Epidemic Response Committee holds second meeting

More questions were fired at top government officials in the second Epidemic Response Committee meeting.

The committee was set up to ensure the government's response to Covid-19 is still scrutinised while Parliament is adjourned.

National MP Paul Goldsmith asked about the projection of unemployment for the rest of the year.

Finance Minister Grant Robertson said looking at the global financial crisis that resulted in a 6.7 percent unemployment, "we'll be in excess of that".

He couldn't say by how much but that it depended on how the subsidies were distributed. The wage subsidy scheme paid out $4.2 billion as of yesterday and it is expected to be more than $5b by the end of today.

Robertson said Treasury was in the process of finalising it now and the unemployment numbers could be expected in a matter of days.

Chief Executive and Secretary to the Treasury Dr Caralee McLiesh said a significant increase in unemployment was on the horizon "a little over 5 percent well into the double digits".

McLiesh said Treasury was looking at different industries and how they had been affected in alert level - tourism was hit hard, but essential services were better off.

"If we look across the economy, level 4 resulted in reductions in the output of about 40 percent," she said emphasising it was an estimate.

Treasury was working to set up a team of experts to help set up bespoke plans for larger businesses affected by the lockdown, she said.

Rent freeze for commercial property tenants questioned

Simon Bridges asked about a rent freeze on commercial rents after the government froze residential rent increases.

Robertson said wages and rent were the biggest costs for small and medium businesses and that the government was working on that now.

"We'll have something to say about that in the coming days."

ACT Party Leader David Seymour said there was confusion regarding rents and what government interventions will be.

"Our first best response has to be people making pragmatic arrangements with one another," Robertson said.

"Not everybody is playing nice so we are aware of the issues. We are talking to Property Council and working on a package that will support us through this."

Goldsmith accused the government of only releasing health-related information daily, but no specific information about the day-to-day economic impact of the lockdown.

Labour MP Ruth Dyson said it would be helpful to have more data on the Covid-19 website about the other issues being addressed and what the government was doing, in order to help build public confidence.

"It's a pretty quickly moving process," Robertson replied adding that he would consider it.

Why are supermarkets essential but not butchers, bakers?

Bridges said the government had created a "duopoly" by handing over the business to the country's two largest supermarkets.

Economic Development Minister Phil Twyford said there was no evidence of "price gouging or abuse of their market position".

The public could report this kind of behaviour and some people had, he said. The (pricewatch@mbie.govt.nz) email address had received 866 emails so far.

MBIE Labour, Science and Enterprise deputy chief executive Paul Stocks said to minimise public gatherings, only supermarkets were allowed to operate.

As for dairies, it is a supplier that has a mixed range of products, not a single line.

The reason dairies were open was for those who didn't have access to supermarkets. However, he said there was no reason butcheries and bakeries needed to be open and not supply to supermarkets.

Bridges raised the issue of inconsistencies, food wastage, animal welfare.

Seymour asked if and when butchers, bakers and fresh fruit and vege stores, would be allowed to resume operations.

The government was considering that, Twyford said.

"We're weighing up all of those things now without compromising the core objective of minimising movement."

Twyford couldn't say if it was based on a health notice to have only supermarkets open where more people congregated as opposed to a local butcher.

National MP Michael Woodhouse asked if it was safer to do so. He said it was undermining butchers and bakers being able to maintain the distance rules, just as well as supermarkets.

'We will see a lot of insolvency' - economist

Economist Shamubeel Eaqub said he was looking at the Covid-19 experience in New Zealand in three stages:

1. The lockdown

2. The purgatory

3. The new normal

"We haven't experienced this before," he said.

He said the various subsidies were welcome but the government should not socialise all costs.

"It is important to have cash flows to preserve businesses.

"We have to be careful about the extension of the lockdown, [or] we are going to see many more businesses fail unless there are more generous provisions."

He said people in government jobs needed to be secured.

"Government needs to lead by example."

Once the lockdown ends, our borders are likely to remain quite restricted and the global backdrop likely to be unsettled.

He said there would be a demand for bridging finance after the lockdown.

"I fear we will see a lot of insolvency in the coming months," he said.

"It's important the infrastructure of the economy is protected.

"If we have business failures we don't have the economic infrastructure."

He said the new reality was businesses suddenly having to deal with loss of revenue over what previously was shortage of staff.