2014

A longer parliamentary term and fewer members of Parliament are two key changes that New Zealand business owners would like to see, according to the Grant Thornton International Business Report (IBR).

The survey showed that 70% of participants wanted the parliamentary term increased to four years and 60% would like to see the number of MPs or seats in Parliament reduced. Fifteen per cent wanted the parliamentary term extended to five years.

Greg Thompson, Partner and National Director, Tax at Grant Thornton New Zealand, said that the desire to have a longer parliamentary term recognises the maturity of the New Zealand political system since the introduction of MMP.

“MMP, compared with the old first-past-the-post system, gives a much wider representation in parliament which in turn takes longer for decisions to get through the system.

“Just look at the Government’s assets sales programme where it wasn’t possible to implement the entire programme in one election cycle. This disjointedness then flowed on to the capital markets with a loss of general cohesion in the New Zealand economy.”

The survey also showed that 38% thought that MMP was the best scenario while 32% thought it should be abolished.

“It is becoming very obvious that with MMP and multiple parties there is always the ongoing need to ‘do a deal’ which takes time.

“For the business owner, this deal making slows down political processes which hinders their own decision making. What a business owner wants is clarity and stability upon which they can plan. The present electoral system and term does not deliver those two requirements.

“While there is a general acceptance of MMP, the fact that 60% of the respondents want the number of MPs or seats in Parliament reduced indicates a belief that ‘too many cooks’ are slowing down the parliamentary process. They prefer quality to quantity,” he said.

In comparison with New Zealand’s three-year term, the United States and the United Kingdom have four and five year election cycles respectively.  New Zealand is one of the few countries in the world to retain a three-year cycle.

Further enquiries, please contact:

Greg Thompson
Grant Thornton New Zealand Partner and National Director, Tax
T + 64 (0) 212817332
E greg.thompson@nz.gt.com