Businesses receive financial support to switch to the traffic light system


The financial support that many businesses became accustomed to during the alert levels system is on the way out, but the government is offering more money to help businesses navigate the transition.

Finance Minister Grant Robertson announced on Monday that a payment of up to $ 24,000 would be available to businesses as they transition to the new traffic light system for handling Covid-19.

The one-time bridging payment would be activated through the Resurgence Support Payment System (RSP) criteria and would be available on December 10, he said.

“This payment is at a base rate higher than the current RSP and will be $ 4,000 per business plus $ 400 per full-time employee (FTE) up to a cap of 50 FTEs – a maximum payment of $ 24,000 . The Treasury estimated the probable total cost of the payment to be between $ 350 million and $ 490 million. “

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To qualify for this payment, businesses must show a 30% drop in revenue between October 3 and November 9, and must be compared to a typical week in the six weeks leading up to August 17.

He said it was recognition of the period of time Auckland in particular had spent in lockdown.

“As I said last month, we are moving away from the general economic supports provided under the alert level system. Indeed, at all levels of the new framework, most businesses will be able to operate at near capacity, ”said Robertson.

“On Friday, the final wage subsidy and RSP were opened for applications. These will still be open and paid even if we move to the new framework, in addition to the transition payment. “

Grant Robertson says almost any business will be able to operate under the traffic light system.

ROBERT KITCHIN / Tips

Grant Robertson says almost any business will be able to operate under the traffic light system.

The leave assistance scheme and the short-term absence allowance will remain available, but the leave assistance will change to a weekly payment, starting from the fortnight.

“We will be monitoring any economic impact the new system may have on businesses. I plan to report to Cabinet in early 2022 on this and will provide supporting recommendations if necessary.

“To be clear on this, if deemed necessary, targeted support would only be available under the red frame of the new system, as companies that operate passes for vaccines have no significant restrictions in orange and in green.”

The Cabinet also agreed to change the rules so that newly acquired companies are eligible for the resurgence support payment.

“This issue arose because RER rules required the applicant to have operated a business for at least a month before August 17, so businesses acquired after July 17 were not eligible for any payment,” said Robertson.

“I believe very few companies will have been in this situation, but for those that are, it will have been a difficult time.

“The test will now be that the business itself must have been in business for at least a month before August 17 and that the business must be in the same or similar business as it was before the change in ownership.

“The revenue decline test should also be amended to allow the claimant to use the revenue received by the previous owner during the comparison period to demonstrate the necessary revenue drop during the relevant period. “

The change will take effect on December 10, and newly acquired businesses would then be eligible for RRSPs made as of October 29.

CORRECTION: An earlier version of this story stated that businesses would need a 40% drop in revenue. November 30, 10:05 a.m.


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