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Another tough weekend will “nail coffin” for some

Alert level changes will do little to ease pain, says Hospitality New Zealand

The hospitality sector has lost tens of millions of dollars while being closed under Level 4 in Auckland and operating low capacity under Level 2.5 around the rest of the country.

The latest alert level change to a still very restrictive level 3 will do little to help Auckland’s businesses that are barely hanging on says Hospitality NZ.

Last week Hospitality NZ President Nick Keene warned that more lost revenue could “nail the coffin shut for some businesses” after weeks of zero income, and with poor prospects of a bounce-back in socialising.

September card transactions on hospitality were over a billion dollars in 2019 (and just under in 2020), with up to half occurring on weekends of eating, socialising and entertainment such as theatre and live music.

However, these latest changes to alert levels will do little to ease the pain being suffered by hospitality businesses right now.

“It’s the same story. Day by day it’s getting tougher for businesses to retain staff and keep the lights on,” says Chief Executive Julie White.

“Some in Auckland will open, mostly cafes and traditional fast food, and that’s great for them, even though business will be way down.

“But many are telling us fewer of them will open than in previous Level 3’s because they’ve exhausted their reserves to keep running.

“That’s what Level 3 means for many of them – not opening means money not coming in, but opening is actually money going out the door.

“The Government concedes Level 3 is still very restrictive, and there’s at least a further two weeks of it.

“When you add that to the 34 days of Level 4 lockdown, that means the majority of Auckland hospitality and accommodation businesses would have gone at least 48 days with zero revenue.

“Allowing businesses in the rest of New Zealand to have 100 people indoors make a difference for some, though larger venues will still struggle.

“It’s clear for all to see that our sector has been hardest hit and will be longest to come back.

“That’s why we need a targeted payment on top of a continuation of the wage subsidy and an extension of the Resurgence Support Payment for those who meet the criteria through Level 2.

The Minister of Finance has said he expects the economy to bounce back, but our concern is the hospitality sector will be left to bounce without them.

“Without targeted support, ours will be a dead cat bounce.

“Along with the health measures, the uncertainty is killing out the industry.

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