Auckland businesses on the brink say they might have to shut up shop or slash staff numbers if the Government doesn't offer more financial help.
Photo: 123RF
More than 300 hospitality businesses met virtually at the weekend to discuss the sector's survival, and some say their calls and the ongoing hardship have long been ignored by the authorities.
Cook Brothers Hospitality group managing director James Arnott attended the meeting.
He said it has been tough since Auckland moved into lockdown but his company has been paying its 90 staff in the city as much as they can.
"For about half of the staff, that's 100 percent of the wages, and for the other half it's about 80 percent of their normal wages, and that costs a business about $20,000 per week, because the wage subsidy that we get doesn't cover that amount that we're paying our staff."
Arnott said there are operating expenses too - such as electricity, insurance and rent.
"I think the really scary thing - this is what one of the things for the meeting yesterday is and a lot of other operators are feeling this way as well - is that when we get to level 2 actually the wage subsidy is due to stop and those costs that I'm just talking about actually get higher," he said.
Hospitality New Zealand hosted the meeting. Its Auckland branch president Jamie Freeman said his industry is always the first into and last out of the Covid levels.
"Hospitality are doing it hard from August 19 until September 23, Auckland alone saw a revenue loss of $281 million. We've seen that Auckland is always harder hit from previous lockdowns."
Freeman said it's sad to hear businesses are folding, including some iconic restaurants - and it could be just the start of many closures if the government continues to ignore their cries for help.
"They've gone into major debt. It's unprecedented what they're going through. They're struggling to keep their heads above water and the key points for government to listen to would be to provide the wage subsidy for staff at hospitality businesses at level 2 and make resurgence payments available weekly or biweekly, tied to revenue level."
Heart of the City chief executive Viv Beck echoed that call.
She said the city centre generates one fifth of Auckland's GDP and has lost $134 million in consumer spending since the start of level 4 lockdown in August, an average of more than $100,000 per business.
Apart from the wage subsidy at level 2, and more frequent resurgence payments, Beck also wanted access to low-cost and easy-to-repay money. Further more, she said an integrated plan is needed.
"A very clear pathway ahead that covers a whole range of things that are affecting businesses. Right now, whether it's MIQ, whether it's vaccination, whether it's access to capital, digital development, the way the border works around Auckland, there's a whole lot of things that are adding a lot of challenge to businesses."
She said a survey shows 80 percent of businesses are supportive of a "no jab, no job" policy, and there's a growing call to require customers to be vaccinated too, but operators weren't sure what to do.
"What they're really looking for is some guidelines or mandate or whatever it needs to be to allow them to do that without facing legal risks."
Amotai represents 800 Māori and Pasifika businesses around the country. Its general manager Ariana Paul said these businesses are disproportionately hit by lockdowns.
She said many are small or medium-sized and their low reserves have dried up.
"There are no reserves. They are looking into...their own personal equity that they have remaining, and whether the decision that they have to make is are we going to... mortgage our homes to get through this lockdown."
Paul said calls from various business groups in Auckland are not being heeded.
"There are solutions here in Tāmaki Makaurau, but they just don't seem to be getting down to Wellington and that's where you know we've really felt it is that we almost feel like we're invisible."
Hospitality opens at step three of the Government's new Auckland roadmap.