Last night’s Government announcement that Auckland will return to Level 3 restrictions (and the rest of the nation to
Level 2) due to confirmed cases of community transmission in South Auckland, is another hit for the already struggling
hospitality industry and if the lockdown is extended, will likely mark the end for some operators says, Hospitality New
Zealand.
Hospitality New Zealand Chief Executive, Julie White, says for Auckland hospitality operators, the uncertainty of when
they can reopen will see a huge loss of working capital – with many having to literally pour product down the drain or
throw it away.
“Today’s focus for our Auckland hospitality operators is how to safely shut down their businesses, yet again. In light
of Auckland’s move to Level 3 today and the strong likelihood that this lockdown could be extended beyond the three
days, bars will have to pour their kegs down the drain and restaurants will be working out what fresh produce can be
saved - it’s not as simple as turning the lights off and locking the doors.”
For the rest of New Zealand, the Level 2 restrictions are also limiting for key hospitality operators as the requirement
for single servers and 100 people maximum per venue, reduces potential income and comes with additional staffing costs.
“The industry has already faced significant challenges in continuously adapting their services at each Alert Level,
leaving many operators with reduced profit and increasing debt. Without any certainty around when we can return to
business as usual, the sector urgently requires targeted support and for the Wage Subsidy to be extended beyond 1
September. The Government must provide urgent relief packages and allocate some funding from its $14 billion COVID
Response and Recovery Fund to the hospitality sector,” says White.
It’s a disappointing setback for the hospitality industry, as data released by Statistics NZ just yesterday showed that
retail card spending in the sector hit the strongest level for a July month since data was recorded. While accommodation
spending was down $30 million (-16 percent), food and beverage services were up $92 million (11 percent) compared with
July last year.
“These numbers have supported what our members had been suggesting - a glimmer of hope that recovery is near, and on
track with our strategy for the sector to ‘Survive, Revive and Thrive’. People are enjoying going out and supporting
locals, and whilst some regions who are highly reliant on international visitors are still doing it tough, there’s
immense support in the community for these businesses. Let’s hope that support long continues,” concludes White.