

"Another scenario is an economic crisis in the not-too-distant future. We are not robust, and we could easily be thrown into crisis again.

"The third scenario, which would be the more typical one, is that we muddle through. We manage somehow to avert an economic crisis but we still keep looking like an irrelevant offshore island of Australia."

So there you go - we have all been warned. Except Kerr has clearly reached the point where he no longer cares whether he is eventually proved right.

He is, he enthuses, "in a very happy state in my life at the moment".

"I've had a great life and I hope it doesn't get foreshortened, but it might. I won't be looking back feeling grim or anything about that. We all have to come to an end at some point, and this is mine."

* * *

A quarter of a century after it was founded, the Business Roundtable continues to attract CEOs from some of New Zealand's largest companies, such as Fletcher Building and Progressive Enterprises.

But over the years there have been some notable absences from its membership list. Some executives have been wary of being associated with what is perceived as its political agenda, while others have been keen to distance themselves from what is increasingly seen as "the old guard".

Following the second Knowledge Wave conference in 2003, a rival think tank was formed. The New Zealand Institute also has some heavyweight backers, including Fonterra, Foodstuffs, The Warehouse and Air New Zealand, and for a while it appeared to have the ear of the then-Labour Government. But Kerr maintains it was also ultimately snubbed.

"They fell flat on their face. They were rejected too," he suggests. "It was thought of during that period as the Labour Party's think tank, and now I'm not quite sure how to think about things. It's not really visible in Wellington."

At one stage some CEOs were keen to explore the idea of the two organisations joining forces, but that seems unlikely in the near future.

Just this week, Act leader Don Brash slammed the New Zealand Institute's first report on social issues, which suggests two initiatives to "reduce youth disadvantage": accelerating the roll-out of e-learning to low decile schools, and improving the school-to-work transition.

Far better, argued Brash, to reinstate the youth wage, lower taxes and reduce regulation.

Kerr admits the Roundtable has previously considered splitting into two: one arm as a think tank, the other a business lobby group.

"Once or twice that's come up, but I'd say the merits of our model is it combines the best of both of those concepts. On the one hand there's the backing of heavy-duty people in the business community and I think that matters and amplifies its influence. On the other, the think tank side of things keeps us consistent in the sort of things we advocate."

But is the Roundtable nearly as conspicuous as it once was? Its current chairman, Bell Gully chairman Roger Partridge, is a lawyer rather than a businessman, with a low public profile. And even Kerr does not seem as visible these days.

Kerr's explanation is that the organisation's newer members seem less willing to put their mouths where their money is.

"The Roundtable used to be much more the voice of the senior CEOs associated with it - the Ron Trotters, the Doug Myers of the world - and that's the way I'd prefer it to be: leading

businesspeople in this country running big organisations, standing up and speaking about things they care about to do with the future of New Zealand. That has fallen away."

Part of the problem, he believes, is that many of our most prominent CEOs are now hired from overseas.

"They're not as attached to the country as previously and as a consequence, contrary to the first 10 or 15 years of what we were doing, I have become more prominent, and I don't particularly like that."

It is also notable that the Roundtable has never had much female input, and even now has only one woman who is a full member, ASB Bank chief executive Barbara Chapman (she is also a member of the NZ Institute).

Kerr appears genuinely perplexed by the dearth of women in senior management, and agrees it is an important issue he'd like to see corporates addressing "in a more systemic fashion".

On the other hand: "I don't have a view of the world that says the natural state of affairs is 50/50. That seems ridiculous," he remarks. He also suggests there have been cases "where women have been promoted beyond their competence in this country, and I think that's bad all round really."

Oh dear. Given his health issues, it is hardly surprising that speculation has begun about who might replace Kerr when he eventually decides to retire. Herald columnist Fran O'Sullivan has noted that Rodney Hide might be looking for a new job.

Kerr is quick to note his position is not yet vacant, and in any case: "I have no idea whether Rodney would be the slightest bit interested or would be seriously considered for the job".

In his opinion, the ideal candidate would be someone equally capable of heading Treasury or the Reserve Bank "or organisations of that sort".

It may be that the Roundtable's board has other ideas, he agrees, "but I don't hear anybody saying that".

"Other things being equal, I'd contemplate doing another parliamentary term - that might be a good time to call it quits. But there are questionmarks from a health point of view and if there's a change of government at this election, would I be the right person to head this organisation? We might want to think about that at that stage."