Stewart & Co Blog

 

Yesterdays budget focused largely on helping the country to recover from the economic impact of the Covid-19 lockdown with estimates the Governments spending will help save 140,000 jobs over the next 2 years and create more than 370,000 new jobs.  Prime Minister Jacinda Ardern acknowledged the enormity of the impact of Covid-19 on both New Zealanders and the New Zealand economy. 

"We have never sugar-coated what the future will look like, but nor will we pretend there is nothing that we can do about it. Governments have choices, just as we did when we faced Covid-19. And those choices are between sit back and hope, or sit up and act.  We have chosen to Act." – Prime Minister Jacinda Ardern

The highlights of yesterday's budget include:

• An 8 week extension to the Wage Subsidy scheme
• Support for SMEs to encourage e-commerce
• Increased spending on housing and infrastructure
• $400m to fund a domestic tourism campaign and support the tourism industry
• Trades and Apprenticeship training funding boost along with a Green Jobs initiative
• Free School lunches for 200,000 kiwi kids and help for tertiary students

 

Extension of the Wage Subsidy Scheme

$3.2 billion further has been allocated to the Covid-19 wage subsidy, bringing the total programme cost to some $14 billion.  To be eligible for the second wave of subsidies from 10 June 2020, the business needs to have experienced a 50% drop in revenue in the 30 days prior, compared to the same time last year.  Applications will be open for 12 weeks, will cover an 8 week period and, like the first wave of subsidies, will be paid in a lump sum of $585.80 per week per full-time employee. 

E-commerce Fund

A fund for small business is being set up to help them improve their e-commerce service offerings as well as grants to encourage e-commerce adoption.  Further support will also be given for business advice, the e-invoicing project, Business Connect and the Better For Business programme. 

Housing and Infrastructure

8,000 new state houses are expected to be built or purchased over the next four to five years with $5 billion further borrowings being made available to Kainga Ora to purchase the bulk of the houses. 

A further $570 million is earmarked for rent support for those on low incomes and will be managed through Kainga Ora and other community housing providers.

$56 million towards insulating some 9,000 homes through the Warmer Kiwi Homes initiative and the 67% subsidy for retrofitting insulation would be increased to 90% making it more affordable for low income households to be able to insulate their homes. 

$1.1 billion will be invested in improving transport across New Zealand.  This will include the replacement ageing of trains and ferries, including the Interislander ferries and their ports. 

$3 billion is to be spent on "Shovel Ready" infrastructure projects.  These are projects that are far enough through the planning and engineering stages that start on the projects could begin in a very short time with sufficient funding.  Approximately 2000 application have been made for this fund and Ministers are now deciding which projects are to go ahead. 

Domestic Tourism

A $400 million  Tourism Recovery Fund is to be established for the purposes of promoting New Zealand to domestic and Australian tourists as well as advisory assistance to tourism businesses to either help them stay in business, hibernate, or find other options. 

Trades Training and Green Jobs

A $1 billion package will be rolled out in the regions to create some 11,000 jobs focused on the environment such as biosecurity, pest control and DOC's "job for nature" fund.  This funding "will not only help restore our natural landscapes, native bush, waterways and coast, it will give thousands of people access to well-paid work so they can continue to provide for their families" -James Shaw, the Minister for Climate Change.

Additionally, $1.6 billion is to go into a trades and apprenticeship training package extending the "fees-free" vocational training to those out of work, not just school leavers.  This includes $334 million for further tertiary education, $320 million for free trades training and $412 million to assist employers to keep on their current apprentices. 

Free School Lunches and help for tertiary students

The Government is focused on making New Zealand one of the best places in the world to be a child and part of that is providing free school lunches to some 200,000 children.  $220 million has been pledged to this program which is also expected to create an additional 2,000 jobs. 

Tertiary students will have access to a $20 million fund for hardship grants to help them continue their studies over the coming year. 

Other Highlights

• $203 million boost to funding for family violence services
• $1 billion to go to the New Zealand Defence Force, $898 million of which is to go towards the purchase of new Hercules aircraft.
• $414.2 million for the Early Learning Sector, including funding subsidies, pay increases for educators, additional support for home-based educators and investment in playcentre sustainability
• $3.9 billion to ensure all DHBs continue to meet the needs of their populations
• $193.5 million to support farmers through the eradication of Mycoplasma Bovis
• $47.8 million to replace ageing communications capabilities for Police, Fire and Ambulance to support healthier, safer and more connected communities

ACC have announced that from 1 March 2020 they will no longer be accepting cheque payments from customers who are able to use an alternative payment option.  To be able to make payments from 1 March 2020 to ACC, you can use one of the following:

 

• Credit Card: Using the following link (Pay online by credit card) you can pay online using your credit card.  To do this, you will need your ACC Number and Invoice Number.  Westpac bank process these payments and charge a 1.9% convenience fee on all credit card payments.  ACC does not receive these funds.  

• Internet Banking: Use the one off bill payment option and select ACC as the payee.  To ensure your payment is allocated correctly, use the following

 Particulars – Levy account name 

Code – ACC policy number eg YN123456E or 1234567890 
Reference – Invoice number eg A123456789

• Self-Service through My ACC For Business:  You can use this service to pay your levy by direct debit over 3, 6 or 10 months.

• In Person: Present your invoice at any branch of the Westpac Bank to pay by cash or Eftpos.

 

Also, ACC will no longer be issuing refunds by cheque.  Instead the funds will be direct credited to your nominated bank account and a refund notice will be issued to let you know it is coming. 

If you have any questions do not hesitate to contact us or contact ACC at:

• Phone (self employed) - 0508 426 837
• Phone (employers) - 0800 222 776
• Overseas - +64 7 859 8676
• Email - business@acc.co.nz

 

The IRD have announced that from 1 March 2020 they will no longer accept payment by cheque, or cheques dated after 1 March 2020, from customers who are able to pay another way.

Here is a summary of the other payment options

• MyIR: Direct debit and card payments can be made from your myIR account.
• Online Banking: One-off or scheduled recurring payments can be made using online banking. 
• Money Transfer: Clients based overseas can pay IRD using a money transfer service.  Search for "Make a payment" on the IRD's website for more information. 
• Credit or Debit Card via The IRD Website: Payments can be made by credit or debit card through the IRD's secure payment website.  Go to www.ird.govt.nz and search for "Make a payment" and select "Pay using credit or debit card".
• Westpac: EFTPOS or cash payments can be made at any Westpac branch or Smart ATM.

For more information on these options and for details on what references to use, please visit the IRD website. 

If you need any help getting started with online banking please check with your bank or local community group if they offer free digital banking courses.  

As always, if you have any questions, do not hesitate to contact us.