Finance Minister Grant Robertson has revealed the Government will be running deficits for an "extended period" of time and its debt levels will reach an all-time high.
When Tennessee Teddy and Donna Seal opened their business at the end of last year they had no idea they would be fighting for survival months later.
The pair's small owner-operated business, Lady Marmalade Eatery, like many others has struggled since they were forced to temporarily close their doors whenNew Zealand went into alert level 4 lockdown in the fight against Covid-19.
When restrictions eased under level 3 they were able to reopen for contactless food and coffee orders and while they had received a lot of support from the community, which the pair were grateful for, their operating hours had halved due to a decrease in demand.
Under level 2, Teddy said their struggle would only get worse.
"For us, it's one day at a time. We are in survival rather than surviving," Seal said.
Lady Marmalade Eatery is based in a small cottage in 2nd Ave. It shares the space with a retailer, which meant they would not be able to provide the 2m space required between tables for social distancing.
"Level 2 for us will be harder than Level 3. Purely because we are such a tiny establishment we are unable to offer social distancing within our cafe, so we will have to remain 100 per cent contactless and solely takeaway whereas larger places are able to offer people the place to sit and enjoy while social distancing due to having the larger space to do so," Teddy said. • Covid19.govt.nz: The Government's official Covid-19 advisory website
"With level 3 all cafes are on the same playing field but with level 2 we are at a disadvantage solely due to space," she said.
Lady Marmalade Eatery owners Donna Seal and Tennessee Teddy are operating in survival mode. Photo / George Novak
When the Government announces its Budget for 2020, Seal and Teddy hope it includes a generous package to support businesses' cashflow to ensure survival.
"We feel any help given by the Government would be very much appreciated by any business during these uncertain times, a lot of businesses won't survive without government help, as to whether this is us or not ... only time will tell."
Tauranga's business leaders agree, saying business owners desperately need the Government to provide some added relief to ensure their survival.
Tauranga Chamber of Commerce chief executive Matt Cowley said the biggest issue Tauranga businesses were facing was that their customers' needs and behaviours had changed but the businesses had little cashflow to make the changes to adapt.
"Funding is also needed to support businesses to become stronger, modern businesses. We need to upskill many business owners and managers to thrive in the new business world, which is changing faster than ever," Cowley said.
"Many businesses will be selling equity or taking on loans to help fund changes to their businesses to survive post-Covid-19," Cowley said.
For businesses to survive, he said the Government needed to invest in infrastructure and support business cashflow.
"The region needs to address its infrastructure deficits. This should not just be government-funded, but government help is required to set up private-public partnerships.
"I would also like to see innovative ways for the government to defer, finance or reduce small business tax requirements over the next 12 months to support business cashflow."
He was confident the budget would "exceed most people's expectations".
"The biggest issue will be whether we have enough skilled labour and resources to implement it all."
Priority One chief executive Nigel Tutt said Budget 2020 allocations for the business sector needed to match the massive response to the Covid-19 health crisis, with "a good mix of business support".
Ideally, the Government's Budget would reveal extended wage subsidies, support for leases, commercial landlords and tax breaks as well as investment into infrastructure and local projects that will alleviate pressure in other areas.
Tutt said opening up the Tauriko West subdivision would not only create jobs and help boost the economy, but could also alleviate social housing issues.
He said the business sector would be facing difficult times for the foreseeable future.
