Almost 400 Wellington restaurants face closure following coronavirus pandemic

Thursday, 9 April 2020

A Restaurant Association of New Zealand survey found 20 per cent of its members thought they would close for good because of the coronavirus pandemic.

Almost 400 Wellington restaurants and cafes could face closure because of the coronavirus pandemic, a business owner says.

Beach Babylon and LBQ owner Maura Rigby told Wellington City Council on Thursday that one-in-five New Zealand hospitality businesses expected to go bust because of the global pandemic.

The numbers were based on a recent Restaurant Association of New Zealand survey and, if true, would result in hundreds of capital cafes and restaurants closing. Not all hospitality business are members of the association, meaning the actual number could be higher again.

Rigby said: 'The restaurant association's recent survey estimates that a fifth of their members are considering closing their businesses for good, or believe the crisis will put them out of business.'

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A fifth of Wellington hospitality businesses, about 374, could shut their doors for good, LBQ owner Maura Rigby says.

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'A fifth of Wellington's hospitality businesses would be 374 businesses shutting their doors for good.'

As the tourism industry takes a massive hit from the Covid-19 crisis, some high-end lodges are now looking to target more of the domestic market in order to keep the doors open. (First published April 9, 2020)

Rigby made the comments during a council meeting to discuss its proposed pandemic response plan aimed at supporting businesses and residents throughout the crisis.

An online petition started by Rigby calling for more local government support for the hospitality sector during the pandemic had attracted more than 2000 signatures.

Rigby told the council its initiatives to help the business community in its response plan did not go far enough.

'While well-intentioned, the immediate measures outlined within your agenda equate to less than $1000 of direct financial relief to licenced hospitality businesses, and less to non-licenced businesses.'

The council's pandemic response plan proposes initiatives such as cutting food and alcohol licence fees for many businesses, deferring rates bills, and offering alternative rent payment options.

But now was not the time to 'tinker round the edges', with the economic impact on businesses likely to be far greater than proposed fee reductions rates cuts, Rigby said.

The council also agreed on Thursday to propose two rates increase options in its draft annual plan which will go out for public feedback.

They were a 4.95 per cent increase or a 2.15 per cent increase.

It had proposed to introduce free parking across the city for up to six months, but voted on Thursday to change that.

It would instead reinstate fees two weeks after the country dropped from alert level four to alert level three.

The subsequent revenue of up to $1 million would be directed towards community grants, bringing total additional grant funding to $1.5m.

Council officers would investigate introducing 15-minute parking spots around the city for pick-ups.

The council also agreed to redirect $8m initially set aside for marketing and events to job creation through innovation and technology.

AT A GLANCE

Wellington economic recovery plan

Rates

Commercial ratepayers, excluding those who accommodate government workers, can defer their final 2019-20 rates bill for up to six months, without charge.

The full amount, including interest of about 2 per cent, must be paid back, and economic benefits must flow through to tenants.

Residential ratepayers can also qualify for the deferral, pending an application.

Rent

A range of rent relief and payment options have been proposed for organisations, businesses and clubs that use council facilities.

They will be in place until the end of June, at a cost of $2.8m, and could be extended if needed.

Food and alcohol licences

Annual registration and renewal fees for food and alcohol licences have been cut to $1 for the final 2019-20 quarter.

Inspection fees for businesses which open before July 1 have also been set at $1.

Businesses that have already paid fourth quarter fees will be refunded. Fees must still be paid to the Alcohol Regulatory and Licensing Authority.

Parking

Fees and fines for city and coupon parking have been removed until two weeks after New Zealand drops to alert level three..

Time restrictions will remain in place.

Resident parking and loading zone permit fees still apply.

Community sector support and grants

The council will continue to provide financial support to organisations in the arts, culture, and sports sectors through grants and sponsorships.

The funds will come from existing grants for the rest of the 2010-20 year.

Other fees

Consent fees for halted projects will be refunded, and council pool and gym memberships will be frozen.

Library fees will be waived until after the lockdown.