MTA Calls For More Support For COVID-impacted Businesses

A survey of Motor Trade Association's (MTA) Auckland 800 members completed last week found that, due to the lockdown, members are stressed and close to one third (28%) are not sure they will still be in business at the end of 2021. The MTA recognises and supports the ambition for New Zealand to battle the threat from Covid-19, but the cost to business is raising worrying mental and financial health concerns.

MTA CEO Craig Pomare said, "Our members have drained their reserves – financial and mental – and need more help from Government. While the move to Level 3 is welcome, we need to move to Level 2 in two weeks and we need legal mechanisms to negotiate reductions to rent and other fixed costs, and new ways for businesses to operate at Level 4.

"It is becoming increasingly important to balance the public health outcomes alongside the economic and mental health impact these lockdowns are having on business owners."

Pomare continued, "Our survey found that even though most members have accessed the Wage Subsidy and the Covid Resurgence Payment, to keep their businesses afloat, 66 percent have reduced staff wages. A third of members have asked staff to take annual leave."

MTA has heard from Auckland members that the government support payments cover, on average, less than half of total operating costs.

Pomare said, "So while businesses are expected to use government support to maintain 80 percent of staff wages, the businesses themselves are emptying the tank with expenses."

Specifically, the survey found that:

• 66% reduced wages for their staff, mostly by 20 percent.
• Nearly 30 percent asked some or all their staff to use annual leave.
• 96% accessed the Wage Subsidy (August 2021); around 5 percent found the process complex, and one member did not apply for the subsidy because of the complexity.
• 98% accessed the Covid Resurgence Payment; about 10 percent found the process complex, and one member did not apply for the payment because of the complexity.
• 63.5% have not negotiated payment deferral or relief with suppliers.
• 42% have not negotiated rent deferral or relief with their landlord.
• 28% are not sure they will still be in business at the end of 2021

The Motor Trade Association (MTA) is the largest automotive body in New Zealand. Founded in Feilding in 1917, the MTA today represents over 3,800 automotive businesses across New Zealand.

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