Change in Covid-19 hit tourism industry will be 'long-lasting' - Finance Minister

May 18, 2020
Finance Minister Grant Robertson and Director of Public Health Dr Caroline McElnay address media today.

Businesses most hard hit by Covid-19 need to start considering restructuring and reorientating for the long term, Finance Minister Grant Robertson says. 

Mr Robertson was asked about the targeted extension of the Government's wage subsidy on TVNZ1's Q+A, after it was given $3.2 billion at Budget 2020 for an extra eight weeks to businesses with a 50 per cent or more revenue loss. 

Grant Robertson appeared on TVNZ1’s Q+A on May 18, 2020.

"We've been flexible, we've responded to need as its arisen," Mr Robertson said. "We are now targeting more, I think that's the right thing to do."

"I'm not in a position of saying 'that's it, it's a total cut off', but this is us showing we're focusing more for that eight week period."

"What we've tried to do is support the vulnerable, but the viable."

Host Jack Tame asked if it was a question of business viability, if at the at the end of the eight-week extension the business was still not at 50 per cent.

"This is the period in which businesses do need to be starting to make their long-term plans, to be thinking about how they restructure and reorientate their business to be able to trade as we move out of the Covid-19 environment," Mr Robertson said. 

"It’s important that we’re flexible about the way we provide ongoing assistance and support. And we’ve done that up till now, and we’re going to keep doing that."

On the tourism industry, Mr Robertson said border restrictions would "last in some form for some considerable time".

"It's not just about our border restrictions either, even as they're lifted and in other parts of the world, people will be reluctant to travel in the large numbers they have been in the near term."

"I think the change that’s happening to the tourism industry is one that is going to have a long-lasting effect.

"The people I speak with in the tourism industry absolutely get the fact that they need to reorientate their business models."

A targeted tourism recovery fund was allocated in Budget 2020 giving $400 million to the struggling industry, however, no further details were given on this funding.

National's Todd McClay called the funding "welcome, but it’s nowhere near enough".

"Crucially, there is no clear plan on a path forward for the industry. What we need is a timeline and under what condition the Trans-Tasman border might open.

"This will be a bitter pill to swallow for an industry which has already sacrificed their livelihoods to go into lockdown for the past eight weeks."

Mr Robertson referred to the fund as part of a "recovery plan with the industry".

"I’d rather focus on that, on supporting the businesses to transition and carry on that way. The border restrictions are going to be with us for some time, so I think we have to be realistic about the impact of that."

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