A few Covid support package announcements were made during the week.
- A new resurgence support payment is being introduced to help businesses directly affected when there is a move to Alert Level 2 or above for a week or more. The package includes a one-off payment of $1,500 plus a $400 payment per employee up to a total of 50 FTEs. Businesses will need to declare a drop of 30% or more in income over a 14-day period as a result of an increase from Alert Level 1 to Alert Level 2 or higher. They must have been in business for at least six months in order to apply. Legislation containing the measure is expected to be introduced early next year.
- A commitment to the Wage Subsidy Scheme where there is a regional or national move to Alert Levels 3 and 4.
- Retention of the Leave Support Scheme, including the addition of a new short-term absence payment to cover eligible workers needing to stay at home while awaiting a Covid-19 test result. This will be a one-off payment of $350 to employers to pay workers who need to stay home while awaiting a test or while someone who is their dependent is doing so in accordance with public health advice.
- A reminder that the Business Finance Guarantee Scheme, has been extended to June 2021 with additional availability and flexibility.
- The Small Business Cashflow Scheme has been modified. Going forward:
- The eligibility criteria will be broadened to include new businesses. Businesses established after 1 April 2020 and which have existed for six months will now be eligible for a loan if they meet other eligibility criteria.
- There is a change to the 30% decline period – the new criteria is that businesses can demonstrate an actual drop in revenue of at least 30% because of Covid-19 over any 14-day period in the previous six months, compared with the same 14-day period a year ago. If the applicant was not in business a year ago, the 14-day period can be compared with the same or similar period in the previous month. Businesses must also declare that the drop in revenue was due to Covid-19 and have records to support this.
- Businesses will be able to draw down a second loan if they meet the eligibility criteria and have repaid the original loan in full.
The purpose of the scheme will be extended and will enable borrowing for investment in new equipment and digital infrastructure.