'Hundreds' of Auckland hospitality businesses on brink of closure

Source: 1News

Hospitality New Zealand is warning that hundreds of businesses in Auckland's hospitality sector could close for good over the coming weeks if the Government doesn't step in to help. 

Auckland branch president Jamie Freeman says he's been inundated with pleas within the sector who are now on the brink of shutting up shop and the Covid-19 lockdown drags on.

He says from the beginning of lockdown on August 18 through to September 3; the hospitality sector has lost a whopping $368 million. 

"It's been really tough for everybody. I've been speaking to operators who in this lockdown especially have lost their homes and properties," Freeman told Breakfast. 

"Accommodation and hospitality have been really hit hard by this lockdown."

The Delta outbreak has been a final blow for some businesses, he says, with many still reeling from the impacts of previous lockdowns in Auckland. 

Takeaway coffee (file picture).

Freeman added that the past two years have been particularly rocky for the sector, with profits still noticeably lower than pre-Covid levels. 

"Without a return to Level 1 or an increase in customers and financial assistance, my bid is that hundreds of hospitality businesses are only days if not weeks away from closure.

"Once you close and profit is gone, you can't bounce back. You can't bring it back. We've only bounced back to about 80 per cent of pre-Covid revenue streams."

Freeman acknowledged that Government has been actively listening to the hospitality industry but that they couldn't afford to keep waiting for support any longer. 

He told Breakfast he's heard from some businesses that have chosen to close instead of waiting on the Government to change restrictions. 

"It's really hard to plan just two weeks ahead, so we need to have a really strong plan on how we're going and what's going to happen." 

Hospitality New Zealand wants the Government to consider extending the wage subsidy and resurgence payments for the sector into lower alert levels to help them keep afloat. 

Freeman says the payments would give businesses security as they try to claim back some of the lost earnings from the past several weeks as they readjust at Level 1 and 2. 

"They're talking to us, and they're listening. They understand the fight we're under, but we just need action," he says. 

"I do want to thank the government for engaging with Hospitality New Zealand, but we can't wait any longer." 

Prime Minister Jacinda Ardern has acknowledged the extra strain that Auckland businesses have been under after yet another stint in lockdown but ruled out extending the wage subsidy scheme when the city moves down alert levels.

Speaking to Breakfast on Monday, Ardern said the subsidy was designed for businesses who weren't able to operate at all or in limited capacity at Level 3 and 4 but could do at lower alert levels. 

She says the resurgence payments in place will offer further support to businesses struggling by lingering lockdown affects in areas like the CBD where business activity may take longer to pick up.