A leading economist says an extra public holiday would only work if businesses were subsidised by the lost working day. 

The Prime Minister wants to hear what businesses think about creating a new public holiday.

Jacinda Ardern says the government looking at a range of different options to boost the tourism industry, with an extra public holiday a possibility. 

However, the idea has sparked complaints from small business owners, who say they couldn't afford it. 

Infometrics Senior Economist Brad Olsen told Simon Barnett and Phil Gifford the idea could boost tourism spending.

However, it could also be the straw that broke small businesses backs. 

"Businesses are already under a huge amount of pressure. They are still struggling, even at level two." 

Olsen says if the Government is willing to fund it, that could be one way to get around it.

"Last weeks budget didn't deliver a lot for small businesses, so I think the Government would have to come to the table with something to look at."

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