Update - Thursday 9 April 2020

COVID-19 Local Government Response Unit main page 

The Government wage subsidy: councils and some subsidiaries eligible to apply

The Response Unit continues to work as a matter of urgency on the important matter of council and council entity eligibility (individual or collective) for the Government COVID-19 wage subsidy.

There will be further and more detailed guidance next week. We ask for your patience while we work through some complex issues. In the meantime we can report the below.

In discussions yesterday, with officials from the Ministry of Social Development, Treasury and Ministry of Business Innovation and Employment, the Response Unit received an unequivocal assurance that, subject to meeting specified criteria, councils and their separately registered subsidiaries are eligible to apply for the Government wage subsidy.

For details of the subsidy scheme, criteria and guidance for potential applicants please visit the work and Income website.

All councils will meet the criterion of being a “business registered and operating in New Zealand” (ie, as all councils are on the New Zealand Business Number Register).  Council subsidiaries can apply independently from the council, but to be able to do this the subsidiaries must be separately registered with

the Companies Office.  If in doubt about registration status you can search for the relevant entity on the New Zealand Business Number website. 

Examples of separately registered entities are Charitable Trusts such as the Wellington Zoo Trust (NZBN 9429043129751) and the Southland Museum & Art Gallery Trust Board (9429042728689); and Limited Companies such as Auckland Tourism Events and Economic Development Limited (NZBN 9429031397964) and Waikato Local Authority Shared Services Limited (NZBN 9429034424940).

It is important to remember that the overriding purpose of the subsidy scheme is to protect jobs and keep people employed.  All councils and council entities must meet the wage subsidy criteria relating to specific employees that must be named in the application (ie, the employees must be legally working in New Zealand and will be retained by the council for the period of the subsidy).

We expect it may be challenging for most councils to demonstrate that they meet the criterion of “a minimum 30% decline in actual or predicted revenue over the period of a month, when compared with the same month last year, and that decline is related to COVID-19” (during the period January 2020 to June 2020). However, some might (particularly smaller councils with a high proportion of revenue during that period from fees and charges and income sources other than rates), so we encourage you to consider the possibility.

There is a robust process to review the circumstances of larger businesses (over 80 employees). These are considered on a case by case basis, can involve direct discussions and enable new information to be introduced progressively (ie, rather than one-off lodgement of a standard form).  This could apply to council applications and will allow detailed consideration of individual council situations, which it is recognised may vary considerably.

We also expect that any separately registered council subsidiary whose revenue (eg, from fees and charges) has been severely impacted by COVID-19 will find it much easier to demonstrate that they meet the revenue decline criterion.

Wage subsidy applicants must also demonstrate how they have met the criterion that “active steps have been taken to mitigate the impact of COVID-19”.  Published guidance on this criterion for businesses in general suggests that this could include:

• drawing from your cash reserves (as appropriate);
• activating your business continuity plan;
• making an insurance claim; and
• seeking advice and support from a relevant industry association.

Next week, the Finance Workstream will consider mitigation criterion further and, in consultation with relevant government agencies, develop and circulate some sector specific guidance for councils and their subsidiaries.

Epidemic Preparedness (Local Government Act 2002) Immediate Modification Order 2020

Today a modification to the Local Government Act 2002 was made to enable new members of council to make their statutory declaration (oath of office) at a meeting that is being conducted by audio or audiovisual link.

This modification is made under the Epidemic Preparedness Act 2006 and comes into effect tomorrow, 10 April 2020.

View this Modification Order in full on the New Zealand Legislation website.

This change complements the previous amendments to enable councils meetings by audio/audiovisual link. The Governance group continues to assess the local government legislative framework under the COVID-19 event.

Ministry for the Environment’s update: National Monitoring System

On 9 April, the Ministry for the Environment released the National Monitoring System (NMS) data for the year ending 30 June 2019. 

Due to the focus on COVID-19 at present, the Ministry has decided not to make any changes to the data that will be requested for 20/21. This means we will not be seeking feedback from you on the data request as we ordinarily would between now and June, nor will you need to make changes from the data collection system you have in place.  

We understand that you will be involved with your local COVID-19 response and recovery and that you will be prioritising the ongoing delivery of essential services. We anticipate making the request for the 19/20 NMS data in June 2020 as usual, but with an extended period of time to supply the data.

Stay local, save lives this Easter

Over the Easter weekend please encourage your communities to stay in their bubble and keep exercise local.

This means sticking to paths and parks close to home when exercising, and keeping two meters from other people at all times.

Driving to parks outside of the local area is a breach of the bubble rule.

Cars don’t need to stretch their legs - restrict car use to essential services work, shopping for food and medical needs.

If you have concerns that people are not following this advice over Easter, you should raise this with your local Police and consider what solutions are available together. Only the Police have the authority to establish and enforce road restrictions or checkpoints, if this is deemed necessary.