Cabinet yesterday approved the development of a Business Continuity Package to help support the economy through the disruption caused by Covid-19.
“New Zealand is well-placed to respond to Covid-19. We have been running surpluses and our net debt position at 19.5 per cent of GDP is well below what we inherited, and well below other countries,” Finance Minister Grant Robertson says.
“We’ve also got ahead of this, through the $12 billion New Zealand Upgrade Programme of road, rail, health and school infrastructure investment around the country.
“Government Ministers have been in regular contact with businesses and industry groups as we work together to respond to the impacts of Covid-19. We have already taken action to support businesses and workers, and we are now in a position to announce the next steps in response to this rapidly changing situation.”
The Business Continuity Package includes:
· a targeted wage subsidy scheme for workers in the most adversely affected sectors.
· training and re-deployment options for affected employees; and
· working with banks on the potential for future working capital support for companies that face temporary credit constraints;
As part of the package:
· The Treasury and IRD have been directed to develop tax policy options in line with the goal of reducing the impact for affected businesses, to support businesses to maintain operational continuity.
· The Treasury and MSD have been directed to develop policy options to support households to maintain incomes and labour market attachment.
The detail of this package is now being worked through. It will be discussed again at the Cabinet Covid-19 committee on Wednesday, and the Government expects to be in a position to make further detailed announcements next week.
At all stages, says Robertson, the Government will be engaging with business groups and industry representatives, to make sure the Business Continuity Package meets their targeted needs.
He will be making a speech on Thursday at a Wellington Chamber of Commerce event, expanding on the Government’s approach.
However National’s Finance spokesperson Paul Goldsmith believes more urgency is required from the Government with respect to a relief package for businesses affected by coronavirus,
“The announcement (yesterday) that the Government is thinking about a business continuity package and expects to make decisions next week is startlingly flat footed.
“The Government say they’re trying to get ahead of this but they’re getting bogged down by detail.
“Affected businesses are struggling and need tangible support now. They now have to wait another week before they see any sort of relief package.
“Businesses need certainty and relief in the short term followed by broader economy-wide changes, like tax relief, so the economy can quickly bounce back from the downturn.”