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Source: New Zealand Parliament – Hansard

Question No. 2—Prime Minister

2. Hon SIMON BRIDGES (Leader of the Opposition) to the Prime Minister: Does she stand by all her Government’s statements and actions?

Rt Hon JACINDA ARDERN (Prime Minister): Yes, particularly the Government’s work to prevent and respond to COVID-19, whether it’s the work that Minister Little is doing, for instance, on issues around commercial lease arrangements or our announcement today from Minister Faafoi which saw a $15 million investment in rural network capacity that will help lift the development and wellbeing of isolated communities as New Zealand’s economy begins its recovery from COVID-19. As I said yesterday, we need to continue our collective approach in all areas to make sure we stay safe and we save lives, but also livelihoods.

Hon Simon Bridges: Will we come out of level 3 in a fortnight so tens of thousands more New Zealanders can get working again?

Rt Hon JACINDA ARDERN: I can assure the member I am as eager as he is to see us return to normality as soon as possible. But what I’m also eager to do is make sure that we do not come out and then find ourselves yo-yoing back into restrictive measures at levels 3 and 4 again. That would be damaging for New Zealand’s economy; it would be damaging for New Zealand’s health. What we want to do is be considered, be clear, and be confident. No one wants a second wave.

Hon Simon Bridges: Why is it that so many tens of thousands of workers can’t work under level 3 when they can demonstrate that they can do it safely?

Rt Hon JACINDA ARDERN: What we had to, of course, consider—with the advice that we received from the Ministry of Health, from epidemiologists, from the technical advisory group—were measures that would make sure that in the short space of time we’re in this waiting recovery room, we can assess whether or not we’ve stamped out all of the embers of COVID-19. Now, until we have that assurance, we have to make sure we still limit people’s contact as much as possible. We found balance. We wanted people to engage in retail, so we’ve asked that people do it without contact with each other, because if we find those embers of COVID are still present—the last thing we would want is for someone, for instance, to have gone back into opening up their shop, have had hundreds of customers coming through and contact with them, and then we have an exponential spread of COVID once more.

Hon Simon Bridges: Does she think the 7,000 Kiwis going on job seeker support—or the dole—a week has peaked yet?

Rt Hon JACINDA ARDERN: I’m loath to make any predictions over what will happen with those accessing our benefit system presently. What I will say is that we have been very focused on trying to prevent that. The wage subsidy, which has cost collectively over $10 billion to date, has kept over a million Kiwis connected to their employer and to their work, and that is our goal. With those who are coming on to job seeker support, you will have seen yesterday the Minister for Social Development launching an initiative focused on connecting employers and a potential workforce to try and get them into work as soon as possible. Despite the COVID environment, we still have job vacancies. In fact, I shared the example yesterday of those who have come from tourism moving into food production and processing. We now have some industries that previously relied on migrant labour with a much higher rate of domestic labour in those jobs. We need to keep up that job placement, and that is what we’re focused on.

Hon Simon Bridges: What does she estimate new unemployment growth weekly will peak at, and when?

Rt Hon JACINDA ARDERN: We have no such estimates. What we have had is Treasury running a range of scenarios for—and this wasn’t specific to the drawing down of job seeker, but their scenarios talked about levels of unemployment. They range anywhere between 8.5 percent and well over that. That was the lowest rate they predicted. But, of course, all of that is variable depending on how long we’ll stay in restricted measures and also how much investment the Government makes. And that is why we have invested.

Hon Simon Bridges: What, then, do those scenarios tell us about what unemployment will hit when the 12-week wage subsidy ends?

Rt Hon JACINDA ARDERN: Actually, what it tells us is that we would do well to focus on getting out and staying out of restrictive measures, because that’s one of the significant variables. The second is the amount of investment coming in from Government, but I wouldn’t limit that just to a wage subsidy. I think what we’re all aware of is making sure that, yes, we keep people connected to their employer and to work. But also there will be some sectors that are gravely affected on an ongoing basis, so we will need ongoing, specific, and specially designed responses for those scenarios.

Hon Simon Bridges: Does she accept that by staying at level 3 without the provision of more business support than is currently being provided, many tens of thousands more businesses than would otherwise be the case will go out of business, resulting in tens of thousands more on job seeker support?

Rt Hon JACINDA ARDERN: As the member I’m sure will agree, we have acted quickly in being responsive to what we are seeing and hearing in real time from our small businesses in particular, but also the business community. And that is why, of course, we moved so quickly on the wage subsidy. It’s why we’ve moved quickly on the two tax packages we’ve already put in place, which are multi-billion dollar packages. And it’s also why even, for instance, today we’ve announced, even before final decisions have been made, Cabinet’s intention to work up further options to embed our view that the burden for those in commercial leases needs to be, as much as possible, more evenly shared, and that’s something that Minister Little is working on. And we’ve flagged that even before that work has concluded.

Hon Simon Bridges: Isn’t it better to keep a business in business and its workers in work with Government business support now than to see the business go to the wall and the workers go on the dole and Government trying after the event to come up with new jobs?

Rt Hon JACINDA ARDERN: That’s exactly why we have the wage subsidy.

Hon Simon Bridges: Does she accept we’ve had one of the strictest lockdowns, on the one hand, in the world but the lowest levels of Government business support, again, in the world, and what is she going to do about that?


Hon Simon Bridges: Why isn’t the Government providing more business support now whether for rents or rates or other business costs?

Rt Hon JACINDA ARDERN: Again, I wouldn’t trivialise the over $10 billion that has already gone into the wage subsidy. I equally wouldn’t trivialise the support and guarantee that we’ve provided through the business finance guarantee. I also point to the significant support provided through the two business tax packages—in total, over $5 billion worth of investment and support provided through those. And as I’ve already said, we continue to work to be as responsive as we can to the different needs we’re seeing arise, and that includes the forward signalling I’ve given today on the extra work we’re doing on commercial leases.

Hon Simon Bridges: Does she understand that waiting until Budget 2020 on 14 May will be too late for many tens of thousands of businesses and many tens of thousands of workers?

Rt Hon JACINDA ARDERN: I notice the member in the House referring to Budget 2020 as a milestone for business support. I would like to correct him, based on the evidence that we have rolled out packages all the way through to respond to need. It hasn’t been a matter of waiting for Budget 2020. We will continue to announce initiatives to support businesses now.

Hon Simon Bridges: Only because we’re pushing you to.

Rt Hon JACINDA ARDERN: And regardless of what the member may believe, we’re doing it based on what we hear, what we see, and what we know.