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Kiwi companies that have claimed the government wage subsidy are coming under fire from some in their own industry for taking the money during an excellent season.
The industry expects a record harvest and exports doubled in March compared to last year.
Considered an essential service, workers were able to continue picking fruit and the packing houses continued to operate during the closure of level four.
Most kiwi companies have not claimed the wage subsidy, but according to the Ministry of Social Development website, at least three have, raising more than $ 2 million from each other on behalf of employees.
The $ 585 per week subsidy is paid to employers who expect a 30% drop in earnings, so that they can keep their workers for a period of 12 weeks. So far more than $ 10b has been paid, while at least $ 17.5 million is being reimbursed by more than 1,200 companies.
In the kiwi sector, Riverlock Packhouse received $ 666,352 for 96 workers, Baygold $ 939,000 for 134 workers, and Apata $ 478,000 for 68 workers.
Riverlock and Baygold say their earnings decreased by more than 30 percent, while Apata says they were overpaid by mistake and have been trying to pay the money back.
After Stuff asked questions, Riverlock said he would return the money.
Michael Franks, CEO of Seeka, a large post-harvest producer and operator, says the amounts paid were “obscene” and hurt the industry’s reputation.
While there was no doubt that costs had increased due to Covid-19’s social distancing requirements, for many companies revenue would increase this season due to higher volumes.
“There will be an impact on earnings, but that’s not what the scheme is for,” says Michael.
“The scheme is to keep people on the job, so if your business suffered a loss of income as a result of Covid-19, it could drive workers until they returned to business again. That is not the circumstance in our industry: we simply do not have enough workers, we have many businesses. “
Tony de Farias, president of the Opac company in Eastern Bay of Plenty, says he did not consider his business to be eligible for the grant.
“We all suffer from the perspective that we cannot run our operations at capacity … but we will end up in the final analysis packing the same amount of fruit so that revenue is not affected.” “
James Trevelyan, managing director of Trevelyan’s packinghouse and soft drink store, says his company had accepted a grant for vulnerable workers who couldn’t continue working, and completed it, but “it was never in our vocabulary” to claim the loss of income. .
He says social distancing requirements initially caused problems, but that was quickly resolved with the implementation of displays and other measures, and the ability soon returned to normal.
“The harvest has gone up, there is more volume to harvest, so how … we could be low in income, I’m not sure.”
Riverlock’s business manager Mike Ryan says revenue decreased more than 30 percent due to reduced capacity due to social distancing requirements, so the company had claimed the wage subsidy.
But Riverlock managing director Doug Brown, who is also president of New Zealand Kiwifruit Growers Incorporated (NZKGI), said that after Stuff started asking questions, the company had reviewed its eligibility for the grant.
“While Riverlock met the criteria specified at the time of the initial request, circumstances have now changed,” he says.
“As a responsible employer acting in good faith, the wage subsidy will now be reimbursed, a process that is now underway.”
Baygold CEO Carl Simmons says half of the company’s business was in orchard construction and new orchard projects, which was deemed nonessential and closed during the closure of level four.
Before applying for the wage subsidy, the company was advised by Deloitte and MSD also did an assessment before releasing the money.
Carl says that some, but not all, of the construction and new garden staff could be reassigned to pick kiwi and that the grant had been used to pay staff who were unable to work.
“However, we believe that the entire Baygold team will return to work within the 12-week period. Therefore, a refund of the unused grant funds is anticipated and we are in discussions with MSD on how that should be processed, ”he says.
He says they had hired Deloitte to conduct an audit of their use of the grant and that they “will invite MSD to review how we are using the grant to make sure we are doing the right thing.”
Stuart Weston, managing director of Apata, says his company received $ 478,000 in error. He believed he was entitled to about $ 67,000 to cover the wages of workers from recognized seasonal employers who were forced to isolate themselves when they arrived in the country and were unable to work.
“The day they paid it, we went back to them and said, ‘They’ve paid us too much money, how can we pay it back? “We have sent four emails and several phone calls, but to no avail.
“The moment they tell us how they want it paid, we will refund it to them.”
Stuart says overall revenue had not fallen more than 30 percent.
“We’re certainly going to take a hit, but so are everyone else, so we don’t complain.”
An MSD spokesperson says there was a recent increase in employers asking to make reimbursements, so there was a delay in returning some of them.
“We are working on your requests as quickly as possible.”
NZKGI Chief Executive Nikki Johnson says that most kiwi companies that sought government help sought to cover the wages of those considered vulnerable workers, due to their age or health.
Overall, it had been a good season.
“Export-wise things are going well. It looks pretty positive right now.”
-Things / Tony Wall
