Next steps of Govt and business COVID-19 responseFinance
This week the Government will roll out the next steps of its plans to support businesses and workers as part of New Zealand’s ongoing response to COVID-19.
These initiatives will be on top of the immediate measures already in place, including support for the tourism and fisheries industries, an increase in business support funding, and tax and income assistance through IRD and MSD.
“Ministers are actively considering a range of options in response to the impact of COVID-19, and Cabinet will discuss these tomorrow,” Finance Minister Grant Robertson said.
“We are taking the necessary steps to best protect the New Zealand economy from the global economic disruption caused by COVID-19 and to position us to successfully come out the other side of it.
“We’re in regular contact with business, unions and affected industries about how COVID-19 is affecting cashflow. We’re taking a calm and measured approach to this unfolding situation and working alongside affected communities as we respond.
“We have already taken steps to implement the immediate measures suggested by Business New Zealand and the CTU at our meeting with them last week, including the request that Government departments and agencies pay their bills within 10 days.
“The sense I’ve got from industry is there is an understanding that this situation – an export shock with domestic flow-on impacts – is different to others the economy has experienced in recent years.
“That means a tailor-made response is required. Industry representatives are telling us they are seeing different effects on different industries in different regions. A one-size-fits-all approach is not what is needed.
“The Government is in a strong position to invest and support the economy. We’ve been running surpluses, and our net debt position at 19.5% of GDP is well below other countries and what we inherited. The $12 billion New Zealand Upgrade Programme will also stimulate the economy as we boost investment in road, rail, hospital and school infrastructure.”
On Monday, Grant Robertson is meeting with the CEOs of New Zealand’s major banks, to discuss the work they are doing to support their business and personal customers.
“It’s important that New Zealand works as one to respond to this rapidly changing situation. Our meeting is an opportunity to discuss the range of measures banks are taking, as well as discussing the Government’s targeted action.”
Last week, the Ministers of Finance and Revenue met with the Prime Minister’s Business Advisory Council, the Tourism Industry Association and Xero to discuss the situation.
Grant Robertson also met with the Secretary of the Treasury and the Reserve Bank Governor to discuss macro-economic impacts as a result of the coronavirus.
“We’re taking the time now to work with industries to plan for how we kick-start activity again as we exit out the other side of COVID-19. What we do know is that this will pass.”
The Finance Minister will also deliver a speech on Thursday to the Wellington Chamber of Commerce Business Summit where further updates on the Government’s economic response will be provided.
Note to editors: The Government is already taking the following actions:
- Continuing to work closely with banks to ensure they are being proactive with their clients
- Improving cashflow for small businesses by signalling action on prompt payment terms and times
- Inland Revenue is entering into instalment arrangements and waiving penalties on a case by case basis where individuals and businesses have had their income and cashflow affected
- An extra $4 million invested in the Regional Business Partner Programme to allow for extra advisors and give them more time on the ground supporting businesses
- Working with Xero to get real-time information about the impacts on business, particularly SMEs.
If your income has been affected please get in touch with Inland Revenue and work through your circumstances, or seek out the dedicated COVID-19 resource on the MBIE website business.govt.nz.
Many small business owners are already talking to Inland Revenue about tax instalment arrangements to avoid penalties and interest accruing on their account while they gain a better understanding of their cashflow during this difficult time.
Others are seeking advice about how to deal with questions about COVID-19 from staff in the workplace, and how to prepare and respond if someone has to take sick leave.