Government to unveil cost-cutting plan

By KARYN SCHERER

The Government is expected to reveal tomorrow its plans to cut costs for small and medium-sized businesses.

Six months after setting up an 11-member panel to conduct yet another review of compliance costs, Commerce Minister Paul Swain faces a significant challenge in persuading the business sector that the Government is serious about the issue.

Several Government departments are understood to be unhappy about the panel's recommendations, which focus on key pieces of legislation such as the Resource Management Act, the Health and Safety in Employment Act, and the Statistics Act.

The panel, chaired by McDonald's managing director Al Dunn, is also understood to have recommended changes to the tax system.

Although tax issues were originally intended to be dealt with in a separate tax review, widespread criticism raised at a series of regional meetings persuaded the panel the issue needed to be addressed.

It is understood the panel has also stressed that a "one size fits all" approach will not work.

The panel is one of several initiatives launched by Labour to address one of the business sector's biggest bugbears.

Other initiatives include a review of progress since a 1998 select committee inquiry into the issue; setting up panels of business people to audit compliance costs of new regulations; and ensuring new laws and regulations are accompanied by a statement outlining their effect on compliance costs.

While National is expected to applaud the panel's recommendations, is it is also likely to argue that several pieces of Government legislation have already made the situation worse.

In May, National and Act members of the select committee considering changes to the Resource Management Act protested that the proposed changes would increase, rather than reduce, existing compliance costs.

The Government has delayed progress on the RMA bill until the outcome of this week's report.

National's small business spokesman, Warren Kyd, said the party would be closely monitoring progress on the panel's recommendations.

"Quite frankly, we wish we'd done more. But I think any reasonable cost-cutting measure we will applaud because we think business needs every chance. "

Mr Kyd said he was also concerned that Labour might be running out of time.

"By the time they put it into legislation and get stuff into the House, not much can happen this year. Although they promised a lot, they look like being thumped and business is in no mood to be pushed around."