Over $17 million to be paid back to Government's Covid-19 wage subsidy scheme

Source: 1News

Millions of dollars is being paid back to the Government's $10 billion wage subsidy scheme by some businesses following an audit.

The Ministry of Social Development said in a statement today that over $17 million is to be paid back, made up of $16.2 million which is voluntarily being returned and $1.25 million which has been requested by the Ministry.

Another $6.9 million has already been voluntarily paid back by businesses and $168,000 (of the $1.25 million) has been returned after it was requested.

The pay back comes after an audit process for businesses where complaints had been made.

"We owe it to those workers and employers to make sure their good work isn’t undermined by anyone abusing the scheme. We also have a duty to all New Zealanders to ensure taxpayer money is going where it is intended to support the economy," Finance Minister Grant Robertson said in a statement.

"We knew the vast majority of New Zealand business owners would access the scheme as intended, to protect jobs, support workers’ wages and stay connected during the lockdown. It’s great to see these business owners doing right by their workers."

The Ministry of Social Development completed more than 2,400 random and targeted audits. Most have since been resolved and additional reviews of 183 cases are being undertaken.

Almost 300 allegations had been received by the ministry, of which 88 have been resolved.

As at 20 April, 1,170 complaints and allegations had been received across Ministry of Social Development, Ministry of Business, Innovation and Employment and Inland Revenue.

As at 21 April, 1,281 applicants had voluntarily advised they want to refund all or part of the subsidy. This has led to $16.2m of refunds requested and $6.9m has already been refunded.

As at 21 April, auditing had also resulted in 56 applicants being asked to refund either all or part of their subsidy. A total of $1.25m has been requested from these applicants with $168,000 already refunded.

Any criminal prosecutions will be led by the Ministry of Social Development in collaboration with other agencies.

"New Zealand taxpayers and those who have accessed the scheme properly expect to see a fair process. If a business provides false or misleading information and knowingly commits a crime, they will held to account. That’s a given," Social Development Minister Carmel Sepuloni also said in the statement.

"For some businesses, circumstances change following receipt of the subsidy, including where insurance may have been received, or new revenue forecasts show the business won’t suffer a 30 per cent drop.

"A number of businesses have come forward when this happens by offering to repay the subsidy, and we encourage any business who may have made a mistake to do the same."