National Party proposes Economic Plan with financial and social incentives

Judith Collins wants businesses to be unleashed (Image from Back to Business Plan)

Releasing the Business Plan, National Party Leader Judith Collins said that there is a need for a new Economic Strategy and a new way of handling the Coronavirus.

“Over the past 18 months, New Zealand’s economy has been hammered by Covid-19. Businesses in our largest city (Auckland) have suffered more than 18 weeks of lockdown. The closure of the border slashed $20 billion from our economy almost overnight with the loss of international tourists and students. Our agriculture sector lost access to seasonal workers and businesses were cut off from skilled migration. Our domestic tourism, hospitality, accommodation and events sectors have all been hit hard by regular restrictions on travel, distancing requirements and capacity limits,” she said.

Unemployment among women

Ms Collins said that small businesses and those that cannot adapt as quickly to contactless operations, such as hairdressers, physiotherapists, gyms, and cafes, have been among the worst-hit sectors.

Many of these businesses are owned by women. Many are family businesses, especially among our ethnic communities. Many of these businesses will now fail, through no fault of their own, she said.

“The unemployment rate for women is around half a percentage point higher than for men. The gap in underutilisation, which includes those employed but not working as much as they want – is even higher, with around 13% of women falling into this category compared to 8.3% of men,” Ms Collins said.

Maori, Pacifica hit hard

According to a Westpac Report, Covid has exacerbated hardship for Maori, with Maori-owned businesses in sectors like tourism hit disproportionately. Ngai Tahu, for example, were forced to close 10 of their 11 tourism businesses, while Waikato-Tainui suffered an estimated $11 million in losses. The unemployment rate for both Maori and Pacific peoples as of June 2021 is 7.8%, almost double the rate for the country as a whole.

“Pacific people and businesses, both here and in our Pacific Island neighbours, have been hit hard by Covid restrictions, including being cut off from international travel. There are approximately 1500 Pacific employers, and 500 Pacific not-for-profit organisations in New Zealand, mostly centred in South Auckland, employing over 160,000 Pacific people. We need to act to ensure these businesses survive and thrive,” Ms Collins said.

Rising public debt

She said that the need of the hour is not a higher rate of debt and tax but increasing support to businesses, which are in turn people.

“National Party’s economic team has developed a comprehensive plan that will save livelihoods and unleash our economy,” she said and urged the government to adopt it immediately so that New Zealanders can back our businesses to succeed.

Salient Features of National’s Business Plan

A clear strategy and plan: Covid has required New Zealanders to make sacrifices; children to miss school, businesses to stay shut, and families to isolate from loved ones. These measures have until recently had strong public support because they were part of a clear game plan to eliminate Covid. With elimination no longer the objective, there is uncertainty.

Fair compensation: Over the last 18 months, businesses have followed the rules and kept their doors shut to keep us all safe, even when many could have operated safely. Even at lower alert levels, many have faced restrictions on their ability to trade. The financial burden of following these public health measures has been high – for some businesses too high. It is only fair that where a business’ ability to trade is harmed by public health restrictions, they receive fair compensation from the government.

 
Hairdressers, physiotherapists, gyms, and cafes have been among the worst-hit 
(Image from National Party Back to Business Plan)

Trusting businesses to play their part: Businesses have played a huge role in our Covid response to date, and they have every incentive to do the right thing and continue to keep us safe. Businesses want to protect their staff, their customers, their brand, and the communities they operate in. Businesses have now had more than 18 months to understand and adapt to the risks of Covid. With elimination no longer the strategy, it’s time for the government to start working with the business community to keep us all safe.

From elimination to managing risk: At the beginning of the pandemic, lockdowns were the only option we had to slow the spread of Covid. But now we have a range of tools available to us, including vaccination, masks, rapid testing, contact tracing, and tracer apps. As we move away from elimination, we also need to move away from the blunt use of lockdowns to dealing with Covid whenever it pops up. We need to be more sophisticated in how we manage the risk of Covid while allowing normal business activity to continue as much as possible. Ambiguous policy on vaccinations and testing in workplaces is helping no one.

Transparency: The government was afforded a high degree of freedom to operate at the start of the pandemic. Political parties across Parliament, along with the media, recognised these were unprecedented times and the need for speed trumped the need for typical levels of scrutiny. But that time has passed. Now, more than 18 months into the pandemic, it is imperative that oversight is restored. The government has spent at least $12 billion of the Covid Fund on projects that have nothing to do with Covid. Our economic response must shift urgently from slush funds and backroom deals for favoured sectors, to open and transparent spending decisions backed up with clear and defendable justifications.