Business confidence sliding into winter of discontent

TL;DR: These are the six things that stood out to me in news and commentary on Aotearoa-NZ’s political economy at 10:06am on Wednesday, May 1:

1. The Lead: Business confidence fell across the board in April, falling in some areas to levels last seen during the lockdowns because of a collapse in construction activity after the new Government froze or reversed spending decisions on water, housing and transport investment. A drumbeat of state sector job losses and austerity rhetoric has further chilled retail spending and the housing market. ANZ Business Outlook survey

2. Two new polls confirm a sharp tightening of the Government’s lead over the Opposition, although not quite as dramatic as the 1News-Verian poll on Monday because they both saw NZ First staying above 5%. The Roy Morgan poll for April published last night showed the lead falling from 15.5 percentage points to 10 points, while the leaked results from Talbot Mills’ internal polling for Labour in April found the coalition’s six percentage point lead in March turned into a two point deficit to Labour/Green/Te Pāti Māori in April.

3. A day after polls showed a slump in support for the Government, Infrastructure, Housing and RMA Minister Chris Bishop has said he’ll consider ‘sensible’ and ‘constructive’ changes to the Fast-track approvals bill, which has unleashed a torrent of opposition from across the political spectrum. Bishop said one possible change was to give final decision rights to independent panels, rather than ministers.

4. Bus and train fares for teenagers rise sharply from today because of Government public transport funding cuts, adding to the inflation pressures generated by double-digit hikes in council rates, again because of Government funding freezes and cuts. The Government has also imposed road user charges for electric vehicle owners and has promised to reintroduce prescription fees, all of which are contributing to inflation pressure, keeping mortgage rates high for longer.

5. The Government abandoned the Residential Property Managers Bill introduced by Labour last year, despite support for it from REINZ, the Residential Property Managers Association and Auckland Property Investors Association. The bill also doesn’t cover privately managed rentals directly, only applying after a private manager violates tenancy laws more than twice. Bishop said the bill would add costs and not contribute to building more houses, while also distracting officials.

6. A Commerce Commission analysis of fuel prices released yesterday found areas that include at least one unstaffed fuel station within a five-minute drive have prices that are on average six cents per litre lower than those areas without unstaffed stations, although unstaffed stations run by supermarkets don’t have the same effect on competition.

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Govt spending freeze chills economy heading into winter