'Enterprise economy’ ideas revealed

Press, 26 February 1986, Page 21

'Enterprise economy’ ideas revealed

PA Wellington Growing dependence on the State would diminish in what the Opposition spokesman on finance, Mr Michael Cox, has labelled his “enterprise economy.” An enterprise economy would demand accountability for State spending and employ the best management techniques, said Mr Cox, explaining the term to Federated Farmers in Palmerston North.

“Cox enterprise economy policies” were neither “Left wing, Right wing, Keynesian, Friedmanite nor Rogernomics” but the essence of the New Zealand free enterprise economy.

Policies would be based on innovative New Zealanders knowing better how to spend their own dollars and preferring to do their own things, rather than having the “octopus of the State” meddling.

Mr Cox said that over the last 10 years, Govern-

ment spending had risen from less than 30 per cent to nearly 40 per cent of gross domestic product.

That increase had come mainly in social services, industrial development and debt servicing. In spite of the protestations of the Minister of Finance, Mr Douglas, Government expenditure was in deep trouble, said Mr Cox.

The State wage bill for the next year looked likely to rise as much as $l2OO million, making a deficit of $3OOO million likely in the next financial year.

The Government had also made a huge alarming shift of resources into social welfare.

“This is socialist philosophy and is not hidden by true socialists when they say they see the means that Roger Douglas is applying to the economy as a method of redistributing wealth and shifting resources into the State sector.”

Mr Cox said an enterprise economy would remove the monopoly in the labour market caused by compulsory unionism and would have a taxation system that was simple to run.

While saying that system would be fair to all and would build in rewards for investors and risk takers, Mr Cox did not elaborate.

Discussing privatisation, he said the term asked the fundamental question about whether the State should be involved in the marketplace.

“The State’s role starts where the private sector’s ends — that is where price signals are lacking and there’s a market failure to get a significant return on investment.”

Under an enterprise economy, privatisation was not for gathering extra dollars to fund Government deficits, but as a means of providing better prices and services, Mr Cox said.