15 Oct 2021

'On the verge of falling over': Latest round of wage subsidy scheme opens

8:36 pm on 15 October 2021

Another round of the wage subsidy opened today, with Auckland in its ninth week of lockdown and businesses warning they can't hold on much longer.

Customers queiung for takeaways at Olafs Cafe. Mt Eden, on Auckland's first day of level 3 after five weeks of lockdown.

Photo: RNZ / Jean Bell

Covid-19 cases are ballooning, first doses vaccinations are stalling and the new reality is sinking in that it's likely to get a whole lot worse before it gets better.

To ease the economic hardship lockdown inflicts, more than $3 billion has already been dished out since the Delta outbreak began.

About $1b has gone on the resurgence support scheme, contributing to businesses fixed costs, like rent.

But Business Manukau general manager Kerry Burridge said the government subsidies were just a drop in the bucket.

"So the businesses, many thousands of them, are on the verge of falling over - they need more help," Burridge said.

"What's been provided is not going to be enough unless we can open up and get a lot more customers quickly."

Lots of businesses had closed already, and many landlords have been cutting rent deals with tenants and have no buffer left, she said.

A rent rebate or subsidy must be put on the table, Burridge said.

"The coffers of the landlords have run dry in the main, they are really suffering financially and are struggling to pay their mortgages.

"And we have businesses who can't afford to pay their landlords because, as you can imagine, for most of them, then their rent or lease costs are their biggest outgoing, and it's just crippling them.

"If they haven't got income coming in, they can't keep going."

The only way forward was if everyone did their bit and got vaccinated, she said.

Stefan Crooks owns the Westie Food Group, which makes pre-packaged food and meals and employees more than 200 staff.

He painted a bleak economic picture since Covid-19 virus swept the globe.

"Simple facts, 25 percent of the total New Zealand market disappeared, for whatever reason, whether it be international students, whether it be tourism," Crooks said.

"So 78 weeks of trade since Covid began last year, and we've lost 31 weeks of trade. That's just not sustainable."

As the chair of the Rosebank Business Association, Crooks said not knowing what the future held plagued his members.

"Dart players go to a board with three darts and they throw at numbers. We're going to a dart board with no darts and no numbers because we don't know what we're aiming for.

"So to even try and work out how we're going to survive for the next two weeks alone, the next six to 12 months, we just don't know what we're aiming for."

There's wide support for mayor Phil Goff's call to the Government for more targeted support, but no word on any developments.

Financial advisor Bernie McCrea from Abbott Insurance Brokers in the Auckland suburb of Avondale said you had to give credit to the talent and resilience of businesses.

"Congratulations to the businesses for getting this far and they deserve a lot of recognition and credit, keeping employees going, doing what they can. They're really skilled to actually do that."

Cabinet will look at the alert level settings on Monday.

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