Govt calls local business inquiry 'stunt'

A former business associate of Economic Development Minister Steven Joyce is calling for "affirmative action" to help local manufacturers at an inquiry which the Government says is a "stunt".

Speaking at the Opposition inquiry into manufacturing, Bruce Moller, chief executive of Taranaki medical bed manufacturer Howard Wright, said his company was given advantages when bidding for public sector contracts in New South Wales, but not here.

Mr Joyce was a director on Howard Wright's board for almost a decade, resigning shortly after National formed the government in 2008.

Mr Moller, who joined Howard Wright in 1991 and led a buyout in 1997, said Australian states made adjustments to the public sector tender process to give small and medium sized enterprises, including New Zealand companies, an adjusted price.

While some New Zealand government departments gave support, others worked in "complete silos", Mr Moller said.

"We might find we're working on something where there's absolutely no consideration that you're a New Zealand company, creating jobs."

Labour, Green, NZ First and Mana organised yesterday's inquiry, although Hone Harawira did not attend and Russel Norman was the only leader to attend all of the submissions.

Last year, Prime Minister John Key labelled the inquiry a "political stunt" because no Government parties were invited to take part.

Yesterday, Mr Joyce said the inquiry, set up to address a "crisis" in the sector, was unhelpful. "Nobody is arguing that being a manufacturer isn't challenging. But going around trying to talk down the New Zealand economy, and talk about a crisis in manufacturing, I don't think is particularly helpful."

Many of the submissions were dominated by calls for the Government to intervene to attempt to lower the New Zealand dollar.

Keith Whiteley, managing director of Christchurch-based CWF Hamilton - famous for the Hamilton Jet - said while the company had a world leading market position, if the dollar stayed strong for another 2-3 years its profits would be wiped out. "We think it's time that the Government did its bit. The single monetary policy goal of targeting inflation alone, while relevant in the 1980s when inflation was out of control, is now passed, in our view, its used-by date. Exchange rate consideration must become part of the mix."

John Walley, chief executive of the Manufacturers and Exporters Association, said the industry needed the Government to take steps for which there was no objective justification, but which trading partners were using to boost their industries.

"It's about levelling the playing field in some regard."

These included tax credits for research and development and accelerated depreciation on productive assets. Fairfax NZ

Taranaki Daily News