A Week in Review

Richard AshbyPartner, Gilligan Sheppard

Time is running out

The Resurgence Wage Subsidy (aptly named by some creative person within the Powers that Be) is the recent two week extension to the original wage subsidy, triggered by Auckland’s return to Level 3, and the rest of New Zealand to Level 2.

The new subsidy covers a two-week period which commences on the date of application, and for those that have not applied yet, time is fast running out as the application period closes at 11.59pm on the 3rd September.

For those employers looking to claim, they must have seen, or expect to see, a revenue drop of at least 40% over a 14-day period between 12 August and 10 September 2020 when compared to a similar period last year.

The eligibility criteria that applied to earlier subsidies such as mitigating steps and retaining subsidised employees, continue to apply.

Also, a reminder about two other Covid-19 relief packages –

The Leave Support Scheme eligibility criteria changed effective 1pm on the 21st August, no longer requiring claimants to have to show a decline in actual or predicted revenue, and further, that those employees for whom the scheme would cover, now included self-isolating employees who either:

  • Tested positive for Covid-19.
  • Came into contact with another infected person.
  • Are vulnerable, or,
  • Live with vulnerable persons.

There has also been tinkering with the Business Finance Guarantee Scheme, with the 80% State backed bank loans now:

  • Extending to medium-sized businesses having annual revenue up to $200m.
  • Including grants up to $5m for five years.
  • Permitting the loan funds to be used to refinance existing loans, and/or for capital investments.
  • Allowing the banks to act outside of ordinary loan policies and processes (let’s see how this one works in practice!).
  • Enabling the State to pay loans that were not personally guaranteed, and,
  • Extending the application period until 31 December 2020.

Participating banks include ANZ, ASB, BNZ, Heartland Bank, Kiwibank, SBS Bank, TSB, Bank of China and Westpac.

Good luck!