Robertson confirms fourth wage subsidy round, hints at more help for hospitality

Wednesday, 29 September 2021

Finance Minister responds to concerns Auckland businesses 'running out of cash'.

A fourth round of wage subsidies will open for applications on Friday and another round of Covid resurgence support payments is on the cards, Finance Minister Grant Robertson says.

Robertson also indicated there was chance the hospitality sector could receive additional support.

The likes of accommodation businesses and restaurants lost about three-quarters of their revenues overall at level 3 and remained about 30 per cent down at level 2, he said.

He and other ministers were having “ongoing discussions with hospitality, restaurant-type peak bodies to talk about what might be possible in the future”, he told Parliament’s Finance and Expenditure select committee on Wednesday.

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The decision to offer businesses further wage subsidies does not appear to have any implications for the Government’s decision on alert levels on Monday, as they would be triggered by Auckland remaining at level 3 during the seven days until midnight on Monday.

Talks with the hard-hit hospitality sector over the possibility of further help are ongoing, Finance Minister Grant Robertson says.

The subsidies will be available to businesses across the country that experience or expect a 40 per cent drop in revenues during the fortnight to October 11 as a result of Auckland being at level 3.

A further round of the separate resurgence support payments would be triggered by a region remaining at level 2 beyond midnight on Tuesday.

Those payments are mainly designed to help small firms that have been impacted by Covid restrictions meet their fixed costs.

“We've got a further resurgence support payment assuming we have a region at level two, which is pretty likely,” Robertson said.

He defended the level of support the Government was providing to businesses.

Responding to concerns from National Party shadow treasurer Andrew Bayly that businesses impacted by Covid restrictions were “running out of cash”, Robertson said the Government had to strike a balance.

“The approach that we've taken from ‘day one’ is that the Government will step up and support businesses.

“But no government has ever been in a position to be able to pay the full costs that businesses are facing,” he said.

The best outcome would be to get on top of the Delta outbreak and for the country to returning to working the way it was before August 17, Robertson said.

But predictions about how strong the economic “bounce back” would be after restrictions ended were hard to make and would be influenced by the global economy, he said.

Robertson suggested that the Government might only be able to gradually reduce its debts level after an expected peak in 2023.

“The direction of travel down from there might not be at the velocity that some people including the Act Party might like.

“But our view is the balance that we have got to strike between getting to a more sustainable fiscal position while still supporting and funding public services and the ongoing Covid response means it will be a gradual move back.”