Suits unmoved by Govt spin

By DITA DE BONI

Like a frigid maiden unmoved by lukewarm seduction, the business community waged a mostly silent, stony-faced protest as Government ministers fanned out across the country to defend the Budget.

Over smoked salmon and croissants at dawn, followed by cajun-spiced chicken breast for lunch, men and women in their corporate stripes heard the Beehive spin from the cabinet heavyweights.

The message from Michael Cullen, Helen Clark, Pete Hodgson and Jim Anderton was simple - if they all cooperated and had a little patience, the reward would be economic growth and improved confidence.

Unfortunately, the epicurean delights of breakfast were almost as cold as business sentiment by the time they reached hungry punters around 8 am, although both the food and the mood had warmed by the time the Prime Minister beat her drum for a lunchtime corporate crowd.

While the two sides may be at an impasse over aspects of fiscal legislation, a full house of politicians and business figures at two Auckland events suggested that interest remains high.

Helen Clark went so far, after the closure of a fog-bound Auckland Airport, as to charter a private plane to get her to the Carlton Hotel in time for coffee and cheese at the lunchtime gathering.

But it seems unlikely that either party will have gained complete satisfaction from the forums. Question periods at both events were stifled by the time constraints of the officials and typical reticence from the guests.

The after-meeting mutterings suggested that the business community continues to feel uncomfortable about the Government's involvement in the economy.

The 9th annual NBR post-Budget breakfast, which started at a bleary-eyed 7 am in the hangar-like surroundings of Eden Park's ASB Stand, kicked off the day-long talk-fest.

Breakfast crowds in five centres were linked by telecast for almost an hour to put questions to Mr Hodgson, Dr Cullen and Deputy Prime Minister Anderton, speaking from Auckland, Wellington and Christchurch respectively.

Dr Cullen opened the batting, reminding the participants that the Budget was not "mana from heaven." As the gathered throngs munched on their pastries and coffee - primarily to stay warm - he said it was designed "not to satiate a roaring hunger" but was more like "fiscal finger food."

Dr Cullen was joined at his Wellington table by Associate Finance Minister Trevor Mallard, who spent the entire telecast silent and obscured by shadows.

In stark contrast, ebullient forum chair and Liberty Press head Barry Coleman was lit up like a game-show host - perhaps fittingly, given the event's alternate raison d'etre as a National Business Review brand-building exercise.

He also managed the only real laugh of the event, responding to Pete Hodgson's assertion that it was the first time a minister of technology had joined the breakfast forum, by saying it was "the first time a Prime Minister hasn't!"

The follow-up questions unveiled little, revisiting old bugbears such as why tax rates for high-income earners had been raised and how the Government intended to stem the brain drain.

Dr Cullen responded by pointing to Budget promises for increased funding to universities to stop fee hikes, and the suspension of interest accumulation on the loan balances of studying students.

Only one question left the Treasurer momentarily tongue-tied.

A wag from the audience asked what Labour would have done differently with the Budget had the Alliance and Greens not been involved.

Dr Cullen and Mr Anderton exchanged cheery chuckles at the question, stressing how the approach to the Budget document had been a "team effort."

A wooden Mr Hodgson was, by contrast, very much outside the twinkly-eyed club.

Fielding perhaps the most specific questions of all about the Government's controversial research and development grant package, Mr Hodgson was clearly ready to defend his newly expanded role as guardian of almost all R&D budgets.

Several audience members alluded to some disappointment over the Government's relatively small contribution to the pot, seeing $11 million as insufficient for the fund and wondering what criteria would be applied to applications for a piece of the coveted pie.

Mr Hodgson said the Government was "looking to grapple" with the issue of assisting private sector research. He emphasised that it was also learning as it went - with the grants the first of their kind - and took a quick side-swipe of his own at the private sector for not itself funding as much R&D as its overseas counterparts.

Punctuating Mr Hodgson's gravity and Dr Cullen's one-liners, and true to his pre-election form, Mr Anderton again came out tops for his ease and joviality in front of a sceptical crowd.

He defended a steep rise in the price of cigarettes as an effective tool to stem the huge costs of smoking-related illness and death, and dismissed the idea that unions would disrupt workplaces.

To questions about the forthcoming People's Bank, Mr Anderton replied it would not operate like the BNZ of old, which he described as the "Wild West without a sheriff."

"The people's bank has to be a viable financial operation, it has to be a safe investment for people's money," he decreed.

But the polite tenor of the breakfast meeting dissolved as the participants, grumbling discontentedly, poured into an impressive array of shiny BMWs, Audis and Porsches after the meeting.

Several voiced frustration at the usual closing exhortation to keep the lines of communication between business and the Government open, but if they were sick of that message, they were in for another dose of the same at Helen Clark's lunchtime dialogue with business groups at the Carlton.

Helen Clark's approach to a decidedly more feisty question time was conciliatory in tone, but carried the same message as her morning cohorts. Tax breaks for R&D would encourage "creative accounting" so grants were better (though she hinted that the policy was changeable), business and the Government had admittedly been in an ideological conflict between "right and left" in the past, but should get over it, and the caucus would look to "rake back" through the Employment Relations Bill to mollify concerns.

The Prime Minister's only brush with audience antagonism came when she asserted "we need you as much as you need us" - a statement met with audible snorts from several tables - but promises to look into a partly Government-funded export credit scheme and a declaration of her "agnostic" stance on a common currency with Australia, seemed to modify her underlying assertion that the Government intended to honour its promises to its electorate.

It was, perhaps, Michael Barnett, the Auckland Chamber of Commerce chief executive, who met that threat with a veiled threat of the business community's own - one the Government cannot afford to ignore if it wants to be returned to power on the back of business confidence in two years' time.

He said while business was a willing partner and would work with the Government in "good faith," it represented the "risk- takers and innovators of the country."

"[As such], they have a choice where they run their businesses, and, for the good of New Zealand, we should all hope it is here."

Budget 2000 feature

Minister's budget statement

Budget speech