Hospitality New Zealand Rotorua branch president and owner of Hennessy's Irish Bar Reg Hennessy. Photo / File
Hospitality New Zealand Rotorua branch president and owner of Hennessy's Irish Bar Reg Hennessy. Photo / File
Local business leaders have welcomed the Government's wage subsidy extension with open arms, but some are saying it is not enough to fully weather the storm.
Finance Minister Grant Robertson made the announcement this afternoon, saying it would protect about 470,000 jobs nationwide at a cost of $510 million.
The new wage subsidy was for an extra two weeks past September 1 and applications could be lodged by the end of this week, he said.
Finance Minister Grant Robertson during his announcement over the wage subsidy scheme extension. Photo / File
The criteria were similar to the current extension, but businesses must have had, or were predicting to have, a revenue drop of at least 40 per cent due to Covid-19.
This applied for any consecutive period of at least 14 days within August 12 and September 14 compared to last year.
It comes after a fresh outbreak of Covid community transmission last week that saw Auckland placed into alert level 3, while the rest of the country was upgraded to alert level 2.
Reg Hennessy, Hospitality New Zealand Rotorua branch president and owner of Hennessy's Irish Bar, said while the wage subsidy was great, it would only pay wages for two weeks.
He said the Government urgently needed to consider how businesses would survive with all other costs, particularly commercial rent still hanging over owners.
Last week, some businesses were down between 50 and 60 per cent of their usual income, he said.
General manager of Rotorua Canopy Tours Paul Button. Photo / File
General manager of Rotorua Canopy Tours Paul Button said the extension would "cushion the blow" after the level 2 and 3 announcements last week.
He said Aucklanders were their biggest market and they were expecting a "significant drop" in revenue as the "confidence" was knocked out of the economy again.
Redwoods Treewalk owner Bruce Thomasen said the extension was a "necessary thing" to keep things afloat as they were expecting a "minimum" 50 per cent drop in business compared to June and July.
"Auckland is the engine room of domestic tourism."
Hospitality NZ regional manager Alan Sciascia. Photo / File
Hospitality New Zealand Bay of Plenty regional manager Alan Sciascia said while the extension would be gratefully received by a number of businesses, the support is needed now.
"It's a pity that the Government won't take applications until the end of this week as support is needed now."
Sciascia said many businesses would not be receiving the current subsidy because, until last week, their revenue had not dropped enough to qualify.
"Suddenly revenue plummeted last week but employees are still required to be paid."
Rotorua Chamber of Commerce chief executive Bryce Heard said he would like to see better ways to support businesses moving forward.
"We need to move the support from palliative to remedial. Paying wage support is fine but unless we fix the job situation it is not the long-term solution for job creation."
Destination Rotorua acting chief executive Andrew Wilson said the extension would bring some relief to local businesses and it was great to see the Government responding quickly.
Priority One chief executive Nigel Tutt said while he did not expect the current lockdown would create the need for large scale take-up of the scheme in the Bay, some businesses would be impacted – particularly those that might have been expecting customers from Auckland.
The overall scheme would cost $1.6 billion.
The Government also planned to modify the Covid-19 sick leave scheme to make it more accessible. Details would be announced on Monday.
