November, 2007

CTU Economic Bulletin No. 86

Submitted by Editor Policy on 30 November, 2007 - 14:01.

November 2007

Either read on or download a printable version here (MS Word 238k)

Comment

After 8 years of Labour-led Governments there is by now a long list of achievements that indicate a ‘worker-friendly’ approach. Such a list would include 4 weeks annual leave, 14 weeks paid parental leave, scrapping the Employment Contracts Act, lifting the minimum wage by over 60 percent, KiwiSaver, higher pay for teachers and nurses, the ACC scheme brought back into complete public ownership and so on. As a union movement, we have been prepared to acknowledge these gains while continuing to push for further improvements.

But this Government has also been a ‘business-friendly’ government. Recognition of this has been hard to discern. For instance, in 2005 the business community hardly acknowledged $977 million over 4 years in the Budget to allow for higher depreciation. Companies are due to receive a tax cut of nearly 10% in April next year, the first cut in company tax since 1989. The tax credit of 15 percent for research and development expenditure is another major boost for business. There is also expanded export market development assistance. From an initial funding pool of $6.7 million in January 2005, the scheme has grown to more than $50 million annually. The annual value of support for business under just these four initiatives (depreciation, tax cuts, and export assistance) adds up to over $970 million a year.

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