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In announcing the funding today, Sports Minister Grant Robertson said the coronavirus had resulted in much of the sector's funding dry up and has put sports - particularly at a community level - under immense strain.
"We have also seen many of our professional sports and athletes struggle as competitions have been cancelled or suspended. Budget 2020 will provide some assistance, so they can keep competing."
He said the funding would allow sports at all levels to remain viable, get stronger and adapt.
"Sport New Zealand and High Performance Sport New Zealand will work closely with national sport and recreation organisations, as well as the professional teams and clubs to ensure the new funding is allocated fairly and appropriately across the system."
How the money will be spent
• $83 million in short-term support to help sport and recreation organisations at all levels get through the initial impact of Covid-19.
• $104 million to help the sector rebuild in the medium term including so national and regional sports organisations can make changes in order to operate successfully in the post-pandemic environment. This will include supporting new operating models and more collaboration.
• $78 million for innovative approaches to delivering play, active recreation and sport into the future. The world is changing, and this funding will help us use new technology and research in the rebuild from Covid-19 to modernise the sporting sector.
Robertson said across all those areas, the Government would provide funding for women's sport and groups who are currently under-represented in sport like people with disabilities, Maori and those from low socioeconomic groups.
The sport and recreation sector contributed about $5 billion a year to New Zealand's GDP and employed more than 53,000 people, he said.
All levels of organised sport have been on hold since March when New Zealand went into a national lockdown to attempt to contain the spread of the disease, restricting exercise to walking, running or cycling alone.
The Government loosened restrictions in April and then eased them further on Thursday, allowing the resumption of professional sport, although fans will not be able to attend matches.
Community and club sports competitions are still on hold, with organisations told by government body Sports NZ to enter a "get ready" phase to prepare for a return.
Health officials reported one new coronavirus infection on Sunday, bringing the total to 1499, of which 1149 are confirmed. Only 45 are still considered active cases.
There have been 21 deaths from Covid-19, the disease caused by the new virus.
- RNZ and Reuters