Wage subsidies have been a 'life line' for Invercargill business owner

Tuesday, 22 September 2020

The Seriously Good Chocolate Company owner Jane Stanton says the Government wage subsidies have helped to keep her business operating.

Jane Stanton refuses to think what could have happened to her business if the Government hadn’t given wage subsides.

The subsidies received by Stanton enabled her to keep staff at her business, The Seriously Good Chocolate Company, in Invercargill.

“[The wage subsidies] stopped us from … who would have known what could have happened [without it].

“It was a life line.”

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The Government's wage subsidies have been a big help to The Seriously Good Chocolate Company, staff members from left, Moana Karauria, Raphael Rausch, Nikita Curtis, Jin Liu, owner Jane Stanton and Heather Soper.

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The company received a total of $127,812, the Work and Income Covid-19 wage subsidy employer search shows. The amount was made up of the first subsidy, the wage subsidy extension and resurgence wage subsidy.

The first wage subsidy was from March 17 to June 10, the extension payment was available from June 10 to September 1 and applications for the resurgence wage subsidy were from August 21 to September 3.

Under the wage subsidy scheme they do not have to be paid back.

Nationally, 756,649 applications have been approved to businesses, and $13.9b paid out in total between March 20 and September 11, Ministry of Social Development data shows.

The ministry was unable to provide the number of Southland workers who received subsidies or how many employers applied for it.

However, the ministry says 59 per cent of Southland’s workforce have been supported by the first wage subsidy, with the figure dropping to 10 per cent for the extension.

The $780,000 in subsidies given to the Mataura Licensing Trust was a “massive helping hand”, general manager Mark Paterson said.

“It allowed us to keep all staff and pay them fully.

“We would have been in trouble and posting some horrible numbers if we didn’t have the wage subsidy.”

The trust was still able to support community groups and projects with some funding from its profit and loss account, Paterson said.

He declined to comment on whether the trust would repay any of the subsidies back to the Government as others had.

Invercargill Licensing Trust chief executive Chris Ramsay said the organisation had no plans to pay back its subsidy of $3.6 million.

”We’re in the industry that has been hardest hit by this situation and to be perfectly honest we’re not out of the woods yet as the yo-yoing between alert levels, that’s occurred over the past month, has proven.

“So, we need to make smart decisions for the benefit of our employees and the people of Invercargill because, obviously all our profits are returned to the community, so at this stage we won’t be paying it back.”

Most of the country moved back into alert level 1 at 11.59pm on Monday after being in alert level 2 since August 12. Auckland remains in level 2.

In May, after the country first moved into level 2, Infometrics senior economist Nick Brundson said Southland wasn’t faring as bad as some other regions because of the lockdown.

However, at the time, he predicted 5050 Southland jobs would go because of the pandemic.

'This is obviously an unprecedented situation and our knowledge and understanding is going to continue evolving, but we have a reasonable level of confidence in what we think is going to happen in the next year.'

There would be differences across the region, and losses would be more concentrated around Te Anau and Milford Sound, but more rural districts like Gore and northern Southland might not feel it so much, he said.