Fletcher call for investment allowance

Press, 20 August 1984, Page 30

Fletcher call for investment allowance

PA Auckland Fletcher Challenge is unlikely to proceed with several projects unless it received an investment allowance of about 20 per cent, Mr Hugh Fletcher has said. Discussing the Government’s plan to phase out the main export incentives by 1978, Mr Fletcher, the group managing director, said: “You have got to be talking about an investment allow-' ance around the 20 per cent level, or you are playing with it.” Without such an allowance, he said, it was less likely Fletcher Challenge would go ahead with such projects as a medium-den-sity fibreboard plant, expanded sawmilling and paper-making plants, and meat-cutting plants.

Mr Fletcher said much of that benefit had been lost in increased costs for freight, petrol, and other items. In any case, he said, New Zealand had not been investing enough in new plant and equipment before the devaluation. The president of the Auckland Manufacturers’ Association, Mr Doug Benefield, also advocated a 20 per cent investment allowance, in addition to faster depreciation of new equipment for tax purposes. The president of the Electrical Manufacturers’ Federation, Mr Graeme Fincher, said there would be an increase in unemployment unless export incentives were replaced by faster depreciation allowances and more finance for industrial expansion.