Oct 10, 2008

Well We Have Called For Leadership

And good on Skilling and Weldon for rising to the challenge.

We don't think that we will achieve a consensus on these ideas quickly but we share their desire to stimulate a debate.

The idea of a Temasek style vehicle to support our growth strategy interests us enormously. We have had similar ideas ourselves. We have also argued for some time that we should be integrating the strategies being pursued by the NZSF, EQC, ACC and our wider trade and investment strategy. We would support fully these ideas being picked up in a wider review of industry and export strategy which we see as urgent post election.

The one area of disagreement would be around the R&D tax credit. We don't think that this was that well designed or effective. Our view is that lower tax across the board is much better for the economy than trying to support but a few companies. Feedback from those using this policy was mixed as there was a high compliance price.

We share the view that retirement savings should be compulsory, but would not want that rate to be any higher than 2% contribution by both employee and employer in the short term - we need to keep cash flowing through the economy.