OPINION: This is beyond huge, the government was not hyping the situation when it said this would be significant - nor was Jacinda Ardern when she said this would be the biggest thing she announces as Prime Minister.
A massive $12.1 billion to combat the economic effects of COVID-19. That’s bigger than the government’s infrastructure package, four times what would usually be spent on operational costs in a Budget, 4% of GDP. The largest single government investment in our lifetimes.
It’s what’s described by economists as a "fiscal bazooka."
And that’s because the economic situation is as bad as it gets, it will hurt hard for a long time and it won't discriminate - the economic shock will be near-universal.
As the Finance Minister has said, jobs will be lost, businesses will fail. There’s no sugar-coating this.
This package is the defibrillator - an attempt to electrify and send a jolt back into the economy. But with the full-blown expectation that it will not fix everything.
It’s about cushioning the impact not preventing it, that’s simply not possible.
We don’t yet know the impact on the economy of COVID-19 and so this is just the start. Expect broader stimulus measures in May’s Budget.
But what a start this is. The wage subsidies alone cost $5.1b. To put that into perspective, wage subsidies in the wake of the Christchurch Earthquake cost just a little over $200m.
Anyone being flippant and blasé about COVID-19 or its impacts - snap out of it. This is your 12billion dollar wake up call. The fiscal bazooka that proves the government is taking this seriously and so should you.
Tova O'Brien is Newshub's political editor.
