KEY POINTS:
Businesses are likely to see investment in workplace skills development and a commitment towards further infrastructure and transport initiatives in this week's Budget.
But industry players are not hopeful that Finance Minister Michael Cullen will make any large-scale cash injections for business-friendly initiatives.
Business New Zealand chief executive Phil O'Reilly said Thursday's Budget would contain some investment in workplace skills development.
"I'd expect either significant new funding or some significant reallocation of funding into that space. I'm not optimistic about seeing massive new expenditures, but some reallocation of expenses or a pathway towards that will be helpful."
Business NZ was hopeful of initiatives on improving trade skills, and workplace literacy and numeracy.
"Inevitably any investment in skills is never large enough. It's a big hole you pour money down in some cases, but it's pretty mission critical."
He was also looking for positive moves - if not direct pledges of additional funding - towards investment in broadband and roading, and signals about private-public investment in infrastructure.
"I'd be surprised if they said absolutely nothing given the commitments that they've made over the last little while."
An adjustment in personal tax rates would also be beneficial for business, said O'Reilly. "A lot of very small businesses actually pay personal income tax - because they're unincorporated they're not actually paying the company rate, they're actually paying the top personal rate."
While business leaders generally have low expectations for the Budget this year they have no shortage of ideas about what it ought to contain.
Bruce Goldsworthy of the Employers and Manufacturers Association (Northern) echoed O'Reilly's sentiments, adding that he would like to see signs of a further reduction in the company tax rate.
"I think the important thing is that there is a signal to business that it is the intention to continue to reduce company tax. There needs to be some signals that this Government actually cares about business."
Open Country Cheese director Wyatt Creech - a former National Party deputy prime minister - said there had to be a review of the policies which were driving high interest rates.
"And I think they have to look at the policies that are causing the dollar to remain so high for so long and they're all tied together," Creech said.
He was not expecting any further large funding initiatives following March's announcement of the $700 million NZ Fast Forward fund aimed at pastoral and food industries.
Federated Farmers president Charlie Pedersen said the government had been identified as one of the most inflationary factors in the economy.
"We do believe inflation in New Zealand and the efforts to stem that through interest hikes does drive the kiwi dollar and has disadvantaged our sector more than any other."
A tax break for people would benefit the economy and probably take some pressure off the official cash rate in the medium term by getting rid of some internal inflation and some of the big spending by the Government, he said.
"If the Government gives Kiwis a tax break there's automatically going to be less government spending because they'll have less to spend."
Don Braid, group managing director of Mainfreight, would like to see less government and a greater explanation of the future of rail following the purchase from Toll. "It needs to be clarified quickly but I'm not sure this Budget is going to do that."
Port of Tauranga chief executive Mark Cairns said he understood there would be extra funding available for rail. "[It] is extremely important to our port given that 40 per cent of all cargo comes into or out of the port on rail."
There was a move to double the amount of freight carried coastally, he said.
"There's a signal that there is a provision for funding to encourage that. It's good news that there is some in the Budget and I'm certainly interested to see how much is put aside."
Trevor Hall, chief executive of Tourism Holdings, wanted to see more money spent in conjunction with Air New Zealand to promote the country.
"Now is the time in the cycle to promote product and price."
Hall also wanted incentives for companies investing in emission-efficient vehicles.
* THE WISHLIST
Business New Zealand chief executive Phil O'Reilly
A lot of very small businesses actually pay personal income tax - anything that's done with that top tax rate will be of value to them.
Federated Farmers president Charlie Pedersen
If the Government gives Kiwis a tax break there's automatically going to be less Government spending.
Bruce Goldsworthy of the Employers and Manufacturers Association
I think the important thing is a signal that it is the intention to continue to reduce company tax. There need to be some signals that this Government actually cares about business.
Methven chief executive Rick Fala
Right now retention of staff is probably one of the biggest dilemmas that businesses have. The ability to offer staff more than just financial incentives but training and development incentives is now hugely important.
