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A week in advocacy 

Commercial lending down
Corporate lending and loans for commercial property fell by around a third in the first half of 2020 and even greater falls are expected in the second half.  The Reserve Bank’s Credit Conditions Survey says businesses are concerned about uncertainty around future demand, while banks are concerned about uncertainty around property values.  Banks say tighter lending standards are likely over the next 6 months.

Rates squeeze: better funding needed
Covid-19 has revealed the limitations of council rates based on property values, says the Local Government Business Forum.  It says many councils planned rates rises before the Covid outbreak but now face pressure by ratepayers to keep rates increases to zero, and as a result some councils will now struggle to fund anything beyond core services.  The Forum says rates based on property values and higher rates for business mean that businesses pay disproportionately more than other ratepayers to support council services, and a better funding system is needed.

Waste levies going up
Higher waste levies up from $10 to $60 per tonne and levies on construction and demolition waste will be introduced from next year, in a Greens-led move to encourage less waste going to landfills.  BusinessNZ supports waste reduction but says the increase will be a significant additional cost on businesses already struggling in the Covid environment.  BusinessNZ says more should be done to ensure the levy revenue goes into a contestable fund for uses like recycling plant and infrastructure, otherwise the levies will just be another tax, with little or no influence on waste minimisation. 

RMA gone by lunchtime
Under a National-led Government the Resource Management Act would be gone by lunchtime, Judith Collins says, as Covid-induced economic distress makes RMA reform essential.  The new National leader has previously proposed splitting the RMA into two laws dealing separately with developmental and environmental issues. Business would agree with the urgent need for RMA reform while noting all parties’ previous election promises to reform the Act have so far failed to materialise.

Critical workers held up at border
BusinessNZ welcomed immigration changes announced this week: more occupations are now in the skill level exception test and criteria for Essential Skills work visas have been improved.  But Immigration NZ must urgently provide clarity for companies wanting to bring in critical workers from overseas: “We need certain high-skilled workers, like specialist engineers for commissioning and installing new plant and equipment.  There are hundreds of jobs on the line if Immigration NZ is not able to approve entry for critical skills,” BusinessNZ’s Kirk Hope said.

Labour shortages threaten crops
Meanwhile, the horticulture industry warns it may have to reduce the harvest if labour shortages aren’t resolved.  Growers worry about investing in planting and fertilising without knowing if there will be sufficient labour to harvest crops next season.  It could lead to some growers quitting the business for lack of workers, thereby reducing New Zealand's food supply, Horticulture NZ says.  Hospitality, pork, shearing, dairy and agricultural services industries are also concerned about labour shortages, as thousands of working holiday visas expire by 25 September.

ACT on election business policies
ACT Leader David Seymour will address an EMA Forum in Auckland on Monday, discussing election policies for business and the economy.  This will be the first of a series of Forums with political leaders in the run-up to the General Election on 19 September.  BusinessNZ Network members can register for Monday’s Forum here


Business Update is a weekly update of activity and advocacy by the BusinessNZ Network

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