Business support packages announced by government – 21 February, 2022
Members will be able to get some relief from a new government support scheme, similar in structure to the previous resurgence/transition support, announced this afternoon. This will go some way to helping however we know that this doesn’t solve all of our challenges and not everyone will be able to access the support – in particular we are challenging the eligibility time frame. The government have indicated the support may be extended if required.
As you’ll be aware, we have been engaging with government over the past 6 weeks, pushing our agenda on behalf of our members and the industry. The support payment was one of the key asks that the Restaurant Association has been advocating for, so we are pleased that the government has listened to us and the voices of our business owners. We will continue to advocate for additional measures to be put in place to support the ongoing viability of our industry.
Details of new support payment
- A fortnightly payment (3 payments in total).
- Each payment is $4000 per business plus $400 per full-time employee. It will be capped at 50 FTEs or $24,000.
- Businesses must show a 40% or more reduction in revenue over a consecutive 7 days since 15 February 2022 when compared with any consecutive 7 days of in the six week period from 4 January 2022 to 14 February 2022.
- Businesses can apply for the first payment from February 28 and payments start from March 1.
Extension to Small Business Cashflow Loans Scheme also announced
- The amount of funding available to eligible businesses is extended through the introduction of a ‘top up’ loan
- Businesses that have already accessed a loan to can draw down an additional $10,000
- New repayment period of five years and the first two years being interest free
- The first two years of accrued base interest from all borrowers who have, or will, take out a loan under the scheme is removed. This change will mean interest will only start accruing at the beginning of year three
- In addition, government have extended IRD’s ability to apply flexibility for tax payment dates and terms to assist firms with cashflow pressures
Our requests of government are:
- targeted financial support (resurgence and wage subsidy) to see the industry through the next 3 months
- allow policy for rapid antigen tests to be used in hospitality for “return to work” strategy
- facilitate commercial rent reductions that go further than existing legislation as current solutions have been largely unworkable for the industry
- support councils to provide reductions of or flexibility in payment of bills for rates, licensing and administrative fees, as well as simplifying application processes.
- extend the IRD interest-free and Government-backed loans scheme
- implement a voucher scheme to encourage patronage.
Click here for more information about what the Restaurant Association is doing currently to support hospitality.
The government have indicated that they will continue to closely monitor the situation and have the option to extend the payment if this if necessary. We will also be monitoring and gathering data and feedback from members – continuing to push for additional assistance as we see it needed.