Written by Grant Robertson, Minister of Finance.
OPINION: This week, I set out the next steps in our plan to respond, recover and rebuild from this pandemic, with Budget 2020.
It’s fair to say this year’s Budget was far from businesses as usual.
COVID-19 presents challenges not seen since the Great Depression. There’s no escaping that New Zealand, along with many other countries, is feeling the impact.
Going hard and early with a strong health response now means we’re in a place to begin rebooting economic activity and get things moving. We’re bringing the same discipline and focus to the economic rebuild as we did to the health response - and this week’s Budget is a key part of this.
From the very beginning, our Government has taken decisive action to keep people in work and save incomes and businesses. We’ve introduced tax and loan measures for small- and medium-sized businesses, and supported over 1.75 million people with our Wage Subsidy Scheme. These were just some of the measures we put in place immediately to help cushion the economic blow for New Zealanders and New Zealand businesses.
To get our economy humming, our focus needs to be on jobs. Budget 2020 is about just that: creating new jobs; training people to have the skills they need for the jobs we have; and helping people keep their jobs or get into new ones. We’re doing this while strengthening our local communities and regions, and getting the books back in the black.
The Budget’s $50b COVID Response and Recovery Fund covers an extension of the wage subsidy, free apprenticeships and trade training, a state house building programme, and offers further support for businesses to grow. It also includes an extension of the Lunches in Schools programme to a further 200,000 kids, and programmes to create environmental jobs and support tourism operators to locally redeploy staff.
With this Budget, projections show it’s possible for unemployment to be back at current levels in just two years - and our economy will be growing again as early as next year. The impact of COVID-19 on the government’s books will be significant, but we are coming from a strong starting position. Our debt is far lower than other countries and our balance sheet is strong.
I also want to be clear there will be further support for the recovery and rebuild after Budget Day. We will keep working to help New Zealanders get through and rebuild together.
I know that what we have asked New Zealanders to do in this crisis is huge, and the coming months and years will continue to be some of the most challenging we have faced in a very long time. But with our plan, and with the help of innovative and resilient businesses around the country, I am confident we can rebuild our economy together.
Grant Robertson, Minister of Finance.