Productivity Unleashed

The Policy: TOP Productivity Unleashed — September 2023 →

Pitched as a generational fix for New Zealand's chronic underperformance, the Opportunity Party's *Productivity Unleashed* policy package aims to redirect investment away from property speculation and toward business, innovation, and competition — so that the next generation of Xero or Rocket Lab success stories has fertile ground to grow.

What it does

New Zealand's productivity problem is well-documented and severe. GDP per hour worked is now roughly 40 percent below the top half of OECD peers, and the gap has widened from 34 percent in 1996. Economist Cameron Bagrie (Bagrie Economics) notes that productivity growth averaged just 0.2 percent a year over the last decade, against 1.4 percent in the two preceding decades — "an economy in serious structural trouble." Against that backdrop, *Productivity Unleashed* proposes five interlocking levers:

• Redirect capital from land to business. A Land Value Tax (LVT) of 1.75 percent on urban land and 0.5 percent on rural land — with deferrals for land-rich, cash-poor owners such as farmers and retirees — is designed to make holding idle land costly and channel investment into productive enterprise. The LVT is projected to raise approximately $24 billion annually and is expected to push residential land prices down 10–15 percent over the transition period.
• Build a domestic capital pool. KiwiSaver 2.0 would phase total contributions to 12 percent of gross earnings (6 percent employer, 6 percent employee) over eight years, accumulating what the party calls "a trillion-dollar capital pool available for national development." The OECD's May 2026 New Zealand Economic Survey underlines the need: business loans are just 18 percent of total lending in New Zealand against 30 percent in Australia, and SME lending spreads are high — a structural drag on productive investment.
• Lift R&D to at least 2 percent of GDP. The party proposes enhanced R&D tax credits and science funding to reach that threshold. Total R&D hit 1.54 percent of GDP in 2024 — a record high yet still well below the OECD average — and the business-sector share alone slipped from 0.98 to 0.95 percent of GDP in 2025, underscoring the gap. Notably, the Government scrapped its 2 percent R&D target in April 2025, the very benchmark Opportunity is now reviving.
• Open emerging sectors. The policy proposes to properly regulate the cannabis and gene-technology sectors for safe business innovation, and to establish a "gold-standard" AI regulatory framework — positioning New Zealand as a destination for innovators currently hamstrung by legal uncertainty. Both cannabis and gene-technology frameworks remain contested under the current coalition government.
• Sharpen market competition. The policy targets monopolistic sectors — supermarkets, banks, and building-material suppliers — by strengthening the Commerce Act and boosting Commerce Commission funding. The Commission's June 2026 State of Grocery Competition report found the two major chains still hold over 80 percent of national retail grocery volume, with Grocery Commissioner Pierre van Heerden noting "regulatory changes are starting to bed in" — but acknowledging no meaningful shift in competitive outcomes yet.

The package also proposes forgiving student loan interest to retain skilled workers, and liberalising migration rules for high-wage, in-demand professionals — treating brain drain and skills shortages as direct productivity constraints.

The result

Whether the package delivers depends almost entirely on whether Opportunity enters Parliament. The party received 2.22 percent of the party vote in 2023 and has never crossed the 5 percent threshold. By June 2026, a 1News Verian poll showed the party at 4.6 percent — its highest reading at a comparable point in any previous cycle — but still 0.4 points short of guaranteed representation.

The internal logic of the package draws support from mainstream economics. Shamubeel Eaqub (Simplicity chief economist) has described a land value tax as "the cleanest, most fair, efficient kind of tax we can use", though he cautioned any change must be "politically enduring through economic and political cycles." Cameron Bagrie has argued that "the days of selling more expensive houses to each other are done" and pointed to the need for capital to flow into the productive economy rather than property.

Critics are pointed. National leader Christopher Luxon dismissed Opportunity as "a vote for Labour and the Greens" and characterised the Citizens' Income component as making every New Zealander a beneficiary. Dean Anderson, founder of Kernel, opposed compulsory contributions: "If you're on a low income, dollars in hand matters most...Losing 10–12% KiwiSaver is a nice-to-have, but not practical." NZ First leader Winston Peters dismissed the party as "a party of consultants" whose promises sound good "until the invoices come in." An independent analysis (Good Ideas NZ) flagged a mathematical gap in the Citizens' Income costing: the stated $62.8 billion cost implies approximately 3.2 million recipients, yet Statistics NZ records 4.1 million adults resident in New Zealand — leaving around 900,000 adults unaccounted for in the published figures.

Leader Qiulae Wong's response to the wasted-vote concern is direct: "For every person that I meet that says they voted for us, I probably meet three or four that say: 'I really loved you guys… but I chickened out and voted for someone else.'"

The impacts to watch

• Capital reallocation speed. A 1.75 percent Land Value Tax could shift investment away from property over years, not months. Economists note transition risks for land-rich, cash-poor households including farmers and long-term owner-occupiers — risks the party tries to address through deferral provisions.
• Commerce Commission capacity. Boosting ComCom funding is operationally achievable, but the 2026 grocery report illustrates that regulatory tools without structural remedies have limited bite. Competition in supermarkets remains weak years after the 2022 market study.
• Emerging-sector regulation. Cannabis and gene-technology frameworks are both still evolving under the current Government. Opportunity's commitment to regulate-rather-than-prohibit represents a genuine fork, but its passage depends on coalition arithmetic.
• Threshold risk. The entire package is contingent on a party that has never entered Parliament crossing 5 percent or winning an electorate seat on 7 November 2026. If Opportunity falls short, its productivity agenda remains a platform rather than a policy.