ACE New Zealand's Finance Manager, Janet Ziegler, shares her outtake of the Prime Minister's speech on the government's approach as we recover from COVID-19.
Last week I had the opportunity to attend the Wellington Chamber of Commerce breakfast where Prime Minister Jacinda Ardern was the keynote speaker.
She covered a wide range of topics including the ongoing effects of the COVID-19 pandemic, the world economic forecast and outlined the Government’s five-point plan for our economic recovery.
Jacinda was adamant that the whole country should remain vigilant as a resurgence in COVID-19 cases is almost inevitable. Every country the health authorities follow for guidance on how to handle this pandemic has seen a resurgence of COVID including Vietnam, Taiwan, Singapore and Australia. The open economy that we have in New Zealand makes us extremely privileged compared to other parts of the world, and we all need to value that and make the most of it.
She then moved on to the IMF economic forecast for the globe, which is worsening as the COVID-19 effect continues to decimate business activity in so many countries.
The average projected decrease in the world economy is around 4.9 per cent but could rise to seven per cent in more advanced economies like the USA. In some critical areas of internal financial modelling, New Zealand is currently tracking better than expected. Still, it’s too early to tell if that progress will be sustained or whether it’s a post lockdown blip.
The Government’s five-point plan for economic recovery includes areas where the construction industry could benefit from new projects. She stressed that Rob Fyfe would continue working as an advisor to the Government on business strategy. He will focus on the strategic plan, and the PM encouraged the business community to reach out to him with ideas that may be a fit for the recovery plan.
Summary of the plan
Here’s a quick summary of the plan:
1. Investing in people
With the extended wage subsidy coming to an end, the Government is now transitioning to the COVID-19 income relief payment scheme. This involves 12 weeks of paid support should you lose your job. The payment aims to support people while they move to a new job.
Other initiatives include:
- Targeted support for severely affected industries, including tourism
- Free training targeted explicitly at moving people into apprenticeships
- A subsidy for employers who take on an apprentice
The Government will promote shovel-ready projects that will do double duty by supporting the Government’s key policy areas - housing, climate change, water and the environment. Jacinda used the Three Waters Reform programme as an example of how new policy contributes to community wellbeing in several ways. Government policy will not only help Councils with the development of new infrastructure for the provision of clean drinking water and the replacement of ageing stormwater services but also support regional council projects including riparian planting and fencing.
3. Preparing for the future
Here she spoke about the renewable energy future and included the announcement of the pumped hydro feasibility study.
4. Small Business
There was a further comment on apprenticeship funding but also focussed on:
- Developing exports and markets
- Funding projects that encourage spending in the regions
5. Our global position
She told us that the Government remains committed to supporting exporters through branding focused on safety and trust. We are well placed to take advantage of the significant brand exposure we have gained through our handling of COVID-19.
What’s clear is that there are still many challenges ahead, it won’t be plain sailing, but the Prime Minister’s understanding of the issues and her ability to articulate our approach gave me real confidence for our sector.