Put private investors' money into road projects: National

A National-led government would encourage public private partnerships (PPPs) in roading as well as energy and prisons, finance spokesman John Key says.

Responding to a Business Herald survey of the major parties, asking how they would encourage savings and strengthen financial markets, Key said New Zealand was an anomaly among developed countries in that it did not have an infrastructure asset class.

He envisages private sector fund managers setting up unit trusts or issuing bonds tied to specific infrastructure projects. The policy would require changes to the Land Transport Management Act to make PPPs more attractive.

Commerce and Transport Minister Pete Hodgson's press secretary, Christian Judge, said the act already allowed for PPPs but few transport projects were big enough. As well, PPPs had not been able to compete with the price of debt funding.

Key said National would also look at regulating the new Unlisted share market, which Hodgson this month opted to leave alone.

He said the Government was not moving fast enough on regulating non-bank finance companies, but Judge said a review of the non-bank finance sector was announced in May and the work was ongoing.

National is also keen on boosting saving but does not think the voluntary Kiwi Saver scheme, announced in the Budget, is the answer.

"The reason that many people are not saving is that they are struggling to make ends meet," said Key. "Kiwi Saver doesn't change this." Any plans on encouraging saving would have to wait to the second term of a National-led government.

Other parties were also keen to boost savings but had different ideas on how to go about it. "The big problem that we see is people don't have enough money," said Act leader Rodney Hide. "Income tax is a double tax on savings. That's why we are keen on lowering income taxes."

Greens co-leader Rod Donald said the party supported the Kiwi Saver scheme but the real issue was about income adequacy. The Greens wanted to see the minimum wage and benefits increased.

The Greens also want contributions to superannuation tax-exempt, instead imposing tax when the income is withdrawn.

If United Future was part of the next government it would push a womb-to-tomb savings scheme for all children. Finance spokesman Gordon Copeland said the government would open a savings account for every new baby, depositing $500.

New Zealand First wants a compulsory superannuation scheme, which leader Winston Peters said would ensure future generations had certainty on retirement incomes.

Progressives leader Jim Anderton said cutting the corporate tax rate to match Australia would encourage investment here.