21 Feb 2023

Cyclone Gabrielle: Multiple support packages for businesses likely - PM Chris Hipkins

11:22 am on 21 February 2023
Prime Minister press conference in Gisbourne

Photo: RNZ/ Nate McKinnon

Prime Minister Chris Hipkins is not ruling out providing wage subsidies for businesses that have been hurt by Cyclone Gabrielle.

Hipkins told RNZ's Morning Report no form of support would be taken off the table at this stage.

On Monday, Hipkins and Finance Minister Grant Robertson announced a $50 million support package to provide immediate relief for businesses hit by Cyclone Gabrielle.

An additional $250m has been ringfenced to top up the National Land Transport Fund's emergency budget to repair crucial road networks.

The extent of the damage and impact on businesses would be highly variable, as would the time to get them back up and running, Hipkins said.

"So we want to make sure that we're providing the support to those who need that support the most."

There was likely to be multiple businesses support packages responding to the different needs and communities, he said.

"We've just got to shape up the details with local government and local business representatives.

"We're dealing with a highly complex situation where the scale of the need is clearly quite significant so I'm not ruling things in or out...

"The government has options, we have very low levels of relative debt to other countries, we're in a good financial position to do that, to be able to support New Zealand to recover from this."

The details on the support for farmers and growers would be released by MBIE on Tuesday, he said.

"The issue for how we pay for all of this in the medium term will certainly be front of mind in the Budget, it's not something we're going to make immediate overnight decisions on."

People who have homes or businesses in areas where rebuilding isn't a good idea would need to be supported, Hipkins said.

National Party leader Christopher Luxon said the government needed to urgently provide more detail about who would be eligible for the financial support and under what conditions.

"People want to know whether they will actually get paid if they turn up to work tomorrow and the government, frankly, hasn't provided that clarity," Luxon said.

He said it was "disappointing" and "concerning" that affected people did not yet know if they would be eligible.

Luxon pointed to the wage subsidy scheme established four days after the Kaikōura earthquake in 2016 as an example of allocating funding quickly after a natural disaster.

'You can't just have one size fits all'

Gisborne Chamber of Commerce president Belinda Mackay said businesses wanted a flexible pool of funds.

"Business were saying they needed assistance in terms of wage assistance, to pay immediate staff salaries, so I think this will be great for business.

"It will get them to be able to carry on for the next wee while, while we rebuild essentially," Mackay said.

Businesses were already doing it tough during the pandemic and more assistance would be needed pretty quickly, she said.

"We're also going to need some timings around ... roading infrastructure ... and we need to have some reliance built into our fibre networks. So that's the key things that we're going to be looking for is investment in our infrastructure."

Havelock North farmer Robbie Hill said local knowledge and connection would be key to working out what people would need.

So far, he said, it had been a community-led effort.

"You can't just have one size fits all, everyone has got a different and unique situation that they are dealing with. When you've got that direct connection with these areas, you can actually cater exactly what it is farmers require."

Hawke's Bay Fruitgrowers' Association president Brydon Nisbet said growers need to know as soon as possible how the $50 million government funding, announced yesterday, will be spent.

The funding was a start, "and we're thankful for the start", he said.

"As far as where it's going to go, I'm standing in my orchard now, it hasn't been completely wiped out but it's had half a metre of water go through it and I have 8000 trees in here and the only way I can save this orchard is if I get diggers in here and I've got to scrap the silt away ... from the trunks so that the roots can breathe."

This needed to be done within a few weeks before the apple trees died, he said.

It would cost "a huge amount" - as much as $300,000 to $400,000, he said.

Gisborne horticultural company LeaderBrand chief executive Richard Burke said businesses were all burning their own cash to get things going again.

"It's a hard one for government because trying to get money out fast is a difficult deal to do, and look, we really appreciate the support they're offering but right now it's up to individual businesses to stand themselves up and do what's right for them, both in the short term and the long term."

Trust Tai Rāwhiti (economic development agency) chief executive Gavin Murphy told Morning Report it had been hard without communications and Star Link had been stood up yesterday to allow businesses to do things like payroll and find out about suppliers.

"These businesses are hurting, right now many of them can't trade because they can't use water.

"My view is that the wage subsidy mechanism, which is a tried and tested one, could be put back in place very quickly and could be essential."

Napier City Business Incorporated general manager Pip Thompson agreed and said the wage subsidy needed to be put in place with some urgency.

"A large percentage of businesses in Napier CBD are locally owned and operated and they don't have the fat in the system like the big players have so without a doubt, that needs to be injected back in our regions."

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