COVID-19 Economic Response Package

COVID-19: Economic Response Package

The most significant economic plan in modern New Zealand history to cushion the impact of COVID-19 in the fight to support Kiwis’ jobs and the domestic economy from the virus.   

Our Government took decisive action to protect jobs, incomes and businesses in the face of COVID-19. Below is more detail about our Government’s immediate Economic Response Package, launched in March.

On 17 March, the Government announced an initial $12.1 billion COVID-19 Economic Response Package to protect the health and wellbeing of Kiwis. The package is about protecting New Zealander’s health, protecting the vulnerable, protecting livelihoods, and ensuring the quickest recovery possible on all fronts. 

As the situation changed, the package has been expanded. The package now includes:

  • An estimated $9-12b in wage subsidies so affected businesses can keep their staff employed, through support received directly from the Government.

  • An initial $500m boost for health, because the best medicine for the economy is getting the virus under control.

  • $126m in COVID-19 leave and self-isolation support for people who are unable to work because they’re sick, self-isolating, or caring for dependants. Since being announced, this has been rolled into the Wage Subsidy Scheme.

  • A $2.8b income support package for our most vulnerable, including a permanent $25-per-week benefit increase and doubling the Winter Energy Payment for 2020.

  • A $100m redeployment package, to keep more New Zealanders in work.

  • $2.8b in business tax changes to reduce cashflow pressure, including a provisional tax threshold lift, the reinstatement of building depreciation, and writing off interest on the late payment of tax.

  • An initial $600m package to support the aviation sector and protect New Zealand’s supply chains.

  • A $6.25b Business Finance Guarantee scheme for small and medium-sized businesses, to protect jobs and support the economy.

  • A $27m package for social sector services and community groups so they can continue to provide essential support to communities.

  • A leave scheme for essential workers who take leave from work to comply with public health guidance, to ensure they will continue to receive income.

  • Further support for small and medium-sized businesses, including a $3.1 billion tax loss carry-back scheme, changes to the tax loss continuity rules and further business consultancy support

  • Greater flexibility for affected businesses to meet their tax obligations

  • An interest-free loan scheme for small businesses, providing assistance of up to $100,000 to firms employing 50 or fewer full time equivalent employees.

Other measures the Government has taken include:

  • The Government, Reserve Bank and retail banks have agreed on a six-month mortgage principal and interest payment deferral for affected individuals and SMEs.

  • To protect renters during this difficult time, we’ve frozen all rent increases for six months, prohibited no-cause terminations for an initial period of three months, and evictions cannot occur for unpaid rent for up to 60 days.

  • Measures to support commercial tenants and landlords

  • The Government has announced a law change that will fast track eligible development and infrastructure projects under the Resource Management Act to help get New Zealand moving again

  • The Government has fast-tracked measures to protect people in financial hardship from high-cost loans that trap them in debt

  • The Government has agreed to freeze charges at the border to help export and import businesses and protect jobs from the impacts of COVID-19

  • New Zealand has signed, alongside other APEC countries, to a commitment to promote a more stable trading environment for our food exporters, and help provide reliable access to the critical medical supplies we need.