COVID-19: Businesses warn lockdown will be 'incredibly challenging', call for more support

The recently-announced lockdown will cause pain for businesses despite the availability of government aid.

New Zealand's first community case in months forced the country into alert level 4, which means businesses are closed except for essential services such as supermarkets, pharmacies, medical clinics, and petrol stations.

Speaking after the lockdown announcement Minister of Finance Grant Robertson said the Government is going to trigger support for workers and businesses.

Businesses that experience at least a 30 percent drop in revenue can apply for the COVID-19 Resurgence Support Payment (RSP), which is available to help support businesses or organisations due to a COVID-19 alert level increase to level 2 or higher.

Eligible businesses and organisations can apply to receive the lesser of:

  • $1500 plus $400 per full-time equivalent (FTE) employee, up to a maximum of 50 FTEs
  • Four times (4x) the actual revenue decline experienced by the applicant

There will also be a wage subsidy for Auckland and the Coromandel if businesses expect a loss of 40 percent or more. Businesses will be eligible for up to $600 per week per full-time employee. Wage subsidy applications will open this Friday.

Restaurant Association CEO Marisa Bidois said the snap level 4 lockdown is challenging but inevitable.

"We are feeling for hospitality businesses who once again will pay the highest possible price to protect the nation from an outbreak of the delta variant," she says in a release.

"Lockdown is incredibly challenging for the hospitality industry and in respect of a level 4 lockdown, gives them no opportunity for revenue."

Bidois says there is general support from members for a focused lockdown in one area as opposed to months of restricted trading. However businesses would like more "targeted fiscal assistance".

"Whilst the wage subsidy is appreciated and obviously gives employees certainty, we would like to see more support for business owners by way of targeted fiscal assistance to help them cover their fixed costs."

The lockdown has forced the cancellation of  New Zealand Fashion Week, which has been postponed due to COVID-19 restrictions.

"It's disappointing for our designers who have put so much work into the shows to be presented next week, buyers, production teams, models, partners and all New Zealanders that we've had to postpone New Zealand Fashion Week because of the immediate lockdown. Of course, health and safety must come first and we respect the decision made by our Government," said managing director and founder of NZFW Dame Pieter Stewart.

"The reality is, we were always alert to the likelihood of another lockdown and are now actively working through the options of hosting this iconic event as soon as possible. We will be in a position to share further details once we have made a decision."