Clarity Needed On Wage Subsidy Scheme
As National supports the urgent wage subsidy to businesses affected by COVID-19, we request the Minister of Finance to clarify the assumptions underlying the policy, National’s Finance Spokesperson Paul Goldsmith says.
“Grant Robertson today was very vague about the assumptions underlying this $5 billion policy.
“Wage subsidies for struggling
businesses are urgently needed and National welcomes the
policy.
“Our primary concern with the Government’s scheme is that businesses can only claim subsidies for the first 21 employees.
“Basic questions need to be
answered, such as how many workers are expected to be
covered.
“Based on data from MBIE, there are
600,000 workers in New Zealand who work for a business with
fewer than 20 employees. For the 15,000 businesses with more
than 20 employees, there are only around 300,000 workers who
will be eligible to be covered.
“That means
there are approximately 900,000 workers eligible for the
wage subsidy scheme. Yet based off the $5.1 billion policy,
the Government is assuming over 700,000 workers will need to
be subsidised.
“It seems unrealistic to think
that over 80 per cent of eligible workers will be subsidised
over the next 12 weeks.
“The Government needs to
release the data and assumptions underlying the policy. The
Minister of Finance’s refusal to immediately release the
Cabinet Paper underpinning the policy is
appalling.
“Major spending decisions, no matter how urgent, deserve basic scrutiny.”