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Budget 2020 fails to deliver for tertiary students


Finance Minister Grant Robertson has unveiled the Government’s second Wellbeing Budget at Parliament today.

Delivered in the shadow of a 1 in 100-year shock to the economy as a result of COVID-19, Budget 2020 sets out the Government’s planned spending for the 2020/21 financial year.

The budget, titled Rebuilding Together, establishes a $50 billion COVID-19 Response and Recovery Fund to be invested in jobs and the economy.

While many New Zealanders will be looking to retrain in the coming months, the tertiary education sector has received little support.

Calls from tertiary students to increase student allowance eligibility or the amount students can borrow to assist with living costs have gone unanswered.

In his budget speech to parliament, Grant Robertson warned there was no “sugar coating” the impact COVID-19 has had on the Government’s books. He said there would be a sharp fall in economic activity and a significant rise in unemployment in the coming months.

Robertson said Māori and Pasifika, young people just entering the labour market, and those in lower income households will bear the brunt of COVID-19’s economic fallout and Budget 2020 will hopefully address this.

COVID-19 Response and Recovery Fund

The centrepiece of Budget 2020 is the $50 billion Response and Recovery Fund. It includes the $13.9 billion already spent by the Government on its COVID-19 response since early March.

Budget 2020 sets out how a further $15.9 billion of the Fund will be spent on the COVID-19 recovery phase.

Extension to the Wage Subsidy scheme

The Wage Subsidy Scheme will be extended to provide further support for those businesses most affected by COVID-19.

From 10 June, businesses who have suffered a 50% revenue loss over the 30 days prior to applying compared to the same time last year will be eligible for a targeted wage subsidy. It will be available for a further eight week period on top of the 12 weeks already paid out.

The targeted scheme will cost an extra $3.2 billion and will help sectors struggling the most such as tourism, hospitality and retail.

The initial wage subsidy scheme has cost $10.7 billion and has helped over 1.7 million workers.

A further $150 million will be spent to increase support for research and development. A short-term, temporary loan scheme will be launched to incentivise businesses to continue research and development programmes that may be at risk due to COVID-19

Tertiary education spending

A $20 million student hardship fund to support tertiary students who have found themselves “particularly impacted” by COVID-19 will be established under Budget 2020.

Education Minister Chris Hipkins said a major advantage of this approach was that it can be implemented easily, will be distributed by tertiary education providers and “gets money into the hands of students who need it quickly”.

“There’s no one-size fits all approach to meeting the financial needs of students who can’t access the general student supports available,” Hipkins said.

“[The fund will] help those students get through the next few months and keep them engaged in their studies.”

A Trades and Apprenticeships Package worth $1.6 billion has also been created to provide retraining opportunities to those who may have lost their jobs as a result of COVID-19.

This includes $334 million funding for additional tertiary education enrolments and a $320 million investment to make targeted vocational training courses free for all ages, not just school leavers.

This will go towards courses linked to industry needs such as agriculture, manufacturing and building and construction as well as vocational courses like community health, counselling and care work.

There is also a specific $50 million fund for Māori apprentices and trades training.

The Government has not committed to restoring post-graduate students’ eligibility for the student allowance despite the Labour Party promising to do so if elected in 2017.

Additionally, the Fees-Free programme remains unchanged despite some commentators saying it will assist with the costs of retraining.

Jobs and unemployment

A $1 billion Environmental Jobs Package announced in the Budget creates thousands of jobs that will at the same time support habitat protection, pest control and biodiversity on public lands.

Unemployment is set to rise to 8.3% in June 2020 before peaking at 9.8% in September. It is forecast to recover thereafter. Treasury estimates the initiatives delivered in Budget 2020 could see employment rise by 234,00 jobs over the next two years.


The Government will deliver an extra 8,000 new public and transitional houses to help fix homelessnes and reduce the housing shortage. This will take the number of public and transitional houses funded by this Government to approximately 17,000.

Budget 2020 will also ensure an estimated 9,000 additional houses will be well insulated and efficiently heated through the existing Warmer Kiwi Homes programme. An extra $56 million will be invested in the programme which is part of Labour’s Confidence and Supply Agreement with the Green Party.

Support for Māori

The Government will invest over $900 million in its response to COVID-19 to support whānau, tamariki, and the Māori population.

This includes a $200 million Māori Employment Package in which the Government will work in partnership with iwi and Māori to grow job opportunities in the regions.

An extra $136 million has been allocated to Whānau Ora also, and an additional $400 million will be spent on Māori education including $200 million in funding for Kōhanga Reo.


Mō te kaituhi:

Annabel McCarthy | Te Whakatōhea

Aotearoa Student Press Association / Salient


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