Finance Minister Grant Robertson during the post-Cabinet press conference, Parliament, Wellington. 09 February, 2021. Photo / Mark Mitchell
Finance Minister Grant Robertson has revealed the Government considered giving New Zealanders a US-style stimulus check to provide an economic cushion to the Covid-induced downturn.
But that form of what he this morning called “helicopter-style payment” was turned down in favour of the multi billion-dollar wage subsidy scheme.
Speaking to the Finance and expenditure committee this morning, Robertson said the Government considered “a range” of stimulus options during the height of the Covid downturn.
But the Government settled on the wage subsidy scheme as it gave people “a longer-term period of certainty, as it’s about that attachment to the job”.
He said that lead to a “level of confidence which has stimulated the economy”.
“I’ve got a view that genuine stimulus in the economy is more likely to come from [the likes of] the wage subsidy scheme, than a one-off helicopter-style payment.”
He did not directly reference the US stimulus check scheme, but that economic plan was also known as “helicopter money”.
Robertson said that form of economic stimulus worked in countries where there was a sharp economic downturn, such as the US.
But he told MPs this morning that he was “attracted to a form of stimulus that is enduring and builds confidence”.
Treasury secretary Caralee McLiesh was also at the hearing but again refused to speak with media after she was finished in the committee.
That means media were unable to ask further questions on how much discussion actually went into adopting a similar US-style stimulus check in New Zealand.
US law makes recently approved a $1.9 trillion relief package which comes in the form on stimulus checks to most Americans.
This is the third such check that has been approved by the Government. They are one-off payments of up to US$1400 ($1950).
To date, more than $14b has been paid through NZ’s wage subsidy scheme to more than 750,000 businesses.
That number will no doubt rise, as eligible businesses can claim more money from the scheme because of the most recent Auckland outbreak.