Covid 19 coronavirus: Stuart Nash on why Govt is raising minimum wage

Stuart Nash, minister for small business, says the minimum wage rise is the right thing to do. Photo / Warren Buckland.

The Government will plough ahead with an increase to the minimum wage today despite repeated calls from the business sector for it to be delayed.

Stuart Nash, minister for small business, told Newstalk's Mike Hosking that he absolutely believed that raising the minimum wage was the right thing to do at the moment.

"Yes I do think it is the right thing to do....those who get it who are still working will spend it."

Nash said giving those workers on minimum wage more money would help when the country opened back up again and those workers would have money to spend.

The minimum wage is set to rise from $17.70 to $18.90 from today.

But Mark Mitchell, a National party MP, said he believed the wage rise should be delayed by six months.

"The priority for the country is to keep people in work and businesses open and this won't help with that."

Mitchell said the Government should be focused on keeping inflation low, rent rises down and keeping prices on essentials like food and medicine low.

Increasing the minimum wage now would increase job losses and lead to more businesses going under, Mitchell predicted.

"We think it is the wrong decision at the wrong time."

Mitchell said the minimum wage should rise but only when the country could afford it.

"Right now it is the last thing in terms of priorities. We have got to keep people in work at the moment."

Nash said the Government was still looking at a universal basic income which could be paid to all regardless of how much money they earn.

"It is one of the things being thrown around."

But he said any plans around it were not at an advanced stage.

"We have got to look at everything."

Nash said at the moment the Government was providing people with the employer wage subsidy so that people could get through the initial period as well as increasing the minimum wage.

Hosking also asked Nash how the Government planned to work its way out of the four-week lock-down and whether individual industries could be opened up if they followed certain guidelines.

Yesterday former Prime minister Sir John Key said it was harder for the country to get out of a lock-down than to go into it.

Nash said he was writing a very big paper at the moment on small to medium-sized businesses and how it got out of survival stage into the recovery stage.

"There is a lot of very good work going on, a lot of very engaged people who have some innovative ideas."

Nash said there was a plan but he said the major focus at the moment was to avert the sort of disaster that Italy was seeing.

He said the Government needed to look at New Zealand's data and see if the lock-down was working and look at precedents from other countries.

It also needed to test enough New Zealanders to have a statistically valid argument that it was working and that lives had been saved.

"As we get through these different parts of the economy will start to open up."

Pushed for more detail on the plan to get out of lock-down Nash said he would not release the plan at this point in time.

"We do have a plan. There is no doubt about that. But keep in mind this is fast moving. When we make the sort of policies we are talking about it is normally about six to 12 months consultation."

Nash said decisions were being made very quickly and he was writing and researching how to take the right course while minimising the long term cost to the economy.

Mitchell said the Government needed to make quick decisions and give clear information to the public. There had been some confusion about recent announcements, he added.

But he said there needed to be a focus on getting rid of Covid-19 and then getting New Zealand's economic recovery on track.

NeedToKnow3

• Covid19.govt.nz: The Government's official Covid-19 advisory website