Covid 19 coronavirus Delta outbreak: The stressful toll of an Auckland business owner's 10-day wait for wage subsidy

By Belinda Feek

Delays by the Ministry of Social Development issuing wage subsidies is crippling a small Auckland business.

Silverdale's Lush Hair and Make up owner Lyndsey Erasmus says although she received the first round of the wage subsidy within a couple of days, it's now been 10 days since she applied for the second round and there was still no money in the bank.

Erasmus, who has been a hairdresser for 21 years, says battling Covid lockdowns has been so tough that if they have to go through another one, she doubts the business will get through it.

However, after reviewing her application today, MSD confirmed to the Herald this afternoon they had approved her application and the money should go through today.

Erasmus said while the wage subsidy was a good initiative but it paled in comparison to the bills she and her eight other staff and their families faced each week.

"As a business owner I really feel like the weight is on my shoulders and I am responsible for my team but it makes me feel like I've failed them as well."

"Pretty much all of us have kids ... it is quite a stress, especially when you have kids to feed and you try to make things go further."

She didn't feel like Auckland would be getting out of level 4 any time soon, which was putting the health of her business and herself at increased risk.

"That is a huge risk of myself losing my business. This has been my livelihood for the last five and a half years, I've been in the industry for 21 years and it's what I live for.

"Knowing that there is potential of me losing my business ... makes me feel like I've failed but I am trying everything in my being to keep it going.

"If we did, in the foreseeable future come out of it, but then have another lockdown that is my reality that I will have to pull the plug, that's it for me."

She had heard of small business owners taking their own lives because they can't fulfil their obligations as employers.

"I would never go down that route but it really resonates with me, knowing that I have such a responsibility for all these people but I can't give them anything. I try my absolute best to support them."

She was part of hairdressing forums online where sole trade owners were still waiting to receive the first round of the subsidy which wasn't good enough, she said.

"Even the likes of them are getting looked over, but we have to be able to live."

MSD's general manager Centralised Services Jason Dwen said they had approved Lush Hair and Makeup Ltd's second wage subsidy application after reviewing it today.

"It has been approved and payment should follow shortly. We apologies for this initial delay."

The delay had been caused due to the department working through "verification checks".

When contacted about the approval, Erasmus said she let out a "big hallelujah" and quickly informed her staff of the good news.

Dwen said wage subsidy applications had been processed "rapidly", however he confirmed applications relating to sole traders were taking longer.

Since last month, $1,792,669,966.00 had been paid to 274,246 business, supporting more than a million jobs - as of 11 September 2021.

"The vast majority of applications are completed within three working days, with payment in either the same day or next business day. We continue to get new applications every day.

"We have been completing an average of around 20,000 wage subsidy applications per day since the Wage Subsidy Scheme #1 opened on 20 August 2021."

If businesses were yet to hear from MSD about their application they were urged to phone them on 0800 559 009.

Wage subsidy payments:

• 91 per cent of paid applications have been paid with three working days

• 87 per cent of applications completed (paid, approved, closed, declined) have been completed within three working days

• 76 per cent of all applications (including pending) were completed within/have been pending for three working days or less

• To date, more than 42,000 applications have been declined.

Businesses could also be eligible for the Resurgence Payment administered by Inland Revenue.

Finance minister Grant Robertson last week announced a further round of resurgence response payments to begin on Friday with Auckland likely to remain in level 3 or 4.

The resurgence payments would be available until a month after the country returned to level 1.

Businesses need to demonstrate a 30 per cent drop in revenue over a seven-day period.
This could cost up to $430 million and there would be further assistance after that package too, Robertson said.

The payment was different to the wage subsidy scheme and was a grant to help cover fixed costs and overheads faced by businesses.


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