New Zealand’s government announced a spending package equivalent to 4% of GDP in an attempt to fight the effects of Covid-19 on the economy, in what ministers called the most significant peace-time economic plan in the country’s modern history.
It includes covering wages for people who are required to self-isolate but cannot work from home, or those caring for relatives who are sick with the virus, even if they are not sick or do not test positive for Covid-19.
“This package is one of the largest in the world on a per capita basis,” Grant Robertson, the finance minister, told reporters at New Zealand’s parliament on Tuesday.
A Covid-19 sick leave scheme has also been created and will be available for eight weeks at a cost of $126.5 million.
Some 27,000 workers every two weeks are expected to take advantage of this scheme.
Finance Minister Grant Robertson said the package is one of the largest in the world on a per capita basis. It is more than the total sum of new spending in all three of the last Budgets put together.
“The global economic impact of Covid-19 on New Zealand’s economy is going to be significant, so we are acting now to soften the impact.”
But Robertson is forecasting the Government to be in deficit for the foreseeable future and will have to borrow billions of dollars to fund the spending package.
“This is the rainy day we have been planning for”, he said.
