National says small businesses are the victim of "coalition dysfunction" between New Zealand First and Labour after a disagreement over commercial rent saw negotiations stretch out across months.
Winston Peters called proposed changes to commercial rent by Labour "poorly targeted", saying it wanted to alter contract law for all existing lease arrangements.
But Justice Minister Andrew Little disputed that, adding the NZ First leader was "wrong to state that the proposal would have applied to every lease agreement".
Businesses had been calling out for assistance with commercial rent relief after the impact of Covid-19 decimated revenue for many workplaces.
Today, after months of signalling, the Government announced a temporary change to commercial leases , adding a clause requiring a fair reduction in rent where a business has suffered a loss of revenue because of Covid-19.
Shortly after, NZ First released a statement saying the solution to the commercial rent issue was "not to alter contract law for ALL existing lease arrangements, which is what our coalition partner wanted".
Mr Peters called it "poorly targeted policy".
"Using a sledgehammer to smash a nut is not commonsense.
"We urged our coalition partner to better define the size and problem of commercial rent disputes," Mr Peters said.
In response to that, Mr Little said the original proposal six weeks ago explicitly excluded tenants and landlords who had reached agreement on terms as a consequence of Covid-19.
"In this respect, the leader of the NZ First party is wrong to state that the proposal would have applied to every lease agreement."
When asked about the commercial disagreement today and if businesses had suffered during the negotiation period, Mr Peters said the Small Business Cashflow Loan Scheme, which offers a year-long, interest-free loan, was "NZ First's idea".
"We did that to cover the very costs you’re talking about."
On the changes to commercial rent, Mr Peters said that "having seen an attempt to alter every lease contract, which is really a matter of great sanctity in our system, we said, 'You can’t do that.'"
Prime Minister Jacinda Ardern said they were open that there was "some negotiation that went on" over commercial rents.
"The most important thing is that we have now an outcome that means, particularly, small businesses that find themselves in disagreement or in a difficult situation with their landlords now have the support of the Government to be able to resolve some of those disputes."
National's Paul Goldsmith told 1 NEWS that small businesses were the victim of "coalition dysfunction".
National argued weeks ago, he said, that small businesses needed cash to help deal with the crisis.
"This has been far too slow.
"What we need now is a clear economic plan. Further evidence of coalition infighting makes that harder."
This morning, NZ First MP Shane Jones told TVNZ1's Breakfast his party would not be "absorbed" by Labour ahead of the election.
The NZ First MP says the party is going to distinguish itself from its coalition partner. (Source: Other)
"My leader and I, we're just not going to tolerate being absorbed or completely shaded by the Labour Party," Mr Jones said. "You're going to see us well and truly distinguish ourselves in 12 weeks, which is when voting starts."
For the changes to commercial rent, businesses need to have a maximum of 20 full-time staff at each leased site, be based in New Zealand and have not already come to a rent agreement with the landlord.
If an agreement cannot be reached, $40 million had been set aside for arbitration costs.
Mr Little said he is concerned some landlords and tenants are not coming to agreements "that reflect the seriousness and uniqueness of Covid-19...including behaviour where large commercial tenants refuse to pay rent, and landlords demanding rent from small retailers who haven’t been able to operate."
Timeline
On April 1, Finance Minister Grant Robertson acknowledged rent and utilities were a big cost for SMEs, and revealed the Government was working with the sector to create a package to "deal with that".
On April 20, Mr Robertson said the Government made moves to ensure businesses could not be evicted for 30 days, so that commercial landlords and tenants would come to "constructive arrangements".
He said the Government was putting billions of dollars into keeping businesses going, "but that hasn’t stopped us from looking at what more might be possible".
On April 28, when asked about commercial rent issues, Ms Ardern said that if some commercial landlords do not come to an arrangement with tenants, they "may end up a position where you may find yourself with a vacant property [in a] time it will be very, very difficult to lease".
The Government announced on April 29 it was considering commercial rent relief changes.
MsArdern said on May 29 the Government intended to address issues around commercial rents "very, very soon".
SHARE ME