Labour has pledged to direct 15 percent of government contracts to small businesses and start-ups, as part of a small business policy package announced on 9 August 2026. The package also promises faster invoice payments, lower administrative costs, and a scaled-back version of the coalition government's Investment Boost policy aimed only at small businesses.

Labour finance and economy spokesperson Barbara Edmonds said the government buys roughly $50 billion of goods and services each year. She framed the procurement target — a set share of contracts reserved for a specific group — as a way to steer a meaningful portion of that spending toward smaller operators who currently struggle to compete for government work. The party would also break up larger government contracts into smaller jobs to make them easier to bid for, according to RNZ.

The package, branded Labour's "Small Business Action Plan," would help small businesses get paid sooner, invest more easily, and spend less time on paperwork, according to the party's policy document published 6 August. Labour Party An Instagram announcement two days later promoted the same measures.

Labour also proposed a New Zealand Business Number system — a single identifier a business could use across all government agencies instead of registering separately with each one. The party said this would reduce duplicated paperwork across the board.

Revenue spokesperson Deborah Russell said Labour would review tax administration, including provisional tax (a system where businesses pay tax in instalments before year-end based on estimated income), filing requirements, and the January and February deadline pile-ups that create cash-flow and compliance pressure for small firms. RNZ

On the Investment Boost policy, Labour said it would keep the coalition government's mechanism but narrow its scope, targeting it to small businesses only rather than the broader application under the current government. RNZ reported the plan on 6 August. RNZ

The procurement target draws on a precedent already operating in the Māori business space. The government's procurement target for Māori businesses was initially set at five percent of contracts and rose to six percent in 2022 due to demand, according to a Labour Party release from September 2024. Labour Party Labour's proposed 15 percent small business target would sit alongside, not replace, that existing Māori procurement target.

Labour leader Chris Hipkins flagged procurement difficulties in an August 2024 speech to Local Government New Zealand, citing figures showing 57 percent of construction businesses were reporting difficulties with procurement and work consent conditions, up from 36 percent the previous year. Labour Party

The broader context here is that Labour is building a case that the current procurement system is structurally weighted against small operators. The $50 billion annual government spend Edmonds cited is the anchor: if even a fraction of that is currently concentrated among large providers, a 15 percent small business target would shift a material share of contract flow. The Māori procurement target precedent, which rose from five to six percent on demand, suggests the mechanism can be adjusted once up and running, though Labour has not said whether the 15 percent figure would be phased in or introduced all at once.

The tax administration review Russell outlined targets a known friction point. Provisional tax and the clustering of filing deadlines in January and February have been recurring complaints from small business and tax practitioner bodies. Labour's framing of a New Zealand Business Number as a single identifier across agencies is a structural fix to duplication, though the party has not yet detailed which agencies would be brought in first or what the implementation timeline would look like.

Narrowing Investment Boost to small businesses only is a departure from the coalition government's broader application. Labour has not specified the eligibility thresholds it would use to define "small business" for either the Investment Boost or the procurement target, which will be a detail the business community and the Treasury will press for.

All of these measures are election commitments and would need legislative or regulatory action to take effect. The procurement target would likely need to work through the Government Procurement Rules administered by the Ministry of Business, Innovation and Employment. The New Zealand Business Number proposal would require cross-agency data-sharing agreements and system integration.