Labour investment policy

Press, 25 November 1982, Page 5

Labour investment policy

PA Wellington Labour’s Deputy Leader, Mr Lange, outlined an investment strategy which he pledged his party would have as a “central priority” when it next became the government. Mr Lange said more investment was essential for full employment; it would relieve the Government’s budgetary pressure, and help growth in company and private incomes. In an address to the Western Hutt Rotary Club, Mr Lange said that Labour’s strategy would gtiide public and private money “into channels which all sections of the nation have come to

appreciate lead not into backwaters but into a rapidly gathering growth stream.” Many of the economy's most promising areas of advance lent themselves to small-scale and mediumscale enterprises, said Mr Lange. He gave as examples tourism, horticulture, fisheries, and manufacturing that depended on the quality of the product “rather than economies of scale or masses, of cheap labour." There would always be some large-scale projects worthy of support, but the investment strategy had to be aimed at areas of high growth potential where New Zealand had a clear com-

pa’rative advantage. “This will require positive planning in the key economic sectors, involving the cooperation of government departments and trade unions,” said Mr Lange. “We do not need a State agency that seems to specialise in telling industries which parts are to be closed and how many workers are going to be made redundant. “The accent must be on the positive,” he said. Mr Lange said that more capital would be needed to spur investment, and until the savings ratio could be raised in New Zealand, that capital would have to be borrowed offshore.

It would then be allocated through, the Rural Bank and Development Finance Corporation “working with a set of specified criteria.” They would be: ® How many jobs were created for each million dollars invested. ® Export earnings for each million dollars invested. ® Contribution to economic growth for each million dollars invested, to government revenue, and to regional development. ® Use of New Zealand resources. More investment would mean a growth in private and personal incomes, he said, which meant that the government could gradually

lower tax rates without raising deficits and. adding to inflationary pressures. .