"There is no silver bullet" - Deloitte CEO Thomas Pippos chats with Liam Dann on what to expect from the Budget 2020
"I'm not looking for a big bang," says Deloitte NZ chief executive Thomas Pippos of this week's Budget.
"There's no silver bullet here. What I'm looking for is greater clarity as to the way forward and an acceptance that the government and private sector will have to be working togetherto navigate through the challenges."
Pippos believes it is still too early for the Government to get specific about plans for spending the billions it has up its sleeve to steer the economy through the pandemic.
"I don't want to see anything precipitous," he said.
"The dust is still to settle on what the economic environment will be like at level 2 and level 1, until that dust settles it's important that we don't get too ahead of ourselves."
When it came to specific initiatives it was "not clear how much is needed and we're not that clear on what is exactly going to be needed and when".
Those still under material stress would be looking for immediate help.
While those that have been able to weather the lockdown would be looking for greater clarity about the path ahead.
There might be a case for looking at the emergency support measures like the wage subsidy, he said.
That had been designed with an emphasis on "speed over elegance".
So if the Government was looking to extend those measures they would likely be more targeted, he said.
Pippos said he had been getting some positive feedback from many businesses about the outlook.
"So far most of the commentary has been led by economists and they've had a field day in terms of misery loving company," he said.
Outside of hospitality and tourism, which had been most badly hit, there were many other businesses that had been able to hibernate through this period.
"There are lot of businesses that are cautiously optimistic about how quickly they'll be able to come back."
Thomas Pippos, chief executive of Deloitte New Zealand. Photo / Jason Oxenham
He was wary of the Government getting too hands-on running the economy.
Markets needed to find their own equilibrium, he said.
"The role [of Government] is to help markets find equilibrium in an orderly fashion.
"That's what wage subsidies and other schemes are designed to do. To ensure there is an orderly transition from a pre-Covid world to a post-Covid world from an economic perspective."
The response from here would have to measured and focused.
"It's sector by sector and also region by region," he said.
The Government needed to support the most vulnerable and also encourage those companies coming through "to come through quicker than they might have".
"It's quite a complicated equation," he said.
A long period of economic stability had allowed successive Governments "to take the economy for granted".
That strength and stability had enabled various initiatives like the "wellbeing" focus.
"I think what Covid-19 will do is force us to focus back on the economy which is ultimately the bedrock from which a lot of other change is built," Pippos said.
"So I'd expect the budget coming through to have a heightened focus on the economy.
"Until we get the economy in a position that we're all comfortable, we're limited in terms of what we can do thereafter."
