For the third time in the past decade, the government is directly subsidising wage earners to get them through a tough patch. The Covid-19 wage subsidy scheme though dwarfs the previous two schemes that were implemented post the Christchurch and Kaikoura earthquakes: some figures put the number of New Zealanders supported under the current scheme at two-thirds of the workforce, almost a million and a half Kiwis.

There is a better way to support those going through a tough patch, and business experiencing a severe downturn, and one that will help with the recovery.

Unprecedented is a threadbare word these times, but it does describe the current situation very well. We are in new territory. Meanwhile, the state’s liabilities - and therefore future liabilities for all New Zealanders - have massively ballooned.

Our fortunate position of having a low public debt to GDP ratio, built up over a generation since the 1990s, is at risk of disappearing as we find a way through the current crisis. The resurgent ACT party has proposed a national insurance scheme but sorely focused on replacing the unemployment benefit.

Many of us are looking at our KiwiSaver accounts for financial hardship payouts. Most Kiwis are finding that KiwiSaver was never really meant for hardship. It is, after all, a retirement saving scheme. Given that the KiwiSaver “infrastructure” exists, and given that we need to find a better way to help people through tough times without depending on previous governments to keep public debt low, an entire scheme should be constructed.

A national insurance scheme that, much like KiwiSaver, we contribute to through our pay packets.

National insurance policies could be created alongside KiwiSaver accounts, for the purposes of financial hardship. That would cover the loss of employment outright as you would expect. Or, when your employer is unable to trade, due to a declared natural disaster or state of emergency.

In other words, you could still be in employment but due to an earthquake wiping your employer’s business out, your national insurance would start paying out, ensuring your employer could stay in business. The corollary to this is your employer, just as with KiwiSaver, would make a contribution to your national insurance premiums.

And like KiwiSaver, the taxpayer would kick-in a contribution as well. The taxpayer could also underwrite the insurance, to incentivise providers to enter the market.

In the United Kingdom, employment insurance schemes were first introduced by trade unions as a means of supporting their members. There’s no reason unions couldn’t be a part of a national insurance scheme here. Not quite the Ghent system, but a useful means for increasing social utility in times of economic downturn.