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MTA Welcomes Rent Relief For COVID-impacted Businesses

Wellington 29 September 2021: The Motor Trade Association (MTA) welcomes Minister Faafoi's surprise announcement of mechanisms to drive rent relief discussions between small businesses and their landlords. Mechanisms the MTA had called for in a letter to the Government at the beginning of the month.

MTA CEO, Craig Pomare said, "Our members have drained their reserves – financial and mental. This mechanism is a good first step to easing some of the burden of rent and other fixed costs. Though there will still be hurdles for small business owners to clear before they see change, and we expect that debating what a “fair proportion” amounts to will create some issues."

Pomare continued that, "To make the package more complete, MTA would like to see the reintroduction of subsidised arbitration and mediation services for businesses and landlords which allowed parties to access up to $6,000 per dispute. In this way today's announcement is supported with a "safety net" for both parties.“ This COVID-specific support ended in March 2021.

A recent survey of around 800 of MTA’s Auckland members 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. Nearly half (42%) of the members surveyed had not been able to negotiate rent deferrals or relief. Members also indicated that Government support payments only cover around half of ongoing expenses, while revenue is almost completely reduced at Alert Level 4.

Other survey findings include:

· 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);

· 98% accessed the Covid Resurgence Payment;

· 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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