Interesting editorial on National’s new Productivity Taskforce in Saturday’s Herald. Australia’s Productivity Commission (independent, highly successful, and enjoying cross-party support) could have served as a good model, but:
That possibility was ditched with the appointment of Dr Brash, whose excellent credentials as a former Reserve Bank Governor are compromised by his political partisanship. This will make it harder for the taskforce to gain credibility. Therefore, it is especially important that the yet-to-be-announced members come from different parts of the political spectrum.
Good advice – what do you suppose are the chances of it being taken? Further interesting points follow, with a quick mention of the research on why the gap with Australia has opened up:
A key factor seems to have been capital shallowness; on average each New Zealand worker has had less plant and machinery to work with. While this country has had plenty of noses to the grindstone, Australia has invested in a superior grindstone.
Hello captains of industry – are you listening? Of course it doesn’t help that some of the funds that the Aussies buy their superior grindstones with are profits repatriated from NZ. Anyway, the most telling comment:
Many of the most important decisions that will underpin improved labour productivity lie with the private sector.. But governments have a role to play in infrastructure, the teaching of skills and in encouraging a culture of saving, thereby providing a local and cheaper source of investment capital.
This is interesting both for what it says, and what it doesn’t say. What is says: infrastructure, the broadband initiative is at least in the right ballpark, though arguably misguided and a much smaller step than we were lead to believe.. Otherwise, can’t we do better than cutting research funding and tax credits and building yet more roads? Teaching of skills, an obvious dismal failure of vision from National. Encouraging saving, another fail, with reductions to KiwiSaver and the poor example of cancelled contributions to the Super fund.
So what doesn’t it say? What doesn’t get suggested as government drivers of productivity? Privatisation. Personal tax cuts. Abolishing the minimum wage and driving wages downwards. Gutting the Public Service and contracting out. All the proven failed policies of the neoliberal revolution favoured by National and their productivity Czar Don Brash.
In short, someone at The Herald gets it. They know what needs to be done (National are going backwards). They aren’t pushing National’s wrongheaded agenda. Why don’t they just come right out and say it? National have it all wrong. Why isn’t The Herald shouting it from the rooftops?
– – rOb