Business lobby groups

Nat's benefit policy stirs debate

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Business groups have welcomed the National Party's election policy on benefits but advocacy groups say there's cause for concern.

Under the policy, those on the DPB will have to work or train for fifteen hours a week, once their youngest child turns six, and people on sickness and invalid benefits who have been assessed as being able to work part-time.

"When the children are at school and not during the holidays, I think they should be doing something for themselves," says National leader John Key.

Long-term unemployed people will also have to re-apply for their benefits if National wins the election.

However the party's policy is not popular with some, including a 31-year-old solo mother on the DPB. The solo parent, who wants to remain anonymous, says National's proposals may prove to be too harsh. "It's putting so much strain on the families, and the parents. And you want to be able to be a good parent, you want to be able to be there for them when they come home from their day at school," she says.

Social Development Minister Ruth Dyson says the National policy will take New Zealand backwards. She says the approach is punitive and last time a similar approach was tried it resulted in an unacceptable rise in child poverty. A National-led government last introduced a controversial work for the dole scheme for sole parents and other beneficiaries in the late 1990s.

The Ministry of Social Development did a review of that scheme. It found many single parents wanted to enter the workforce and more of them did go off the benefit.

But there was not enough administrative support and parents had trouble finding childcare. Critics are concerned those problems could arise again. Some people's advocacy groups echo similar sentiments. "You want failure, you introduce work-test sanctions for DHB and the only people that will suffer are the children," says Paul Blair, Rotorua's People's Advocacy Centre.

There are also concerns that solo parents will just end up in low paid jobs. "By forcing out mothers into minimum wage labour so they can provide cheap labour for John Key's big business round table mates. They won't earn much more on their benefit...and the kids get inferior childcare and supervision," says Blair.

Despite drawing criticism from some advocacy groups, businesses say it's a way to create a productive labour market. Several business and employment groups have welcomed the policy, saying they support the principal of getting able-bodied people back into the workforce.

They say there is a demand for workers in retail, banking, and the hospitality sectors. "Even if employment is easing somewhat, retail always needs a large pool of people to keep it ticking over," John Albertson, Retailers' Association.

Meanwhile political scientist Therese Arseneau says National's policy will attract some voters and send other voters back to Labour. She says that National has finally adopted an election strategy suited to winning an MMP election. "It has softened its rhetoric, moved towards the centre on several key policy issues and challenged Labour for the crucial centrist swing vote. In 2008 National's strategy is intended to grow its vote primarily at Labour's expense," she says.

Trade group focuses on Japan

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Reinvigorating ties with Japan will be the first priority of a new business group aimed at expanding New Zealand's international trade and investment. The New Zealand International Business Forum, to be launched today, brings together leading exporters from the dairy, meat, fish, horticulture and software sectors and business organisations such as Business New Zealand, the Chambers of Commerce and Export New Zealand.

Chairman Graeme Harrison said the new group would seek to emulate the meeting of business and political leader in Washington last year which created some momentum for a free trade agreement there. Stephen Jacobi, who is executive director of the NZ-United States Council, would fill a similar role for the new group.

Japan is New Zealand's third largest export destination and second largest source of imports - "but we are only Japan's 43rd largest trading partner". Japan has made it clear it is not interested in a free trade agreement with New Zealand at this stage. But as such deals proliferate the risk is of being disadvantaged by preferential bilateral pacts between other countries.

A free trade agreement which gave US or Australian beef producers preferential access to the Japanese market would be bad news. Japan is New Zealand's second largest beef market despite a 38.5 per cent tariff. "But it's about investment too, and the wider relationship," Harrison said. "We want to build a stronger high-level business constituency in Japan for a closer economic relationship. It is also about working alongside government and saying we want more effort going into Japan."

Official efforts have been concentrated on negotiations with China with the aim of concluding a comprehensive trade agreement by April next year. "Over time we will develop further projects related to Korea and the European Union," Harrison said, "as well as supporting existing efforts with regard to Australia, the United States and China."

In addition to Harrison, the forum's board includes Don Elder of Solid Energy, Rod Carr of Jade, Charles Finny of the Wellington Chamber of Commerce, Robin Hapi of Sealord, John Maasland of Auckland International Airport, Jon Mayson of Export NZ, Tony Nowell of Zespri, Mike Petersen of Meat and Wool NZ, Phil O'Reilly of Business NZ and Henry van der Heyden of Fonterra.