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During 2023, you’ve probably thought a lot about tech, be it when you’ve been impacted by a cyber attack or ever-growing online fraud, lost broadband or phone service during wild weather, or fretted about AI taking your job or allowing your kids to cheat on their homework.
But with early voting opening on Monday (and remember, 68 per cent cast an advance ballot in 2020), each major party has only one Big Bang tech policy on the table.
Last month, National promised a Graduate Visa (capped at 500 applicants), a Digital Nomad Visa (250) and a Global Growth Tech Visa (250) for high-skilled applicants earning $400,000 or more per year.
The visas got a warm reception from the tech community, which has been grappling with a long-term skills shortage.
Despite intensive networking and several policy pow-wows (which have kept her profile high and put her in good stead with the tech community as Labour worked through a succession of IT ministers, all distracted by other portfolios), that’s been it from National’s spokeswoman Judith Collins in terms of hard policy.
National also promised to “investigate” changes making it easier for cash-strapped start-ups to reward employees with shares. Currently, unrealised gains are on employee stock ownership plans (”esops”) are taxed. Although it did not make the cut as a formal policy, start-ups the Herald spoke to thought Collins would see it through.
Overseas voting opens Monday, early voting for all-comers on Oct 2
— Chris Keall (@ChrisKeall) September 26, 2023
In 2020, 1.98 million people (68% of those who cast a ballot) voted before election day
Covid influence in 2020, but also a pervasive trend in 2017 & 2014 as early voting has become easierhttps://t.co/rCP6SFYBZW pic.twitter.com/VI3BvMpK2T
The party has also promised a “Technology Minister” - but arguably, that’s semantics.
Neither party has dropped the portfolio, they’ve just favoured broader titles for it over the past decade. The incumbent Ginny Andersen is Digital Economy and Communications Minister; while Collins is National spokeswoman for science, innovation, technology and digitising government.
In a related area, biotech, National says tech advances mean New Zealand’s ban on genetic modification could be lifted. And in education, it’s promised to ban cellphones in schools.
Tech doesn’t actually feature at all in the party’s “priorities” list but just before Parliament rose, Labour introduced the Digital Services Tax Bill, dubbed a “Google tax”.
There was never any prospect of the legislation making it to its first reading, so we’ll call it a tech policy for the election by default. It involves imposing a flat 3 per cent tax on revenue a multinational tech firm earns from its New Zealand users. It came at a time when Big Tech firms are still quite assertive in the (perfectly legal) steps they take to minimise their New Zealand operations’ tax exposure.
On the con side, Labour has not been great at seeing Big Tech policy through (then Revenue Minister Stuart Nash first floated a Digital Services Tax or DST in 2019).
Regardless, it’s not seismic. The party says the measure of $222 million (or $55m per year) over four years comes at a time when critics say many times that amount is being lost to revenue-shifting.
And a Ministry of Foreign Affairs policy impact statement, published with the bill, warned of retaliatory tariffs by other countries that take as much money as a DST raises for New Zealand.
If the Digital Services Tax Bill had made it to its first reading, Collins told the Herald she would not have voted for what she calls “the app tax”.
The major parties’ platforms are more notable for their missing pieces. The absent include:
Artificial intelligence: Australia’s Budget 2023 allocated A$101.2m ($108.6m) to a critical technology fund to help create governance rules for AI, and support small and medium enterprises’ adoption of AI technologies. There was no equivalent here, and AI doesn’t feature on Labour or National’s platforms.
Tax breaks for venture capital: At National’s tech policy launch, Maker Partners co-founder Jonathan Reid was very positive on the policy overall, but said he was disappointed it did not feature tax breaks for venture capital investments - one of several recommendations floated in the recent Startup Advisors Council report that did not make the cut for National’s policy (or, indeed, any other party’s). Collins said that, for now, New Zealand’s debt level precluded it.
Procurement, education: NZ Rise co-founder Don Christie said he wanted to see major parties release policies for building the local tech workforce.
Start-up funding: The Startup Advisors Council also wanted the NZ Growth Capital Partners’ $300m Elevate fund boosted to $500m (the Crown agency co-invests with private venture capital.) Neither National nor Labour have said if they will renew the now all-but-exhausted fund, let alone to what level.
Remove barriers to super funds investing in start-ups: The Startup Advisors Council wanted to remove barriers to KiwiSaver funds investing in early-stage firms, too. Again, this hasn’t been picked up by either major party - although it was the only one of the council’s 27 recommendations that Act said it would support (Act’s minimalist approach is in keeping with the small government approach that once saw its MPs vote against the UFB).
Australia’s Budget 2023 also had three other tech policies not adopted by Labour or National:
Cyber security: Australia’s Budget 2023 had A$46.5m ($76.34m) earmarked to establish a Co-ordinator for Cyber Security to oversee multi-agency efforts in the event of a cyber incident.
E-safety: The Australian Budget also had the e-Safety Commissioner’s annual funding quadruple with a A$131m injection. The equivalent agency here, Netsafe, has a budget of around $4m.
Online fraud and scams: The Aussies also earmarked A$86.5m ($93m) to establish a new National Anti-Scam Centre.
What about areas like cyber security, AI and the hot potato of procurement, where the likes of NZ Rise have complained about big tenders, worth hundreds of millions, always going overseas?
This morning, the Herald asked Collins, all but Technology Minister-in-waiting, going by polls, if there was any tech policy behind the visa policy and the investigate Esop (employee stock ownership plan) changes pledge.
“That is it at this stage,” Collins said.
Other policies could only be finalised once the party had the full view of things it could only gain if it wins power, she said. A more cynical take would be that with National so far ahead, there’s no need to over-commit.
During its current term, Labour introduced a 20 per cent tax rebate for the fast-growing video game industry. While only half the amount dangled across the Tasman, the big gaming firms said it was enough to stop them defecting to Australia, as they had been threatening (through a PR campaign steered by Conor English).
Other initiatives have been modest, including $15m for closing the digital divide and the watery Digital Boost campaign (offering small businesses online tutorials, some of them little more than advertorials for various tech firms’ services).
The Digital Services Council - which replaced axed-before-he-got-to-his-desk tech czar Derek Handley - was quietly and mercifully put to sleep last December.
Telcos were not leaned on to improve network resilience after Cyclone Gabrielle, but Spark, One NZ and 2degrees did get free 5G spectrum in return for pledges to spend at least $22.5m on improving mobile coverage for rural areas. We’ll see how that quid pro quo plays out.
Here, there was no substantial new cyber security or anti-scam spending.
GCSB Minister Andrew Little did move Cert NZ (the “triage” agency for individuals and small businesses) under the GCSB’s National Cyber Security Centre in August. Ahead of the change, Little said: “The current system is fragmented, creating a ‘merry-go-round experience for business victims’ of cyber crime.”
Cert NZ would have more oomph in its new home. Critics have wondered if the mum-and-dad-focused Cert NZ will be an easy fit for the NCSC, which is more used to working with the likes of Fonterra and MFAT as they face rogue state opponents.
Little has also proposed shifting Netsafe under Internal Affairs’ thumb. Critics - including retired District Court Judge David Harvey - have questioned whether the move would undermine Netsafe’s independence.
Netsafe is the lead agency for the Harmful Digital Communications Act (which falls under the Ministry of Justice’s umbrella). Harvey has questioned the logic of moving away from its current Justice and Ministry of Education support and funding.
The initial promise of the Christchurch Call withered as the major social media firms culled their safety and content teams - in some cases savagely - as the tech downturn hit.
Then there was the Startup Advisors Council that the Government formed, which on August 1 delivered 27 recommendations.
The Government did not immediately commit to any of its ideas, saying it would “take time to carefully consider the council’s report”.
The recommendations were already well known to Cabinet by that point. Council members told the Herald they had met multiple times with ministers, and forwarded them draft versions over the months leading up to the public version.
Labour: 3 per cent tax on big tech firms’ revenue from New Zealand customers
National: 1000 new visas to attract tech talent
Greens: Raft of initiatives to address the digital divide, diversity issues
Act: Make it easier for super funds to invest in start-ups
New Zealand First: No mention of tech in its 36 headline policy points
Te Pāti Māori: New Zealand should create a national clean tech strategy.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
Scott Humphrey, founder of Humphreys Landscaping, talks about the business, his customers and its new foreign owners. Video / NZ Herald