Covid 19 coronavirus: emergency accommodation providers claimed wage subsidies and government payments

By Nita Blake-Persen of RNZ

Motels and lodging providers that receive millions of dollars in emergency housing payments from the government have also claimed tens of thousands of dollars in wage subsidies.

An Auckland property management company received more than $ 12 million to house the homeless over the past 18 months.

But he also managed to get more than $ 50,000 in wage subsidies, and the Ministry of Social Development (MSD) is now investigating a formal complaint about the money.

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When the country entered a level 4 lockdown in March, making sure everyone had a place to stay was a priority.

Housing Minister Megan Woods announced $ 107 million to house poor sleepers during and after the pandemic.

That money was in addition to MSD funds already flying through the door to house the homeless.

Among the recipients was Silverfern Property Services, an Auckland property management company that provided accommodation for people in private rentals.

Between January 2019 and the end of June 2020 he received more than $ 12 million in payments.

Auckland social worker at ME Family Services, Alastair Russell, said that many of the properties were in terrible condition and the costs were enormous.

“The income that these companies have accumulated at the expense of exploiting the homelessness problem and the needs of the community, this is, at that level, deplorable.”

More than $ 50 million was paid to the top 10 vendors in the 18 months through June.

While Silverfern Property Services received the highest payment during that time period, four of the top 10 housing providers claimed the wage subsidy as well as their emergency housing grants.

“There is a constant reliance on a free market to solve the need for social housing, and how many times do we have to see examples where that model of a free market solution simply enriches a few and continues to leave people without housing resources and permanent housing sources? “

Businesses receiving the government wage subsidy had to have an expected or anticipated drop in revenue of 30 percent, which increased to 40 percent during the extension of the wage subsidy.

Independent tax investigator Michael Gousmett says he has a hard time seeing how motels, hotels and property managers that have been receiving a growing number of homeless people rate.

“There seems to be an element of morality missing from some people’s thinking here about what this process is about.”

He hoped that companies that found they didn’t need the money would pay it back, with interest.

“The wage subsidy, I think, was a great idea, but at the end of the day it has certainly been fixed and there is certainly a need to take care of smaller companies.”

Silverfern Property Services is no longer operating. He said that after the first lockdown was lifted, MSD removed all of its clients from its properties.

Speaking to RNZ, the company defended the condition of the properties it provided to MSD and said it planned to repay the wage subsidy after realizing that it no longer met the criteria for receiving it.

In a statement, MSD confirmed that it had received a complaint about Silverfern Property Management. It also audited two other accommodation providers in relation to the wage subsidy, but says no action was required.

– Checkpoint, RNZ