Treasury advice to Jacinda Ardern: COVID-19 impact could be worse than global financial crisis

The Prime Minister has been advised by Treasury that the impact of the coronavirus pandemic could be worse than the impact of the 2008 global financial crisis (GFC).

"The preliminary advice I have received from the Treasury this weekend is that the economic impact of the virus on New Zealand could be greater than the impact of the global financial crisis," Jacinda Ardern said on Monday.

The Prime Minister says based on the advice, because the GFC led to a recession, Treasury is now predicting a COVID-19 recession too.

The Government is announcing its massive economic support package on Tuesday so Kiwis will learn more about the consequences and the response from Finance Minister Grant Robertson.

The Prime Minister has also announced that any gatherings of over 500 people are now banned in New Zealand indefinitely.

Smaller gatherings can still go ahead for now, but the Government is working on a separate plan to manage events like weddings and funerals.

"Within the next month, approximately 107 events that are each expecting over 1000 attendees are scheduled to take place in Auckland, Waikato, Wellington and Christchurch alone," Ardern said.

But not anymore - they're all cancelled. Gatherings of 500 people or more - indoors or outdoors - are banned.

"I know that this decision is hugely disappointing. I know it will have an impact on a large number of communities," Ardern said.

It makes world festival WOMAD over the weekend one of New Zealand's last festivals for the foreseeable future.

The Prime Minister said there is currently "no end date" to the policy on gatherings.

Dealing with indoor get-togethers is trickier, such as going to the movies, going to gigs, things like yoga or the gym, and gathering at places of worship. The Government is still working on a plan for that.  

Treasury advice to Jacinda Ardern: COVID-19 impact could be worse than global financial crisis
Photo credit: Newshub.

Newshub asked Ardern if New Zealand will reach a point where bars and restaurants will be closed, and she said it's "all about making sure that we're able to maintain - in any environment you're in - social distancing".

Ardern said that's "the way we have to start behaving now - that's the new normal".

More social rules and restrictions will be revealed later this week, giving more clarity for people organising funerals or planning weddings.

"I do recognise that actually already some of the measures we've put in place have affected weddings," Ardern said.

"I know people who have already been affected by border controls and I know how devastating that must be."

 

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