Newer firms no longer shut out from resurgence support scheme

Friday, 3 September 2021

The Government will relax the criteria for claiming Covid resurgence support.

Businesses will only have to be one month old, rather than having been set up at least six months ago, to claim Covid resurgence support payments, Finance Minister Grant Robertson has announced.

The scheme lets businesses claim a one-off payment of $1500, plus $400 per employee, capped at a maximum payment of $21,500, if they experience a 30 per cent drop in revenues over a week, as a result of Covid alert level restrictions.

However, Robertson reiterated the Government had no plans to resurrect a mortgage holiday scheme that would let homeowners defer making mortgage payments, saying it would continue to leave any such support to individual banks.

At this point, banks reported that there was no need for a government-backed mortgage support scheme, he said.

* Government opens Covid-19 resurgence support to help businesses cover costs

“This kind of scheme is only necessary to protect the overall banking system if there were thousands of applications for mortgage deferral,” he said.

“Otherwise, in ‘peacetime’ as it were, these can be dealt with by banks themselves.”

Robertson says mortgage deferrals can be left to the banks.

Robertson said the Government had decided to amend eligibility for Covid resurgence support payments after agreeing with businesses and MPs that the existing rules were too restrictive.

As of Thursday, Inland Revenue had approved more than 147,000 applications for the support totalling $454 million, he said.

“This is a payment that is provided to help businesses meet fixed costs, such as rent, during alert level rises.”

Revenue Minister David Parker said firms that newly qualified for the support would be able to apply for it from 8am on Thursday.

Wage subsidies remain the main tool that the Government is using to support businesses and any employees they might otherwise make redundant.

So far, 242,600 applications worth $998m had been approved under that scheme, Robertson said.

He hinted at the possibility of further support.

“We will continue to monitor and assess the support that is available for businesses and workers to help them through these uncertain and volatile times,” he said.