Fran O’Sullivan Take us to level 1 without delay
Ideology stands in the way of NZ getting back to business
The Government is being quite cynical in letting Hollywood filmmakers back into the country to resume production, yet denying other sectors the right to do so under similarly stringent quarantine conditions.
Prime Minister Jacinda Ardern is proving wilfully deaf to the message that it is time to politically bank the Covid-19 disaster and get New Zealand fully back to business.
Even Deputy Prime Minister Winston Peters is openly of the view that “blind ideology” is what is now standing in the way of New Zealand quickly moving down to alert level 1, establishing an airbridge with Australia and letting foreign students back into the country.
In that, he is not alone.
The Government is being quite cynical in letting Hollywood filmmakers back into the country to resume production, yet denying other sectors the right to do so under similarly stringent quarantine conditions.
Businesses large and small want activity to gear up so that economic confidence can be lifted.
There is a growing murmur that “enough is enough”.
With New Zealanders being encouraged to enjoy a “normal” Queen’s Birthday weekend after seven straight days of no new Covid cases — and with just one active case in this country — why the hold-up?
Does the Prime Minister simply want to establish a world record that New Zealand has beaten Covid-19 altogether and stamped it out completely? Or is she prepared to adapt to a world where there may well be a resurgence of the virus but this time round we have the capacity to deal with it instead of moving back to a level 4 lockdown.
The prime ministerial intransigence has business implications.
Take Air New Zealand. Ardern has suggested there is a “realistic” prospect that a transtasman bubble could be in place by September. Peters says it could have happened yesterday with Tasmania for instance.
But the transtasman working group reckons it can be done in July.
The longer Air New Zealand has to wait to resume flights across the Tasman (with suitable precautions at either end) the more desperate its financial situation will become. This makes it a certainty that it will have to raise capital to restore its balance sheet in the face of the already severe cash burn.
This will prove a politically difficult exercise.
While Air NZ has negotiated a debt facility with the Government which can be converted to equity, the Government is not the only shareholder to consider. If the international perception takes hold that intransigence — or the blind ideology that the Deputy Prime Minister suggests — is making it take longer for the airline to resume some of its international business, don’t expect other shareholders to be happy.
Nor the tourism operators who must now wait until the month of the general election for Australian tourists to come back into the New Zealand market, if the Prime Minister’s timetable prevails.
Large companies like Mainfreight and Fletcher Building have also moved on.
Mainfreight managing director
Don Braid revealed this week that he has taken a 50 per cent salary cut and other directors have had their fees slashed in half.
Mainfreight has also returned the $10.6 million wage subsidy it took on April 16 as the country was in the midst of level 4 lockdown. Braid said its New Zealand Transport and Warehousing operations experienced significant revenue reduction at the time and Mainfreight was uncertain just how bad trading would become.
It turns out that trading levels subsequently improved, and while Mainfreight still qualified under the Government’s criteria of a 30 per cent reduction in revenue, directors felt it was appropriate to return the subsidy.
Mainfreight’s decision to fully stand on its own feet, rather than milk taxpayer subsidies, is refreshing.
So too, Fletcher Building’s decision not to seek an extension of the wage subsidy in June even though parts of its business where revenue is down 50 per cent would qualify.
Fletcher has also taken a severe pounding on this side of the Tasman as the construction business was not allowed to operate during the lockdown.
Managing director Ross Taylor says the most important thing now is how to get back to that balance between the management of the health situation and the management of the economy, “What happens next is far more important than what’s been.” And that is the point.
In a somewhat schizoid session in Parliament on Thursday — where the Deputy PM essentially danced a pas de deux with himself — he finally settled on the admission that “blind ideology” was the sticking point.
Standing in for Ardern, he was asked, “Does she agree with the Rt Hon Winston Peters that NZ has been in lockdown for ‘far too long’ and needs to be at level 1 now with a transtasman bubble already operating and if so, what steps will she take to advance that?”
On Ardern’s behalf he replied, “Now, I do agree with the Deputy Prime Minister [that] there were ‘different opinions, particularly expressed by the likes of members of New Zealand First around the pace of moving into level 1’.”
The Coalition has always been in lockstep on the direction of travel ever since Covid-19 hit our shores, but it’s fair to say that the Deputy Prime Minister is very keen to see us move to alert level 1 and establish a transtasman bubble as of yesterday.
The following truncated exchange got to the heart of the issue.
Hon Nikki Kaye: “Has the Foreign Minister advocated to her or to the Cabinet to proceed faster around the transtasman bubble?”
Rt Hon Winston Peters: “On behalf of the Prime Minister, take a wild guess.”
Hon Nikki Kaye: “Has the Foreign Minister advocated a date by which time he would like to see the transtasman bubble established?”
Rt Hon Winston Peters: “On behalf of the Prime Minister, in one word: yesterday.”
Hon Nikki Kaye: “What are the issues that are holding up the delivery of a transtasman bubble?”
Rt Hon Winston Peters: “On behalf of the Prime Minister, the reality is, and everyone has got their reasons for having their view, but it is the concern to ensure that the stellar record of defeating Covid-19 has, perhaps, a few more days of an unblemished record before people would be more comfortable with change. And that is a fair sentiment; whether we all agree with it is a different matter.
“What we need, of course, is the right ideology, or the lack of blind ideology, to take us as fast as possible out of it.”
Enjoy the weekend.