Wednesday, 23 April 2008

Remove the Red Tape, the Fibre Optics will follow

Yes, National is right, we do need better broadband coverage in New Zealand, and yes they are right, Telecos are reluctant to upgrade the telecommunications infrastructure. However the solution is not more government intervention it is less ... way less.

We need to look at the reasons why private equity is not flowing into our infrastructure (telecommunications or otherwise). All business decisions ultimately boil down to risk. With infrastructure the main risk is political risk. There is a real fear amongst our business leaders that the government, with a stroke of a pen, will steal assets by nationalising them (in full or in part) or with another stroke tilting the playing field and vamoose, profit is gone. Taken by those that - on average - couldn't make a profitable decision to save themselves.

National just needs to do the following:
1) repeal the Resource Management Act. I know it's hard to admit when you are wrong, but this monster of red tape has morphed into an unholy mess of corruption and is strangling the very heartbeat of the New Zealand economy.

2) once they are in power, remove any legislation that doesn't provide a level playing field and swear that they will not pass any further legislation that restricts our businessmen and their activities.

3) show a strong commitment to private property rights - stop stealing from NZ businesses and from its citizens. Talk about it at every opportunity. Replace the word 'sustainability' with 'property rights'.

Do this and
entrepreneurs (Kiwi or otherwise) will have the confidence to invest and infrastructure concerns will be a thing of the past.

The complete lack of business nous is understandable if we were talking about Labour or the Greens, but the National Party? It's just plain unbelievable.