Waikato regional economic profile - Waikato Regional Council

7 Institutions7.1 SummaryCentral and local government institutions are part of the fundamental framework of theregional business environment. They set the rules of the game through regulation andcan contribute overtly to growth through active support for firms and sectors. TheTreasury notes that regulation can be used to pursue economic, social andenvironmental goals from which the community derives benefit. High quality regulationis important for productivity and economic growth. The challenge is to ensure thatregulations deliver their objectives at least economic cost, thereby contributing themaximum net benefit to society. 342 It might be expected that, in the longer run, regionsthat invest significant amounts in economic development should benefit from highergrowth, provided that expenditure is appropriately allocated. 343Although New Zealand is considered one of the easiest countries in the world to dobusiness, the authors of this economic profile did not find any publications reviewingthe cost, interpretation or application of central or local government regulation inWaikato, including its consistency across territorial authorities. At the time of publishingthis economic profile, work was being undertaken by councils through the WaikatoLocal Government Forum to contribute to a better understanding of this.Research for Local Government New Zealand by Business and Economic ResearchLtd suggests that local government makes a broad contribution to economic growth.Many of the region’s territorial authorities support business development, through bothstrategy for their areas and the delivery of services.7.2 NationalCentral government is responsible for setting economic policy through departmentssuch as the Ministry of Business, innovation and Employment, managing publicfinances through the Treasury and Inland Revenue Department and managingmonetary policy and money supply through the Reserve Bank.The World Bank’s Doing Business 2012 report ranked New Zealand third in the worldfor ease of doing business, first for ease of starting a business and first in the world forprotecting investors. 344 The 2011 Index of Economic Freedom, compiled by TheHeritage Foundation and the Wall Street Journal, ranked New Zealand as the fourthfreest economy in the world and as number one for business freedom. 345New Zealand was the first developed country to enter into a free trade agreement withthe People’s Republic of China. It also has free trade agreements with many othernations, including Singapore, Thailand, the Association of Southeast Asian Nations-Australia, and Malaysia. Australia and New Zealand have one of the most openeconomic and trade relationships between any two countries, effectively givingexporters duty-free access to 27 million people approximately.7.3 RegionalIn addition to WRC, the Waikato region has 11 territorial authorities (one city, Hamilton,and 10 districts), three of which lie across the regional boundary (Rotorua, Taupō andWaitomo districts).Regional councils are primarily concerned with environmental resource management,flood control, air and water quality, pest control, and in specific cases public transport,342The Treasury (2011a) Regulation.343New Zealand Institute of Economic Research (2004, p. 31).344World Bank Group (2011) Ranking of economies – doing business.345Heritage Foundation (2011) Top ten of 2011.Page 100 Doc #: 2069885