Finance Minister Grant Robertson told the Finance and Expenditure committee that the economy was well-positioned to deal with the Delta outbreak and the lockdowns.
Finance Minister Grant Robertson has said a review of the economic response to the latest outbreak of Covid-19 will be "considered" when the current phase of the outbreak is over.
Robertson had already received advice on the latest lockdown from Treasury, which warned that more support might be needed ifthe lockdown lasted longer.
Asked by Green MP Chlöe Swarbrick whether the Government had done any internal reviews of the economic response to Covid-19, Robertson replied that a "more comprehensive evaluation" of the economic response would "be considered once we are beyond the current phase of the pandemic, when more data should be available about the impacts of the measures."
Robertson said that "lessons from earlier alert level 3 and 4 periods have informed Treasury's advice to me during the current and earlier periods of alert level increases throughout the course of the pandemic".
Robertson said the settings of the Wage Subsidy Scheme, which had been altered since the first lockdown to reflect inflation and to tighten up eligibility criteria.
Roberson said he had received economic advice on the latest lockdown from Treasury, which suggested that "a longer lockdown could increase the need for other types of support, including for vulnerable communities."
Robertson's answers come from written questions from the Finance and Expenditure Committee.
Swarbrick has been critical of the amount of monetary support provided to the economy by the Reserve Bank, which has had the effect of pumping up the housing market.
She and the Greens think more economic support should come from the fiscal side of the equation - meaning the Government supporting the economy through its own spending, rather than relying on the Reserve Bank.
Swarbrick asked whether Robertson felt that the right balance had been struck between fiscal support provided by himself and monetary support provided by the bank.
Robertson defended the Bank's actions, saying it had helped stabilise financial markets and supported demand "by providing affordable access to credit for households and firms."
However, he did not answer whether the appropriate balance had been struck.
Swarbrick asked whether Robertson was concerned about the "distributional impacts" of the economic response to Covid-19, and whether these impacts had helped make the rich richer and the poor poorer.
Robertson said he was concerned about these impacts, and said the Government had responded to them with things like increases to main benefit rates and the winter energy payment.
"We will continue to monitor and mitigate these impacts by providing additional support to these communities as required," he said.
"I am aware that the response has to work equitably for all of our communities. Iwi, Māori and Pacific communities have been very active in responding to the needs of their communities," Robertson said.
Swarbrick said the Government has "known for nearly two years now" that the monetary policy pursued by the Bank would have "distributional impacts".
"Treasury knows, and have admitted, that there's a critical role for fiscal policy in mitigating that exacerbation of inequality,"
"What this comes down to is a political decision to keep hands off the wheel and allow the poor to get poorer and the rich to get richer," she said.
The Government is on the verge of passing the 2021 Budget in Parliament this week. It also this week began the process of voting itself additional money in case it was required.
This is known as imprest supply. It gives the Government $24 billion of day-to-day additional money and $15b for investment in long-term infrastructure.
The bill will give the Government the ability to spend that money, should it wish to, but it does not mean the money will be spent. The most likely area where the money would go is to things like wage subsidies for future Covid outbreaks.
