Michael Barnett: Business success the key to Labour's prospects

1.30pm

With the economy weakening and politics less certain, the election night pledge of Prime Minister Helen Clark to form a government focused on building economic growth and jobs will reassure business but only to an extent.

Quite clearly, what sustainable confidence business will have in relationships with the next Government depends on what arrangements the Prime Minister makes in the coming days for working with the minor parties to the left of Labour's command of the centre - the Greens- and to its right, United Future.

The choice is Labour's. With 52 seats, 25 more than the next highest, National, and with five other parties to work in coalition with, Labour is in the box seat to drive parliament's agenda issue-by-issue.

Regardless, with global prices for New Zealand's core products contracting and political uncertainty increasing, business faces working in a much tougher environment under the next parliament compared to the last.

During the last parliament, the government eventually put in place measures designed to encourage business to find new markets and add value to products and services. Pledges were also made to fix Auckland's transport problems by inviting business to contribute directly through private-public partnerships.

Delivering on these promises and building an economy with sustainable growth locked in place is what the next three years should be about. It will be the job of business organisations to help Government keep its eye on the shared goal.

Plainly, a good start would be to make it clear that forming a coalition with the Greens should therefore now be off Labour's agenda. They oppose economic growth, they oppose building international trade relationships and they oppose fixing Auckland's third-world roading network.

How can a government focus on sustained growth with an "anti-growth" partner in tow?

To align itself to an arrangement where these policies are at the centre of policy development for the next three years would be economically as well as politically stupid, especially given that the emerging United Future party of Peter Dunne offers prospects of a pragmatic alternative.

Smart business will not be spooked by the uncertainties created by this fragmentation election result, and its capture by a media toy - a worm that some argue has determined the shape of parliament for the next three years. Business confidence in the environment will take a dive, but most individual businesses will stay focused on doing what they do best - getting on with business.

* Michael Barnett is chief executive of the Auckland Chamber of Commerce.

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