The Prime Minister’s state of the nation speech at the opening of Parliament covered important issues for business.  Much of the content is in line with NZICT Group’s Near Future Digital Priorities released in December last year, and with Business NZ recommendations advocated last year in Setting New Zealand Apart and will clearly be given thumbs up by the business community.  The focus is on the Government’s ‘6-pack’ plan (improvements in regulation, infrastructure, public services, skills, innovation and tax).

Tax

• The Government has clearly signalled that proposals for a land tax, a capital gains tax, and a risk-free return method will not go ahead. 
• What is on the agenda: an increase in GST (no more than 15%), lower personal tax rates and changes to the way property is taxed - with more details to come in the Budget. 
• While there was no overall reform of Working for Families announced, there was an indication that there will be changes to prevent high income earners from abusing the system.
• One glaring omission was any discussion on the Australian Henry tax review or on compulsory superannuation.  Any moves by the Australian Government to lower their company tax rate would need to be met by the same change on this side of the Tasman.   We would expect the Government to be ready for such an eventuality if it arises this year.

Better Public Services

• This year the Government will continue to drive savings in the public sector, demand stronger performance from government agencies, and lift the quality of public services.
• They began that process last year by capping core government administration and by conducting a line-by-line review of expenditure as part of the 2009 Budget. That review identified a total of more than $2 billion in spending over four years that was redirected to frontline services.
• That was not a one-off exercise. The PM indicated that the pressure on government departments to lift their game will be constant. Most agencies will see no additional funding for several years. They will therefore need to make enduring and significant changes to the way they operate, including reorganising their back office administrative functions, making better use of technology, exploring innovative options for delivering services, and sharing support services with other government agencies.

Innovation

• We are pleased to see a strong focus on increasing investment and focus on science and innovation, in line with our Near Future Digital Priorities, and we look forward to seeing details as soon as possible.

Regulatory Reform

• The Prime Minister’s remarks on regulation highlighted the work programme of reviewing existing regulations to identify and improve or remove those that are unnecessary or ineffective, but there was no significant detail announced e.g. around a Regulatory Responsibility Bill or the establishment of a Productivity Commission.

Emissions trading

• Comments on emissions trading stressed the need for a balance between environmental and economic concerns.  We also see technology development opportunities in this area.

Access to natural resources

• The intention to better utilise New Zealand’s significant petroleum and mineral resources was outlined. 

Labour Law

• The Government will look at whether labour laws are imposing excessive costs on business and hindering job creation.
•  The PM indicated that legislation to improve  the Holidays Act will be introduced later in the year and that problems with personal grievances under the Employment Relations Act will be investigated.

Education and skills

• The statement included a focus on young people and pre-employment education and training and greater opportunities to learn trades and practical skills including technology in schools.  We will be working with the Ministry of Education on this development.
• In tertiary education, the statement focused on getting more value from the dollar and more relevance to the workforce.

Trade

• The government wants to further progress the Single Economic Market with Australia and progress the many trade deals currently under negotiation.

NZICT Group’s advocacy will be focused on getting good and speedy execution of the stated plan.  Thanks to Business NZ for their assistance in the review of the PM’s address.

Interview on NZI Business, February 1st.

Watch the TVNZ video (3:23 minutes)

ICT Industry body NZICT has backed the government’s film tax credit scheme following the government’s decision to give nearly $45 million in taxpayer money towards movie blockbuster Avatar.

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Avatar’s success has spawned the first of what industry supporters hope will be a new group of IT start-ups.

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New Zealand spends about $6 billion annually on domestic IT requirements, industry lobby group NZICT says.

The government absorbs around 40% of that, while the corporate sector takes up the remaining 60%. NZICT chief executive Brett O’Riley said technology was one of New Zealand’s fastest growing industries. Mr O’Riley said this was reflected in the recent Deloitte Technology Fast 500 report, where 51 New Zealand companies were included.

Read the full NBR Article

Concerns raised about potential lock-out of Kiwi ICT suppliers.

NZICT’s near-term ICT priorities plan for New Zealand has received praise from representatives of the New Zealand user community following its release on Monday.

However, some local ICT suppliers are concerned about the plan and the direction of the new industry lobby.

 Read the full Computerworld Article

The chairman of the NZICT Group, Cisco managing director Geoff Lawrie, pushed members to demonstrate the value ICT can deliver at the vendor group’s end of year meeting on Friday 4 December.

Read the full Computerworld Article

Communications Minister Steven Joyce has given a guarded welcome to dozens of recommendations set out by NZICT.

Read the full article  published by Dominion Post 14/12/2009

NZICT, the group that represents vendors in the ICT industry, has today released a paper on the near future digital priorities for public and private sectors. read more »

The purpose of this paper is to set out the Near Future Digital Priorities for New Zealand identified by NZICT Group from consultation with its members, Communities of Interest and key stakeholders including Government agencies.

NZICT consists of nearly 80 members representing companies and organisations involved in the provision of software, hardware, services, networks, education and training.  They are involved with five core strategic work streams with the goal of improving New Zealand’s competitiveness for the betterment of all New Zealanders. The strategic work areas are Education & Skills, Innovation, Public Sector Productivity, Small Business Productivity, and Industry Value & Profile.

This paper focuses on these core work streams as a platform from which to launch the country’s near future digital priorities.

Read the full paper:

Near Future Digital Priorities paper - December 2009 (PDF format)