Cash boost for businesses bearing brunt of lockdown

The government is doubling payments to businesses hit by higher alert levels as the country moves to a new system.

The government today announced details of its new covid-19 protection framework that includes migrating to a “traffic-light” system once all district health boards hit a 90% vaccination rate. 

Finance minister Grant Robertson said: “While ongoing restrictions in Auckland are keeping people safe, we also know they have made life very tough for businesses in the region.

“In recognition of that, ministers have agreed to significantly boost the resurgence support payment.”

After the next rescheduled payment on Oct 29 it will move to fortnightly payments at double the current rate, he said.

The first “enhanced” support will be paid on Nov 12.

It will continue to be paid until the new framework comes into play.

Restaurant Association chief executive Marisa Bidois said the move was positive.

“A reopening framework coupled with clear targets and supported with the appropriate financial assistance is exactly what is needed to move forward and get our largest city moving again,” she said. 

Act’s small business spokesperson Chris Baillie also lauded the move. 

“Businesses are doing it tough through no fault of their own and it’s only right that the government has stepped up with further resurgence payments.”

Currently, the resurgence payment is paid at a base rate of $1500 per eligible business and $400 for each full-time equivalent employee (FTE) up to a total of $21,500.

It will now be $3000 per business and $800 per FTE, up to 50 FTEs. This will make the maximum fortnightly payment $43,000.

The estimated cost of providing both the weekly resurgence payment and the wage subsidy is up to $940m per fortnight through this transitional period.

“The enhanced RSP will be available until Auckland moves into the new framework. The wage subsidy will continue to be available on the current criteria while areas of the country are still in alert level 3."

Things will change under the new framework, with the final details still to be worked out, Robertson said. 

As most businesses will be able to operate at all levels of the new framework, the wage subsidy and the RSP will be reworked to a new targeted payment that will come into play at the “red” level of the new framework, he said. 

There will also be a transition payment. During the transition, businesses will also be able to access a $60 million package for business advice and mental health.