Finance Minister, Grant Robertson has delivered Budget 2021, The Wellbeing Budget. While the government is forecasting a jump in economic growth, a shrinking deficit and lower than expected levels of debt, the effects of Covid-19 are still evident. The government are not expecting to return to a surplus until 2027.
Robertson stressed that this is only the first budget of a set of three before the next election; expect the next two budgets to be much more focused on climate change and the macro economy. with the main beneficiary being beneficiaries who will receive a $3.3 billion boost – increasing benefits by up to $55 per week by April 2022.
While the Minister referenced the hospitality industry in his opening remarks “hospitality and events have taken a hit”, there are no big ticket wins for the industry, however we summarise some of the key points for hospitality below. We will provide more detail when this is available.
The Budget Priorities:
- Keep New Zealanders Safe
- Accelerate rebuild following COVID-19
- Tackle foundational challenges
Key points for Hospitality:
- Industry transformation plans for seven industries, including food and beverage and tourism
- To increase productivity
- Will see engagement with all stakeholders in the sector
- Tourism Communities: Support, Recovery and Re-set Plan
- Funded from the COVID-19 Response and Recovery Fund, the $200 million Tourism Communities: Support, Recovery and Re-set Plan provides support for those communities that are most reliant on international tourism, as well as for the tourism (and hospitality) sector nationwide, to enable the reset of tourism in response to COVID-19 to be more sustainable and resilient.
- Targeted support will be provided to businesses in the communities hardest hit by the impacts of COVID-19, such as Kaikōura, the Mackenzie District, Queenstown Lakes, Fiordland, and South Westland.
- Future of Work:
- Enabling all New Zealanders and New Zealand businesses to benefit from new technologies and lift productivity and wages through innovation and support into employment those most affected by COVID-19, including women and young people. The Budget identifies government assistance, for example, by providing a digital skills programme and training support so industries, businesses and workers have the skills they need to succeed in an increasingly evolving digital environment.
- Retail Payments System: Reducing Merchant Service Fees
- The proposed Retail Payments Bill, will introduce a regime to regulate thresholds for merchant service fees.
- The initiative will support the Commerce Commission to address inefficient competition, which will ultimately help to deliver long-term benefits to merchants and consumers.
- Development of social unemployment scheme
- ACC style scheme
- 80% of income, with minimum and maximum caps
- Worked through with BusinessNZ and CTU
- Small Business Digital Training, Advisory and Support Programme
- This initiative will enable partnering with the private sector to deliver a two-year nationwide programme to supply
- core digital business skills training to 50,000 to 60,000 small businesses,
- digital business advisory service to assess digital needs and
- create bespoke digital business action plans.
- This initiative will enable partnering with the private sector to deliver a two-year nationwide programme to supply
- Getting more Kiwis into education and training:
- Budget 2021 extends funding for the Training Incentive Allowance to New Zealand Qualifications Authority (NZQA) levels 4 to 7 for four years to support around 16,000 sole parents, disabled people and carers with the costs of getting degree-level tertiary qualifications.
- Extending the Apprenticeship boost programme.
Key Overall Points from 2021 Budget:
- Weekly benefit rates lifted by between $32 and $55 per adult, in line with a key recommendation from the Welfare Expert Advisory Group (WEAG).
- In total, 109,000 families and whānau with children will be, on average, $175 a week better off as a result of changes made by the Government since 2017.
- Student living support will increase by $25 per week on 1 April 2022.
- $380 million delivering about 1,000 new homes for Māori including papakāinga housing, repairs to about 700 Māori-owned homes and expanding support services.
- $242.8 million for Māori health initiatives, including setting up the new Māori Health Authority.
- $150 million in Māori Education to support Māori boarding schools and lift kōhanga reo teachers’ pay.
- $42 million to build a sustainable Māori media sector and invest in programme content.
- $15 million for Māori tourism.
- $14.8 million for the implementation of the Māori language strategy.