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Tourism businesses seek wage subsidy extension

The Wānaka App

Diana Cocks

22 April 2020, 6:06 PM

Tourism businesses seek wage subsidy extensionThe NZ wage subsidy is for 12 weeks and provides $585 for employees working 20 hours or more and $350 for those working fewer than 20 hours. PHOTO: Wanaka App

Some local business leaders are calling for a three-month extension to the wage subsidy for employees in tourist-based businesses, but Wanaka’s chamber of commerce Ignite Wanaka cautions local businesses not to pin their futures on such an extension.


Lake Wanaka Tourism general manager James Helmore said the wage subsidy, which started for many employees towards the end of March, has provided much needed support for local tourism businesses in this uncertain time by keeping staff on the payroll. 



“This has helped businesses retain skilled and experienced staff which will be vital as they reopen and start the rebuild process,” he said.


“With visitor demand likely to start slowly as travel restrictions are progressively lifted, additional help from the government by way of wage subsidy extension or other support would help more of our businesses survive to get back on their feet again,” James said.


Accommodation provider Mandy Enoka, of Te Wanaka Lodge and Wanaka Selections, employs 11 staff and said the initial 12 week wage subsidy was vital for the business to retain its current staff.


“It was a relief to get the subsidy for the first 12 weeks,” she said, adding that if the government wants tourism-based business to remain agile and be able to anticipate and respond to a tourism recovery, perhaps first in the form of an emerging domestic market, then an extension to the wage subsidy would help.


Keeping trained and skilled staff would be key to that recovery, she said. “My staff have been extremely loyal throughout the pandemic and we need to do our utmost to retain them.”


However, Ignite Wanaka chair Pete Eastwood said at this stage the government has not alluded to any additional wage subsidies; rather it’s “encouraging businesses to make adjustments to their plans, using the 12-week subsidy to provide time to do that."


Chair of Ignite Wanaka (Chamber of Commerce) Pete Eastwood. PHOTO: Supplied


When the 12-week wage subsidy was announced it was to cushion the impact of the pandemic while enabling businesses to continue paying staff, he said, but finance minister Grant Robertson cautioned the subsidy would not save every job or every business, “which is the stark reality we are facing as a business community," Pete said.


"The subsidy has helped many businesses pay employees … and other financial assistance such as tax breaks, loans, mortgage holidays, etc, were all intended to reduce outgoings and enable businesses the best chance to continue trading for as long as possible. 


"However, the government, and organisations like Ignite, have been guiding businesses to use this time to re-plan and reimagine their business under the various levels as best they could for the future, including right-sizing for a reduced/no tourism market if appropriate,” Pete said.



Businesses will need to innovate and adapt to survive, he said.


"It would be unrealistic to not expect further redundancies and businesses closing due to COVID-19, especially once the 12-week subsidy has expired, and we encourage all businesses to make sure they are accessing all the support, tools and guidance that's available to them at this time," Pete said.


Strict border controls, which directly impact the tourism sector, are expected to continue for the foreseeable future. Prime Minister Jacinda Ardern reaffirmed today (Wednesday April 22) that the change to alert level three would not change the rules on people entering New Zealand. 


Anyone entering New Zealand will still be required to spend two weeks in quarantine or self-isolation in Auckland hotels paid for and managed by the government, she said.  


Queenstown Lakes District mayor Jim Boult said last week he expects it will be winter 2021 before any international tourists return in significant numbers.