New Zealand

Like being kicked when you’re already knocked out

Latest support package does little for hotels smashed by closed borders

Hotel Council Aotearoa (HCA) says the latest government COVID support package largely ignores businesses that continue to struggle with the impact of closed borders.

Instead, according to HCA strategic director, James Doolan, the package prioritises businesses fortunate enough to rebuild revenues to near-normal levels after borders were first closed in March 2020.

“New Zealand has fought the COVID pandemic using a combination of border restrictions and domestic COVID settings, such as lockdowns, domestic borders and the traffic lights system,” Mr Doolan said.

“Why is government still refusing to offer targeted support to worthy tourism businesses that are disproportionately affected by border settings? Hasn’t the border closure been a key part of our COVID response?”

The new government support package requires businesses to show a drop in revenue of 40 percent as a result of the shift to Phase 2 on 15 February.

“The Omicron outbreak has been pain-on-pain for hotels,” Mr Doolan said.

“For hotels, the Omicron outbreak is like been kicked when you’re already knocked out. The kick isn’t great, but it’s not the main problem”.

“Many hotels and other tourism businesses will not qualify for the new support package because the comparison is between revenue levels already smashed by closed borders. If earnings were terrible before 15 February and terrible afterwards, you might not qualify.

“That’s a bizarre outcome.“

The problem, he said, is easily fixed with support being provided to any business that can show a 40 percent drop in income between the periods either side of 15 February, or alternatively if they can show an even larger 50 percent drop in income when compared with the same periods in 2019, before borders were closed.

“Adjusting the qualification criteria to acknowledge the ongoing impact of closed borders is the absolute minimum that Government should do for battered tourism businesses,” he said.

“A truly targeted support package until borders reopen properly would be even better.

“Once again, government has chosen not to support worthy businesses for whom the borders, and not domestic outbreaks, are the biggest problem”.

HCA, he said, was also concerned that the Prime Minister gave no further clarity on when isolation on arrival will be removed for international travellers.

“No high value international tourist will return to New Zealand if they are required to spend the first seven days staring at a hotel room wall,” Mr Doolan said.

“If we want a good winter season, if we want to save Summer 2022/23, then our hotels, airlines, travel agents and inbound tourism operators need the green light to start marketing New Zealand without isolation on arrival.

“Our nearest competitor Australia is open for business already, so time is fast running out.”

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