Government Loosens Lockdown Business Support Requirements

The Government has loosened the requirements for one of its new business support measures, making it easier for businesses hit by COVID-19 restrictions to claim a grant of up to $21,500.

Any decision on whether the payment would actually be used will be made if there’s an extension to the current Alert Level restrictions, said Finance Minister Grant Robertson.

The Resurgence Support Payment, a grant system for businesses affected by a drop in revenue as a result of COVID-19, was announced in December, as a package that would be rolled out if any part of the country were at level 2 or above. Businesses that suffered a 30 per cent drop in revenue over any 14-day period would be able to get a payment of $1500 plus $400 for each employee up to a total of 50 full time equivalent employees.

Robertson has announced that the 14-day window that would be used to test for a revenue shortfall had been halved to just 7 days.

“This payment recognises that some businesses face one-off costs or impacts to cashflow when we step up an Alert Level to follow public health advice,” said Robertson.

“The payment is structured to provide most support to smaller firms who are most likely to face cashflow issues but will be available to all businesses and sole traders.”

The Government will also ready its other, previously announced support, such as the wage subsidy which could return in similar form to the last lockdown. It will pay businesses $585.80 per week for each full time employee and $350 per part-time employee. Support will be paid to businesses in fortnightly payments and the total support given will match the duration spent at alert level 3 or 4 rounded to the nearest fortnight.

The qualification threshold for the new subsidy is slightly different to what was used last August. Instead of businesses having to prove they had suffered a 40 per cent decline in revenue compared to the same period a year before, businesses will now have to prove they have suffered a 40 per cent revenue decline relative to the same period six weeks before the alert level change.

The reason for this is that one year ago, many businesses were starting to see the effects of COVID-19, so comparing revenue with an arbitrary period in 2020 doesn’t give an accurate reading on the health of a business.