The Ministry of Social Development has already paid out $922.3 million in two weeks, but many small businesses are still waiting for their wage subsidy
Small business owners say they have been waiting for almost two weeks and have yet to see the money from the August wage subsidy rollout.
Unlike the four-week lump sum businesses were granted last year, now companies have to reapply for the wage subsidy scheme every two weeks. This was one of the changes brought in this year following the Auditor-General’s report on the management of last year’s $13 billion scheme.
Applications for the initial wage subsidy scheme for this lockdown opened four days into the Alert Level 4 lockdown on August 20 and closed on Thursday. The second round became available on September 3.
Webber says her family was living off the company’s reserves, which have been diminishing by the week over the Level 4 lockdown.
“We’ve had no income for two weeks. My husband can’t work but the outgoings don’t get any less. We have children at home to keep safe and the groceries are more expensive, power is more expensive,” she says. “I personally find it incredibly stressful.”
Last year Webber applied for the wage subsidy with all the same details she had provided to the Ministry of Social Development (MSD) this year, and received the subsidy within hours of applying.
“There doesn’t really seem to be any rhyme or reason for why it’s different than last time.”
As at August 31, MSD received more than 313,800 applications for the wage subsidy, approved 225,335 applications and paid out a total of $922.3 million just in the two weeks since it was introduced.
A total of 14,708 were declined, which left about 73,000 that were still being processed.
But Webber says she is concerned about whether her application will be pushed back further in the queue once more people apply for the second round of the subsidy from September 3 onward.
“It would be helpful to know what’s causing the delay. When I called the MSD the woman on the phone told me to apply for the next round anyway so that I don’t miss out.”
Meanwhile, owner of curtain and blinds installation company Teal Tree, Paula Currall-McBride, has also spent nearly two weeks waiting for the wage subsidy, but has received payments from the resurgence support payment, managed by Inland Revenue (IRD).
Currall-McBride says her company lost about $10,000 a week from being shut over lockdown.
But what has confused Currall-McBride is that her wage subsidy payment has stalled over verification MSD requires from IRD about the financials of her business. But those financials were sufficient enough for IRD to approve her resurgence support payment.
“Funny how IRD could pay me the resurgence payment within 24 hours, but on day eight of waiting for the wage subsidy to be paid they say the data doesn’t match at IRD. I’ve spoken to IRD, and they say it’s all there now. Rock and a hard place much?”
“We’ve had no income for two weeks … I personally find it incredibly stressful.”
– Vanessa Webber, Chris Bell Construction
A number of others have raised similar complaints with MSD, a staff member told Currall-McBride.
She was also told after IRD confirmed her details it would take another five to 10 working days to just update her application, not receive the payment.
“MSD told me they’ll give me a call, but I’m still waiting for that call,” Currall-McBride says.
MSD client services support general manager George van Ooyen says the scheme is operating as quickly as it was last year, with the majority of applicants receiving payments within three working days, although the department was still analysing the processing timeframe data.
“The main reason for any delay is when the information contained in the application cannot be matched with Inland Revenue. Timeframes to resolve this vary based on the type of mis-match and required resolution between the ministry, applicant, and Inland Revenue.”
Van Ooyen says MSD will contact those applicants still waiting in “due course” to discuss their application and next steps.
“Businesses and sole traders are generally paid within 24 hours of approval, except for approvals over the weekend, which are paid on the Monday.”
He says businesses must ensure their details are correct and match those held by Inland Revenue.
Employers and sole-traders can apply two weeks after their last Wage Subsidy application, even if the initial application is still being processed.
Businesses that didn’t apply for the initial wage subsidy can apply for the fortnightly wage subsidy payment on September 3.
IRD has been approached for comment.