Crown to meet Isolation and Quarantine costs

Crown to meet Isolation and Quarantine costs

But a Longer-Term Border Management Strategy is being developed

Sourced Content, Wellington, June 28, 2020

The Navy has been posted outside a Novotel being used as a managed isolation facility in Auckland (RNZ Photo by Chen Liu)

The following are a part of the Document Dump released by the Department of Prime Minister and Cabinet yesterday (June 27, 2020). This was the second tranche of documents relating to the government’s response to Covid-19

Isolation costs

Government officials flagged the possibility of requiring people to contribute to their own isolation costs back in April, as they anticipated the return of tens of thousands of New Zealanders.

Figures released today show that a number of New Zealanders flew out of the country during lockdown and returned within weeks, many staying at managed isolation hotels.

Sixty people left the country after Level 4 restrictions were introduced and returned before May.

Those who returned after April 9, would have stayed at managed isolation hotels on their return.

The reasons for travel varied with 20 visiting friends and relatives and 14 travelling in and out of New Zealand for business.

A briefing from the Prime Minister’s Office, dated April 9, said until a “longer-term border management strategy” had been developed, the cost of providing managed isolation and quarantine facilities “will be met by the Crown.”

However it said that officials would “consider cost recovery and cost sharing approaches … particularly for people who are seeking to repatriate after an extended absence.”

The government has so far spent about $80 million on border isolation facilities, with a budget of a further $300 million to see out the rest of the year.

Deportees from Australia

Australia has started deporting New Zealanders again, after that had been suspended due to the lockdown. Officials have been planning how to best manage Australian deportations when they began again.

The policy to deport New Zealanders with a criminal history or those not seen as meeting a good character test has been a point of strong contention between the two countries.

The documents released this morning include a report to Corrections Minister Kelvin Davis in April which said, like all overseas arrivals, deportees will be required to stay in managed isolation for at least 14 days. It said that Corrections was aware of the safety risks deportees may pose if they were put up in the same accommodation as other arrivals.

A team of six people at Manukau Community Corrections will manage arrivals at the Auckland Airport. A police spokesperson said deportations were postponed from March, but a “small” number of individuals are currently scheduled to be returned to New Zealand from Australia.

Visible Pay Restraint

The Cabinet asked the public service to show “visible pay restraint” as a result of Covid-19.

A Cabinet Committee minutes from April 15, 2020 noted that Prime Minister Jacinda Ardern would be taking a 20% pay cut for six months, and that public service chief executives had agreed to do the same. It also said that the government felt restraint across the whole public sector was “an appropriate response to the Covid-19 context, where private sector employees are experiencing job loss and pay cuts.”

Income Support Costs

Almost $176 million paid out in the government’s wage subsidy scheme has been refunded. The latest figures from the Ministry of Social Development show close to 6000 refunds have been made so far. All up, $11.9 billion has been paid out through the wage subsidy scheme, supporting almost 1.7 million jobs.

Meanwhile, the papers on income support put the total cost of the 12-week Covid income relief payment at $850 million. People who have lost their jobs because of Covid-19 can now apply for the special income relief payment; it pays $490 a week for those who are out of full time work.

A report to Ministers said that 80,000 people previously ineligible for the benefit would be able to get the payment. Close to 7000 people are already receiving it.

Finance Minister Grant Robertson said that it had been difficult to forecast exactly how bad job losses would be.

Treasury warning

The Treasury warned Mr Robertson that the Reserve Bank’s $60 million money printing programme had ‘significant downside risks.’ In a paper issued on May 6, 2020, the Treasury advised that the scheme, to buy $60 billion worth of bonds, came with “significant uncertainty about the returns.”

“It is plausible that the programme will return a net gain. However, there are significant downside risks. The Bank’s best estimate of large but plausible interest rate losses arising from the programme is a net loss of $2.3 billion,” the paper said.

(From Twitter)

Funding NZ Post

The Treasury recommended that the government gives NZ Post a loan similar Air New Zealand, to help it stay afloat through the pandemic.

In a briefing on April 3, 2020, the Treasury warned that NZ Post’s cash flows would be “materially impacted” by the level 4 lockdown, affecting the viability of this essential service. It recommended providing a $150 million loan because this would incentivise NZ Post to only borrow what it needed.

Similar to the $900 million loan to Air New Zealand, Treasury recommended an arrangement where the government could convert the loan into equity.

However, the  Cabinet rejected this recommendation but agreed to a $280 million bailout, made up of $130 million from Budget 2020, and a $150 million cash injection from the government’s Covid Response and Recovery Fund.

Home Schooling

The Education Review Office said learning from home during the lockdown did not work for most secondary students studying for NCEA.

In a paper to Education Minister Chris Hipkins, the Office said that a survey found three quarters of students in Year 11 to 13 said they did not cope as well with the workload and expectations while learning from home.

The Paper said that most secondary students said they could not easily access the support they needed. In contrast, far more primary school pupils said they got the help the required.

Pregnant and elderly during lockdown

The documents also showed elderly and pregnant women were subjected to public criticism for leaving their homes during lockdown.

The guidance delivered to the Covid-19 Ministerial group for people at higher risk of Covid-19 when entering alert level 3 is part of today’s documents release.

It noted specific recommendations and communications for at-risk groups needed to be carefully managed, to avoid reducing their employment status and rights, stigmatisation and victim blaming.

They said there had been previous reports of public criticism directed at older people and pregnant women who were outside of their homes, whether for work, supermarket shopping, doctor’s visits, or exercise.

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