Proposed Business Support Package due to Resurgences of Covid 19 in the Community

Proposed Business Support Package Announced

The Government has proposed a package to support businesses and individuals in the

event of Alert Level escalations due to resurgences of COVID-19 in the community. The

package retains some key existing financial support and adds new elements based on

experience and business feedback. This allows businesses to plan knowing what support

they will receive if Alert Levels rise to 2 or above and they are directly impacted.

This support will be available late February or early March 2021 subject to the necessary

legislation being passed.

Business support measures include:

• At Alert Level 2 or above, directly impacted businesses will be able to apply

for a one-off Resurgence Support Payment, providing cashflow support to

cover fixed costs such as rent. Inland Revenue will administer this payment.

• Firms can still access the Small Business Cashflow Scheme for additional

cashflow support or seek lending from their banks (including loans through

the Business Finance Guarantee Scheme).

• At Alert Level 3 or above, the most affected firms can also seek the COVID-

19 Wage Subsidy to help them keep their staff employed.

• At Alert Level 4, other support measures such as childcare for essential

workers, freezes on residential tenancy rent increases and restrictions on

residential tenancy terminations will assist firms and households through the

most severe public health restrictions.

• A Short-term Absence Payment will be available to eligible employers to

support eligible workers who stay home while waiting for a COVID-19 test

result. This is also available to eligible self-employed workers.

Small Business Cashflow (Loan) Scheme changes

On 9 November 2020 the Government announced changes to the Small Business

Cashflow (Loan) Scheme.

The changes included:

• No interest will be charged if the loan is repaid within two years. Under the

original Terms and Conditions of the Small Business Cashflow Loan Scheme

Contract no interest is charged if the loan is repaid within one year.

• From 9 November 2020 the restrictions on what the loan can be spent on have

eased so that the loan can be spent on investments to help businesses adapt to

the impact of COVID-19.

In addition, applications for the loan can now be made until 31 December 2023, an

extension of three years. Inland Revenue is working on making these changes for all borrowers.