Our initial response focused on cushioning the impact of the pandemic on Kiwis and Kiwi businesses, taking decisive action to protect jobs, incomes and businesses through measures such as the Wage Subsidy Scheme and interest-free loans for small businesses. Now, thanks to the success of our strong health response to the virus, we’re transitioning down Alert Levels, getting people back to work and starting to reboot the economy.
Although our early actions mean we’ve managed to cushion the blow for many New Zealanders, the global economic downturn will be felt here. Budget 2020 is about rebuilding together, to get business moving and the books back into the black. It’s an integral part of our COVID-19 economic response.
To get our economy moving, 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.
With this Budget, and its dedicated $50 billion COVID Response and Recovery Fund, projections show unemployment can be back at current levels in just two years, and our economy will be growing again as early as next year.
Budget 2020 also lays the groundwork of our third phase of recovery: rebuilding together. We have the opportunity to rebuild our economy better than it was before – the chance to craft an economy that addresses the long-term challenges we face as a country.
We’re confident in the ability of Kiwi businesses to succeed in the face of COVID-19. Historically they’ve proven to be innovative and resilient, and this Budget is tailored to enable their success.
This is not a business-as-usual Budget as these are not usual times. It’s an important early step in Labour’s phased plan to get things moving, and rebuild our economy together.
We will create jobs and grow the economy by backing Kiwi exporters, encouraging entrepreneurship, helping SMEs thrive, rebuilding tourism and protecting small businesses and consumers from unfair practices. We’re also providing targeted support for the construction, digital, and agritech sectors, and helping to develop the Māori economy by supporting strong iwi businesses.
What we’ve already done
We acted decisively in our economic response to COVID-19 with the $10.7 billion wage subsidy, $3 billion tax refund scheme, the Small Business Cashflow Loan Scheme and the Business Finance Guarantee. The Wage Subsidy Scheme has paid out more than $10.7 billion to support more than 1.7 million Kiwi workers.
We’re extending the Wage Subsidy Scheme
From June 10, qualifying businesses will be eligible for the extension of the Wage Subsidy Scheme. The subsidy will cover eight weeks and be paid as a lump sum to employers, at the same weekly rates as the current scheme.
We’re offering on-the-ground support for Kiwi exporters in key markets to boost trade
Doubling the number of exporters receiving Focus-level support from NZ Trade and Enterprise, to 1400, and utilising NZTE’s business development managers as ‘boots on the ground’ for New Zealand exporters in key markets. Strengthening New Zealand’s brand in priority markets, expanding the International Growth Fund, and scaling-up NZTE’s e-Commerce Centre of Excellence.
We’re encouraging entrepreneurship and innovation to kickstart growth
A $150 million fund to provide loans to R&D-intensive businesses, to complement the existing R&D tax credit.
We’re supporting small businesses to grow digitally via e-commerce
A $10 million fund to provide incentives and grants to encourage e-commerce, train more digital advisors and provide information and support for SMEs wanting to incorporate e-commerce.
We’re rebuilding tourism together
A $400 million targeted Tourism Recovery Fund, alongside the extension of the Wage Subsidy Scheme.
We’re protecting small businesses and consumers from unfair practices
A $30.4 million investment over the next three years (and $13.9 million per year thereafter) to help the Commerce Commission focus on the potential impacts of COVID-19 on competition and fairness in markets.
We’re providing targeted support for key sectors and helping develop the Māori economy
$41.4 million across three years into initiatives in the construction, digital and agritech sectors to help create higher-skilled jobs and make our economy more productive and sustainable. $6.5 million will go towards helping develop the Māori economy in sectors with strong iwi presence, such as forestry and food, and to support Māori engagement with opportunities in other sectors such as the digital economy.
We are looking out for the health, safety, and wellbeing of our communities with further support for children, families, community groups, and our most vulnerable.
What we’ve already done
We have been investing in our communities since our first day in office, strengthening our public services and fixing our rundown schools and hospitals. We introduced the Free and Healthy School Lunch Programme in 2019, because a full stomach makes all the difference to a child’s learning. Our 2019 Budget included a major investment in family and sexual violence support services. During the initial COVID-19 response, we announced further funding for NGOs and community groups that support those in need.
We’re making a record investment in hospitals and health services
A record investment in DHBs of an extra $3.92 billion ($980 million per year), a one-off boost of $282.5 million over three years for a planned care (including elective surgery) catch-up campaign following COVID-19 disruption, and ongoing funding of $31.350 million per annum ($125.4 million over four years) to manage planned care in line with demographic changes and increasing price levels.
We’re expanding our school lunch programme to feed 200,000 more children
The programme will start to expand to 200,000 more students from Term 4 this year, targeting students in schools with the highest disadvantage and now cover all years – from 1 to 13.
We’re giving a pay increase to Early Childhood Education teachers
A $151.1 million funding boost over four years for early learning services to improve the pay of up to 17,000 qualified teachers working in education and care services.
We’re supporting our social service providers
We’re boosting family violence services
$202.9 million to address family violence and sexual violence, in addition to the COVID Response and Recovery Fund. Funding for therapeutic services for children and young people exposed to family violence, and grants for 200 family violence service providers to increase their capacity to respond to an expected increase in need, due to COVID-19.
We’re helping community groups recover
We’re lifting support for New Zealanders with disabilities
The largest-ever funding boost for disability support services. Over $833 million to take budget pressure off disability support services, assess innovations that empower people with disabilities, and pay for in-between travel costs for disability carers.
We’re connecting food suppliers with Fruit in Schools
Funding to purchase primary produce and distribute it to those in need, scaling up Fruit in Schools over 10 weeks to deliver an additional 10,000 fruit and vegetable boxes to children, and to develop digital platforms to connect food with consumers.
We’re easing the impact on rural and fishing communities
$20 million to increase the scale and reach of support to rural and fishing communities, including Māori communities, and improving access to support and mental wellbeing services, and financial advice, for primary sector businesses.
We’re getting people into work with almost 11,000 new environmental jobs in our regions. From upgrading walking tracks, to wetland restoration, to pest eradication, these local jobs will help protect our environment and clean up waterways, while boosting regional economies and getting people into work.
What we’ve already done
Protecting our environment and cleaning up our waterways has been a major focus of our Government since the beginning. We’ve passed the landmark Zero Carbon Act, phased out single-use plastic bags, and worked with farmers to clean up our lakes and rivers - and that’s only to name a few. With Budget 2020, we’re creating jobs in our regions to help recover from COVID-19, and continuing to protect our environment: it’s a win-win.
We’re creating regional jobs through new environmental projects
$433 million over five years to fund jobs in regional environmental projects such as restoring mini wetlands, stabilising river banks and removing sediment. This will include work to restore the Kaipara catchment.
We’re backing weed and pest control
A $315 million package for pest eradication and management, including ramping up the Department of Conservation’s pest control programme, advancing Predator Free New Zealand, working with iwi to prevent the collapse of North Island forests, getting populations of wallabies under control, undertaking pest and weed control on Crown Land, and helping control wilding pines.
We’re creating new environmental jobs with the Jobs for Nature fund
A new $200 million fund to create nature-based jobs. DoC will work with councils, iwi and local businesses – including tourism operators – to employ thousands of people across New Zealand.
We’re creating more than 1800 new biodiversity jobs
New jobs, located primarily in the regions, where workers will protect and restore indigenous biodiversity and habitat, help with revegetation of private and public conservation land and undertake riparian planting.
We’re working with the construction sector to accelerate the public housing build programme, boosting the apprenticeships scheme to enable people upskill and retrain, and partnering with industry to identify and fill skills gaps in the workforce.
What we’ve already done
Since our first day in office, we’ve been working to address construction skills shortages and train the workforce of the future. We’ve also increased the public housing build programme, and put in place a $300 million Homelessness Action Plan.
We’re getting people trained in the trades
$1.6 billion Trades and Apprenticeships Training Package to provide opportunities for New Zealanders of all ages to receive trades training, including support for free trades training in critical industries, funding for employers to retain and keep training their apprentices, and support for Māori trades training.
We’re building an extra 8,000 new, warm, dry public and transitional houses
$570 million to build an extra 8,000 homes, split between approximately 6,000 public housing homes and 2,000 transitional homes, to support the residential construction sector and create jobs. We’re also expanding the Warmer Kiwi Homes insulation and heating programme, which will employ contractors and support jobs up the supply chain.
We’re helping young people at risk of long-term unemployment get training, get jobs, and stay in jobs
An expansion of He Poutama Rangatahi, a programme supporting 15-24 year olds not in education, unemployment or training, who are at risk of long-term unemployment. This expansion will allow the programme to gain sustainable footing in the regions and speed up its establishment in urban areas like West and South Auckland, Hamilton, Porirua, and East Christchurch.
We’re supporting Māori trades training
A $50 million fund to partner Māori community groups with the Crown to support Māori employers to take on Māori apprentices.
We’re transforming the primary sector workforce
$19.3 million over four years to help thousands of recently unemployed New Zealanders access training and work opportunities in the primary sector. This aims to place at least 10,000 people in primary sector jobs in the immediate term, supporting growth of the primary industries in the longer term.
Read the Budget 2020 press releases