Business support extended in NZ


17th August, 2020

NZ Election: Voting delayed, fresh business support announced

Prime Minister Jacinda Ardern has postponed New Zealand’s General Election by a month following a new COVID-19 outbreak.

Following last week’s news that there would be a 12-day extension of the country’s current COVID-19 restrictions, the Prime Minister has opted to delay the General Election, which was to be held on 19 September.

New Zealanders will head to the polls on 17 October now instead.

“This decision gives all parties time over the next nine weeks to campaign and the Electoral Commission enough time to ensure an election can go ahead,” said Ardern according to the NZ Herald, adding that she had “absolutely no intention” of allowing any further delays to the vote.

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Government announces new business support, plus extensions

The delay to the election, which is also supported by the opposition (National Party), arrives off the back of new restrictions imposed on Auckland last week after a new COVID-19 community outbreak was discovered.

A total of 49 cases linked to a single cluster had been found by Sunday 16 August, following a period of more than three months with no detected cases in the community across the entire country.

The new lockdown rules mean people in Auckland are required to work from home where they can, with the Government also highly recommending people wear face masks when they can’t maintain a safe physical distance of more than two metres. At this stage, these rules will be in place until 26 August.

One of the more stark impacts of re-introducing lockdown in Auckland will be felt by the business community, which has already suffered from previous lockdowns and the ongoing lack of international visitation.

For this reason, the Government has moved quickly to introduce a new round of support for businesses and workers alike.

“The new wage subsidy will help support cashflow and confidence. Along with the existing wage subsidy extension – which is open until 1 September for eligible businesses – the Treasury estimates that about 930,000 jobs will be covered by the two schemes,” said Finance Minister, Grant Robertson.

Robertson also announced the Government would “further support wide-scale testing” by removing the revenue-drop and ‘negatively impacted’ test requirements for the COVID-19 Leave Support Scheme.

“This means businesses with workers who have been told by health officials or their medical practitioner to self-isolate, will receive the equivalent of the wage subsidy to help cover that person’s wages for the time they cannot be at work,” said Robertson.

“Our focus is on doing everything we can to support our strong public health response.

“That means removing barriers to a person getting tested, including fears that a positive result would put their employment at risk or that they wouldn’t receive income while they couldn’t work because they had used up their sick leave.”

The Government also confirmed the mortgage deferral scheme is being extended from its current end-date of 27 September this year to 31 March, 2021, with further details to be made available by the Reserve Bank and retail banks in the days ahead.

It’s also understood further work will be done on support initiatives like the Small Business Cashflow Loan Scheme and the Leave Support Scheme to make sure they’re appropriate for the environment as alert levels continue to shift.

“At the same time as putting these measures in place to cushion the blow, we are continuing to roll out our comprehensive recovery and rebuild plan around New Zealand by investing in training, creating jobs through infrastructure investment and supporting businesses through the tax system,” said Robertson.

While a potential new wave of cases threatens the New Zealand economy and the wellbeing of local communities, it now seems set to influence the political sphere in the lead up to the election, with a recent MYOB survey of SME business operators finding a swing in sentiment towards the Labour Party, likely as a result of the Government’s emergency response to coronavirus.

Are you a New Zealand-based business owner looking for tailored advice regarding Government stimulus, business planning and more? MYOB recommends starting your journey by consulting with an accredited business advisor. You can search for advisors near you, here.