Keeping New Zealanders safe from COVID-19
As we adjust to living with COVID-19, our response is evolving
Over the past two years our Government's response to COVID-19 has succeeded in keeping New Zealanders safe, and our economy strong and resilient. Key to this was the establishment of the COVID-19 Response and Recovery Fund (CRRF). The CRRF has provided a stable source of funding, allowing us to invest in crucial response functions and targeted supports that have enabled key sectors to weather and recover from the economic impacts of COVID-19, while keeping New Zealand's net debt in a world-leading position.
COVID-19 Response and Recovery Fund
The CRRF was established in April 2020, following a $12.1 billion package announced on 17 March 2020 that provided an initial response to the immediate impacts of the first COVID-19 outbreak and lockdown. The CRRF began as a $50 billion fund, with subsequent increases required to ensure that sufficient funding was available to manage the impacts of the Delta and Omicron outbreaks.
The final size of the CRRF is $61.6 billion, of which $58.4 billion has been allocated to response and recovery initiatives, leaving a remaining balance of $3.2 billion in April 2022. The most significant areas of investment in the Government's COVID-19 response have been:
- $18 billion paid to businesses since March 2020 through the Wage Subsidy Scheme and $432 million for Leave Support Schemes, to enable firms and workers to stay connected to employees who were unable to work due to illness or public health restrictions.
- support for businesses experiencing a drop in revenue due to COVID-19 public health measures, including $2.9 billion provided to businesses through the Resurgence Support Payment introduced in February 2021, and $1.1 billion through the more targeted COVID-19 Support Payment in February 2022.
- $10 billion toward supporting our public health response including providing funding for testing and tracing, purchasing vaccines, and increasing our intensive care and inpatient capacity.
- investment in infrastructure to create jobs and kickstart the economic recovery including establishing a $3 billion infrastructure fund announced in July 2020, and the $3.8 billion Housing Acceleration Fund agreed through Budget 2021.
* This chart includes funding decisions from the initial $12.1 billion response package and from the CRRF. The allocations are offset by $4 billion of funding that was returned to the CRRF, representing an estimated total of funding that was allocated but not spent.
** Votes receiving funding less than $1 billion from the CRRF have been grouped in this category, such as Vote Customs and Vote Internal Affairs.
As our policy response evolves and we adjust to living with COVID-19, our fiscal response needs to evolve as well. Our recent investments from the CRRF have included providing targeted support to help businesses manage the impacts of Omicron and providing funding certainty for our public health response through to the end of the year.
Now, as the COVID-19 response starts to become part of standard public service delivery, we are bringing future COVID-related costs within the standard Budget process, and repurposing the remaining CRRF funding to the most pressing issues facing New Zealanders. This includes:
- $1.2 billion set aside for any immediate COVID-related public health needs that cannot wait until the next Budget cycle
- $1 billion, or $250 million per annum, to offset investments funded from the Budget 2022 operating allowance, and
- $1 billion for a package of measures to support low- to middle-income New Zealanders to manage the rising cost of living, as outlined above.