12 August 2020
To: Hon Grant Robertson – Minister of Finance, Hon Kris Faafoi – Minister of Commerce and Consumer Affairs, Hon Stuart Nash Minister of Small Business
Tēnā koe Ministers
Alert level movement impact on hospitality businesses
I recently wrote to you seeking additional fiscal support for hospitality businesses either by way of an extension to the wage subsidy or the introduction of a targeted revenue drop based (hardship) grant. With the Prime Minister’s announcement last night, the need for this support is significantly accelerated.
The announcement is a devastating blow for those hospitality businesses already struggling from the impact of the COVID-19 lockdown and border closures. The return to Alert Level 3 in Tāmaki Makaurau will affect 976 Member businesses and we anticipate a sharp rise in loss, to the tune of $116 million per week should Alert Level escalations remain in place. This comes following a post-Covid lockdown trading recovery to just $19 million per week losses by hospitality businesses, buoyed by a positive school holiday period.
There are also many unseen costs associated with Alert level movement decisions, such as fixed rent costs, single server costs, and more commonly food wastage. Hospitality operators order days in advance to ensure rolling supply of fresh produce, and while three days seems insignificant, this announcement will see large quantities of wasted food across Auckland and further financial crunch on businesses. While we are working to assist members to partner with food redistribution organisations such as Fair Food, it is important to note there are considerable financial losses attached to all Alert Level movements for our sector.
We have already redistributed the Alert Level 2 and 3 safe operations guidelines and impressed upon Members the importance of downloading the COVID-Tracer App and roll out QR codes, if they have not already. We are of course very disappointed by the re-emergence of COVID-19 and potential community transmission, however our focus is now on supporting members to manage this situation as best they can and are hopeful we can return to normal trading as quickly as practicable. Please urgently consider further assistance for the hospitality sector, as many continue to work to keep their employees in work and their businesses afloat. I am available to brief you and your officials on any of these matters as required, please do not hesitate to contact me.
Ngā mihi nui,
Marisa Bidois
Tāhūhū Rangapū (Chief Executive)
Restaurant Association of New Zealand