COVID-19: Hospitality sector says financial support encouraging but could be too late for some businesses

By Niva Chittock of RNZ

Decimated after two years of Covid-19 restrictions, the hospitality sector describes the latest financial support being offered by the government as encouraging but too late for some to survive.

Eligible businesses will get $4000, plus $400 for every full-time employee - up to a maximum of $24,000 - if they meet the criteria.

The scheme begins on 1 March and will last for six weeks, although the government said it was open to extending the time frame.

John Lawrenson is the chief executive of the Lawrenson Group which owns seven bars and restaurants across Tāmaki Makaurau and Hamilton.

He was relieved to hear news of the payment, although he wondered if a targeted package would have been better.

"Certainly those of us in the hospitality industry have been looking enviously at the likes of the arts sector and the media and the targeted packages they received. Could something have been done that was a bit more tailored?

"Because there are businesses that are down 100 percent right now. If you have an events venue or a night club, you're not even open at the moment."

It has been a long two years for Krishna Botica, group director of four restaurants in Auckland's central city.

She was grateful for the support package, but said it was long overdue.

"I'm relieved, definitely relieved there is some help that has come through. It is overdue for restaurants such as ours that are in the CBD and have had a severe drop off ... well ever since the 20th of January, really."

Hospitality New Zealand chief executive Julie White said it was the devil in the detail that mattered for hospitality and accommodation businesses.

"The reality is, due to the technicality on some of the reference weeks, some may not even get any payments. The average payment, really, for most operators, will only be around $7000."

White said this was because on average, hospitality businesses only had seven employees.

New Zealand Restaurant Association chief executive Marisa Bidois said it wanted the support to cover more than just six weeks.

"We had initially pitched that our businesses would need three months of financial support to see us through this dip in customers due to Omicron."

Queenstown has been heavily impacted, and Chamber of Commerce chief executive Ruth Stokes believed businesses needed more than just money.

"We would like some more certainty over what is to come. It's a bit more one slice of the salami at a time and we really want to hear that there is a plan out, not just a plan for the next few weeks," Stokes said.

"Businesses don't want handouts, businesses want to be in business."

Krishna Botica said there was one thing people could do to ease the stress a little.

"We're absolutely desperate for customers on Sundays, Mondays, Tuesdays and Wednesdays ... If anyone is feeling nervous about being in crowded spaces, then come out on those nights because we can only earn so much with restrictions in place on a Friday and Saturday and it's certainly not enough to keep our staff on 40-hour weeks ... so please come out."

John Lawrenson said the current 10-day isolation period was crippling and hospitality businesses were already folding because of it.

"I'm a business owner who is lucky enough that I will probably make it through this, but I already have friends contacting me saying that they are closing down or selling businesses and they just know that there is no point trying to continue, even with the help that they're getting now - it's just too little, too late."

The hospitality sector lost around $2 billion due to the Delta outbreak and Omicron is expected to be the same.