Shortly after 14 October, the Kiwi votes will be in and a new government will be formed to lead the country through the next three years. Right now, though, politicians are vying for the hearts and minds of voters, with a range of policies related to tax, climate action and more.Many of these proposals may sound enticing, but how should we be evaluating them?

As chartered accountants, we’re used to applying a professional scepticism lens. The New Zealand advocacy team at Chartered Accountants Australia and New Zealand also considers how any government policy measures up against five guiding principles that ensure a policy is in the public and members’ interest: fairness, efficiency, transparency, certainty and prosperity.

The essentials

Our expectation is that any policy should:

• Focus on the long term
• Propose solutions that address key challenges for the country such as inequality, productivity, inter-generational equity, climate change and prosperity
• Be fully costed, so that voters can identify the trade-offs inherent in the parties’ prioritisations
• Not be a short-term, ad hoc, politically driven election bribe.

One of the structural challenges is the current three-year parliamentary term. A new government has a year to get settled in and turn its policy ideas into draft legislation, a second year to enact legislation and implement new policies, and then it finds itself back in an election year, when policy development and implementation slow to a halt. For that reason, we can see the benefits of changing to a four-year parliamentary term to deliver greater certainty, efficiency and prosperity. Despite this limitation, there are three policy areas we would like to see prioritised.

Action on climate change and sustainability

With climate change comes profound consequences, including effects on production, financial stability, living standards and employment. A transition to a zero-emissions economy requires long-term policies that provide certainty for business and encourage investment. CA ANZ is a strong advocate for a set of robust, global sustainability disclosure standards that are flexible and go beyond climate to encompass other topics such as nature and modern slavery.

The overarching goal should be to provide all stakeholders with a clear and accurate picture of an organisation’s ability to create value sustainably over time. Robust assurance of these disclosures will also be critical.

Fringe benefit tax

Fringe benefit tax (FBT) needs a major overhaul. The tax should be simplified and made fit for the future. Given that FBT delivers relatively little revenue for the government, CA ANZ favours a stripped-back version that focuses on in-kind remuneration (where the employee derives a material benefit) and that strikes the right balance between the revenue FBT delivers and the compliance burden it imposes on employers. The key function of FBT is as an anti-avoidance mechanism to ensure the integrity of PAYE.

CA ANZ supports Inland Revenue’s recommendation that a full policy project (including public consultation) be undertaken to re-establish the remuneration basis of FBT, modernise the tax and reduce compliance costs.

Education and financial literacy

According to the Organisation for Economic Co-operation and Development (OECD), New Zealand’s results in the Programme for International Student Assessment have declined steadily since 2000. In the most recent results, New Zealand ranked 12th in reading and science, and 27th in maths.

A robust National Certificate of Educational Achievement (NCEA) curriculum that sets up the next generations for success is critical not only for our rangatahi (young people) but also more broadly for our economy and society. We will continue to push for the curriculum to include financial literacy skills and for NCEA 1 Commerce to include a strong accounting component that is taught in a contemporary way.

Make it count

For now, we encourage our members to keep up to date with the various policy proposals put forward and consider them with a critical eye. Most importantly – have your say on election day.