Business stops 'wimping out'

After a period of self-imposed silence, business people are now challenging the Government, write FRAN O'SULLIVAN and GRAEME HUNT.

The spectacular rise of National leader Don Brash in the opinion polls has created a climate where business feels it can openly take issue with Government policies without being pummelled in response.

Many respondents to the Herald's corporate survey said a wider debate on the Government's attitude to business had ignited in the wake of Brash's controversial reshaping of the debate on race relations and the Treaty of Waitangi.

Business people had kept their heads down - or sheltered behind business lobby organisations - rather than risk public ostracism by openly taking issue with "anti-business" policies.

But others question why business allowed itself to become subservient in the first place.

Brash set the race-relations agenda in January with an outspoken state-of-the-nation speech to the Orewa Rotary Club. It caught the Government on the back foot but returned National to the status of a credible Opposition.

"Brash has made it acceptable to debate subjects that were not politically acceptable to debate," said Ian Frame, chief executive of Wellington-based investor Rangatira Ltd.

"I am not referring to the race issue ... I am referring to the restructuring of the economy that took place in the 1980s and early 1990s.

"Brash has opened up the discussion and there is a whole level of debate now taking place."

Frame believes the reforms of the fourth Labour Government and the National Government that followed were essential to improving competitiveness.

"We attracted a lot of investment and [the economy] started to grow. Currently the economy is trading on that period. But we are sliding downhill and I suggest it is quite a steep slide."

Waste Management NZ managing director Kim Ellis said business had itself to blame for allowing the Government to impose changes that were costly and made it less competitive.

"The business community has been so subservient," said Ellis. "But with Brash you can feel a certain effervescence that there is a chance for making a change. We see the possibility that we will have a credible Opposition and a closely fought general election."

But Ian Watson, deputy vice-chancellor of Massey University's Albany campus, said the Government deserved credit for talking to business. "The Prime Minister and the Deputy Prime Minister probably deserve some marks for trying," said Watson.

"Both, however, are academics, admittedly with a good grasp of economics, but unfamiliar with the day-to-day hassles of business.

"Furthermore, they are surrounded by others whom one might objectively describe as anti-business."

Watson said some of what Brash said at Orewa was unfortunate, but he had opened the Treaty of Waitangi to regular discussion.

Not all business sentiment is falling Brash's way.

A number of survey respondents suggested that while the treaty needed to be debated, there was a risk that New Zealanders would be pitted against each other.

"Why not support the Prime Minister's inquiry?," asked one Wellington financial company head.

The treaty rated as a major negative issue for business in this year's survey.

But there was far less unprompted comment than in the Herald's November 2002 Mood of the Boardroom survey, suggesting business has already moved on.

Business people interviewed after Brash gave his "tax speech" last week suggested there was a risk that if the National leader made many policy concessions simply to attract votes, he would lose appeal.

"It's not as if someone earning $60,000 a year is rich," said one respondent after learning Brash had scuppered earlier policies to cut the 39 per cent top rate.

Another suggested Brash should not be allowed "to get away" with ducking debate on controversial issues such as health. "How is he going to fund a boost to the defence budget to get in good with the Aussies?" asked another.