Lockdown Benefits? - Government plans Financial Support for Businesses in advance.

With two recent probable cases confirmed in New Zealand yesterday, we all are hoping for the best and definitely not another lockdown.
But should there be a lockdown, do not worry as Government has already kept a Plan of Action ready to launch to support NZ Businesses.

According to Stuff’s article on 26 January, Finance Minister Grant Robertson has set out the assistance that would be offered “next time around” before Christmas. He also projects that these new supports would be particularly useful to the hospitality businesses.

If the country or any region needed moving back to Level 3 or 4, there would be a revival of Wage Subsidy Schemes along with introducing new support for businesses.
The Subsidy will be available for 2 weeks, paid as a lump-sum at a flat rate of $585.80 for each full-time employee and $350.00 per part-timer.

However, businesses would only be entitled to wage subsidies if lockdown alert level 3 or 4 lasts for more than a week.
When the government introduced the subsidies last year, initially every business applied for the loans whether they were affected by Covid or not. But later on, terms and conditions were announced that if a business or not for profit organisation suffered a decline in revenue by 30%, they would be eligible for the loans. Click here to check Eligible businesses and organisations.

But it is said that the government will not hold back in helping out the businesses just like last year. The most recent update on the eligibility of loans in terms of revenue drop was a 40% decline caused by the lockdowns which would still be valid this year; but the only difference is that eligibility would be “based on comparing fortnightly revenues with those during the six-week period preceding the lockdown, rather than the previous year”. Moreover, the businesses would need to keep a record of their revenue drop, that it has been due to the impact of Covid-19 also this will be verified later on.

The Government has $10.3 billion left in its Covid-19 Response and Recovery Fund to help pay for the measures and believes that would be enough to meet the cost of “multiple resurgence events”.

Robertson has also promised new support for businesses in the event of a move back into alert level 2.
A one-off cash grant of $1500 plus $400 per employee, capped at $21,500 per business, would be offered to firms that suffered a 30% drop in their fortnightly revenues due to level 2.

These resurgence support payment plans haven’t been passed yet by the Parliament but the government states that if these supports are needed earlier, it would be legislated based on the situation.

Businesses would also be entitled to a new one-off “short-term absence payment” of $350 per eligible employee if they had workers who had been ordered to stay at home while they waited for the result of a Covid test and who couldn’t work from home.
That would be in addition to the existing Leave Support Scheme that provides businesses with support if staff need to self-isolate after a positive test.