Prime Minister Jacinda Ardern’s Level 3 extension announcement has placed the hospitality sector ’s very survival under threat and urgent, targeted support is required, says Hospitality New Zealand CEO, Julie White.

The Government’s decision to extend Auckland’s Level 3 lockdown restrictions (until Sunday, 30 August at 11.59pm) and keep the rest of the country in Alert Level 2 is ‘hugely disappointing and frustrating for the hospitality industry,’ says White.

“The safety of all New Zealanders is our first priority. We supported the Government’s directive to stamp out COVID-19 when it re-emerged in the Auckland community, however, it’s very frustrating for the regions outside of Auckland to still have to operate under Level 2.

“It’s still extremely restrictive for our operators. With this extension in Auckland, the hospitality sector will be in a state of carnage, because these lockdown measures will have a ripple effect across the entire country,” adds White.

Whilst it was said that up to 80 percent of businesses were able to operate at Level 3 in one form or another, Hospitality New Zealand says that for its sector, operating at Level 3 is still similar to lockdown.

According to MBIE’s latest figures Auckland’s domestic spending was already down 33 percent last week, compared with the same time last year and Food Beverage spend was down 36.8 percent.

“Unless you have a food and beverage establishment that is fully set up for takeaway service, it’s very difficult to operate under Level 3, as you simply don’t generate enough income to sustain working seven days a week.

“And as for operating under Level 2, this is still quite prohibitive because abiding by the three S’s and limiting venues to 100 people, greatly reduces income.”

White also adds that operating under a cloud of such uncertainty with possibly yo-yoing between Alert Levels is not a sustainable solution.

“We are all doing our part to keep our fellow Kiwis safe, but the Government’s decision still leaves great uncertainty. We cannot continue to go up and down Alert Levels and in and out of lockdown. The uncertainty is decimating our sector. These businesses need time to prepare stock, adjust rosters and have grappled with changing restrictions at each Alert Level. We need some solace.

“There’s also a real concern that many Kiwis have COVID lockdown fatigue. As people’s adherence to the rules begins to wane, that unfortunately puts further pressure on our operators to ensure their customers abide by them. This all comes at a big financial cost for these already struggling businesses,” adds White.

Hospitality New Zealand says the one silver lining for lockdown 2.0 was the strong numbers of downloads for the Government’s COVID Tracer app, with more than 1.7 million registered users to-date.

“With two thirds of our population not moving around the country, we need Kiwis to go out and support local hospitality providers. We encourage all customers to continue using the COVID Tracer App and start regaining a sense of your normal routine – that’s the only way the sector will survive.”

HNZ says it continues to advocate for a targeted support package from the Government’s $14 billion COVID Recovery Fund, as the industry continues to be hammered by the ongoing impact of the Alert Level restrictions.

“The extension of the wage subsidy has indirectly helped business owners, but it only goes towards staff wages and doesn’t help with fixed costs. Business owners are best placed to make decisions on their business so a cash injection, like a working capital grant, will make a real difference.

“Our backs are up against the wall; we’ve suffered huge economic pain and we’re pleading as an industry that is on its knees. We urgently need targeted support – where’s the appetite from Government to come to the party on this ?” said White.

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  1. Where I run my business from in this country, we don’t have the problem with customers not coming in
    We have seen an up lift in local New Zealand people travelling around their beautiful country instead of going overseas because of covid. Which is only good for economic growth in our country

  2. After the August 11 announcement all our booked functions were cancelled one after the other. Thus we lost a total revenue of over $15,000 in a month that looked so good. The first weekend the number of guest was severely down. And that has not changed since then. You prepare for the weekend and at the end of it you an throw away heaps of product. Wage subsidy is just a drop on a hot plate and the extra cost we now faced due to missed revenues, wasted food have forced us to temporarily close the business until we reach level on again. But when will that happen when the government is solely focused on eradicating a virus that will never go away, just like the flu virus never will?

  3. I would be interested in hearing your views about the increased chances of having a person with covid19 visiting your establishment and the onward effect of shutting the business and having staff off for a while. Also what do you see as being the damage to a brand if this does happen?

  4. Agree entirely that Hospitality needs targeted funding relief as the industry has clearly fallen further than any other business sector.
    Without relief there is no chance of saving jobs or businesses within the sector for a long time. In fact I would expect that overseas companies will target purchasing properties in NZ one way or the other as local Properties are forced to sell or close. Good for the buyers but not so good for NZ Inc.

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