Finding common ground

In week two of my return to Telecom I found myself in front of the Finance and Expenditure select committee, talking to them about tax. The Hon. David Cunliffe said, “Ah Mr Chivers… poacher, turned gamekeeper, turned poacher, turned gamekeeper, turned poacher. Which are you today?” My response was that it really didn’t matter as long as you had the biggest gun. The poacher/gamekeeper model is by far the most common description of the dynamic between industry and government. Of course, it is a matter of interpretation as to who is doing the poaching and who is doing the defending! I personally don’t make the distinction, and I think the characterisation of the government/ industry dynamic as a continuous game of cat-and-mouse is anachronistic. While there is always an element of contest, it makes far more sense for government and industry to adopt a mindset focused on discovering that 80% of territory where there is alignment, and leveraging that common ground for New Zealand’s long-term benefit. So for me, when I was working for government implementing radical change to the telecommunications regulatory environment, and now that I am in Telecom working through the further radical change that is the ultra-fast broadband initiative, my underlying personal objective has been the same: to build and rebuild a strong and enduring relationship with the other party, for mutual benefit. In other words, I see government and Telecom as being important to each other. Both are interested in the long-term success of NZ Inc, and have their futures inextricably linked to the fortunes of each other. That doesn’t mean we always see eye-to-eye, as the optimisation of our short-term interests is often driven by very different considerations. But in it’s just not possible to separate the long-term interest of a national infrastructure player and the long-term interests of NZ, and that’s about a lot more than just what is happening in the telecommunications sector. New Zealand investors, like many around the world, have had their investment confidence rocked by a global financial crisis. The most obvious impact has the been the widespread collapse of finance and property companies which seem to have been a refuge for private money after the 1987 crash and dot.com bust shook our confidence in stockmarkets. So where do they turn now that the mattress under the bed is starting to look like the safest option? The Capital Markets Development taskforce has done some good work looking at what we can do to shore up investment confidence and expand investment options across a wide range of fronts. It is also pleasing to see that the government has responded with the inevitable strengthening of regulatory oversight for financial markets. Another key step is providing more opportunity for investments in large enterprises that span the scale from the patient-return/modest-risk end of the scale upwards. This lack of opportunity makes offshore investments more attractive, at a time when we need to provide more opportunities to invest locally. Providing NZ’s mums and dads an opportunity to invest in public infrastructure is worth looking at, at a time when such opportunities are few and far between. NZ also has a strong interest in attracting international investment at a time when global markets continue to be uncertain and unstable. We can do better simply by being more certain and more stable than the rest of the world, and by providing quality opportunities to invest. Setting up shop here has got to look better than anywhere else. Amongst other things, this requires a commitment to long-term policy stability in key areas that affect investment, including regulatory regimes, taxation, and national infrastructure. Investors love opportunity, certainty and stability. There is no doubt we can do better in all three areas.