The Government has in the past month paid out $9.9 billion in the Covid-19 wage subsidy scheme that was announced on March 17, according to the latest Treasury report released today.
The report paints a bleak picture, indicating that the economy will continue to tighten into the June quarter.
Economic activity has all but ground to a halt with retail spending down substantially, albeit a peak time for the grocery sector.
It comes as figures skyrocket for those taking the Government’s Covid-19 wage subsidy and Job Seeker support.
Jacinda Ardern addressed media today to give an insight into the next step after lockdown. (Source: Other)
Latest figures from The Treasury reveal the 1.6 million New Zealanders needing income and job support from the Government’s wage subsidy have benefitted by the $9.9 billion already dished out from the scheme.
In comparison, about 23,000 new people are now part of the Ministry of Social Development’s Job Seeker support scheme.
The Finance Minister said today New Zealand’s action to “move early” and get money out the door to support businesses and workers was the “right one”.
While income support is up, spending is down. The Treasury report shows retail spending plummeted in February and March.
Stats NZ data outlines spending on eating out and accommodation spiralled downwards more than $300 million in March as restrictions were put in place for Kiwis entering lockdown amid the global pandemic.
Total retail sales fell $231 million, or 3.9 per cent, in the month of March, according to Stats NZ. Card spending on travel fell $66 million, or 53 per cent, over the same period in the wake of domestic and international travel restrictions announced to slow the spread of coronavirus.
Fuel spending was down $113 million, or 19 per cent, as Kiwis were urged to stay home from the last week of March onwards.
Grocery spending, however, jumped $376 million, or 17 per cent, last month.
“This is the largest dollar value and percentage increase in grocery sales since the retail card spending series began in 2002,” retail statistics manager Sue Chapman said.
It comes as food prices rose 0.7 per cent in March, with vegetable prices rising by 7.4 per cent. Treasury says this was “partly offset by lower meat prices”.
And while house prices are holding up, sales activity fell significantly by 16.3 per cent, the weakest number of March sales since 2011.
The retail and hospitality sector, however, look to improve when the country does enter Alert Level 3.
The Government announced yesterday that most businesses will be able to open at that level if their workers cannot work from home.
Face-to-face transactions remain off limits, however, meaning non-essential retail and hospitality premises must stay closed except for drive-through, click-and-collect and delivery services.
Cabinet ministers will decide on Monday if New Zealand will stay or leave Alert Level 4.
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