As Auckland enters its fifth week under Level 4 lockdown, the Government must present its plan to assist businesses to get through the stringent restrictions, says National’s Shadow Treasurer Andrew Bayly.
“The worst result is for businesses to fail from a lack of cashflow as a result of the Government’s decision to impose crippling lockdowns across the country.
“If businesses do go to the wall then potentially a significant number of people could end up on the jobseeker (unemployment) benefit. Some 50,000 people lost their jobs in the first lockdown and many are still on a benefit.”
Given the potential devastating economic impacts for Auckland, National believes that the Government urgently needs to:
1. Confirm as soon as possible that the Wage Subsidy and Resurgence payments will continue to be paid to those qualifying companies at Level 2.5 or above:
“Clarity is essential to provide confidence to Auckland business-owners that they will receive the same financial support as those businesses currently receive outside of Auckland.”
2. Implement immediately a Business Rental Support package to assist those companies entitled to the wage subsidy:
“Given a prolonged period of lockdown that is tough for many businesses, particularly in the retail and hospitality sectors, tenants and landlords need financial support.
“National’s rental support scheme would mean those small businesses entitled to wage support payments would also receive a 50 per cent subsidy from Government, backed by a binding arbitration process to resolve tenancy issues promptly.”
3. Extend the Covid-19 temporary loss carry-back scheme to apply for the 2022 tax year.
“This is a further way of providing cashflow relief to businesses.”
4. Ensure the Ministry of Social Development processes all wage subsidy payments within three working days for the self-employed and sole traders:
“Significant delays are occurring, particularly for those who are self-employed, which mean people have not received their wage subsidy payments due to administrative and IT issues.”
5. Grant exemptions to Auckland businesses that manufacture critical building products that are supplied to the rest of the country to allow construction projects to progress:
“Clause 29A of the Health Order currently restricts this to coated roofing, plaster and gypsum board and cavity insulation products. It is essential that we allow Auckland-based manufacturers to supply products to construction projects across the country without delay.”
6. Implement a mental health programme for small business owners and their staff:
“Given the significant pressures, we must work with the Business New Zealand network and regional chambers of commerce agencies to deliver this support nationally.”
In the event that that the Government imposes further lockdowns, it must undertake contingency planning now, says Mr Bayly.
“Because of the devastating effects of lockdowns, the Government must agree protocols to allow some of the 250,000 construction and civil contractors workers to operate under a restricted arrangement during further Level 4 lockdowns.
“This would include reduced number of people on sites and regular testing of workers. Building roads and houses is essential during the forthcoming summer months.
“Government also must determine how to allow different areas of cities, such as Auckland, to operate at different levels of lockdown rather than blanket arrangements covering areas unaffected or unlikely to be affected by Covid outbreaks.”
The following organisations have given their support for Mr Bayly’s proposal:
- Auckland Employers & Manufacturers Association
- Hospitality New Zealand
- Restaurant Association of New Zealand
- Franchise Association of New Zealand
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