Unknown future of Covid-19 leave scheme

The Covid-19 Leave Scheme was introduced to ease financial pressure off workers who were isolating because of the virus. Photo: Andy Jackson/Stuff/File

There is still no decision on the fate of the Covid-19 Leave Support Scheme, with Government officials saying discussions are ongoing.

The scheme was introduced in 2020 as part of the $73.7 billion Covid-19 Response and Recovery Fund.

It was set up to lessen the burden on employers and employees who were absent from work because of Covid-19.

The scheme allows employers to apply for payments of up to $600 per week for those working 20 hours or more, or $359 per week for those working less than 20 hours, to help cover wages if they were self-isolating.

Applications are open to businesses, self-employed and sole traders, charities, non-government organisations, incorporated societies, local government, post-settlement governance entities and state-owned enterprises could apply.

Public sector employers are not eligible.

The scheme also supported household contacts, but that was removed in September with a change in isolation requirements.

Last year, Cabinet discussed the future of the scheme with the epidemic notice, set in March 2020, due to expire.

A total of $50m was allocated by Government in Budget 2022 for the scheme, with about $8m paid out since January.

Minister for Social Development (MSD) Carmel Sepuloni says discussions are ongoing in regard to what's next.

Minister for Social Development Carmel Sepuloni says the scheme will continue until further decision is made. Photo: Robert Kitchin/Stuff.

'It'll continue to be available for people until further decisions are made,” she says.

More than 561,000 jobs have benefited from the scheme in the last two years.

Since March 17, 2020, a total of 561,330 applications were approved and $764.3m paid out as of January 13, according to the latest MSD data.

Last year, more than $590m was paid out across 500,000 jobs.

March last year recorded the highest monthly pay out, with 142,137 jobs supported, 26,073 of which were sole traders. December's numbers were 30,417 in approved applications.

E tū Union director Mat Danaher says the scheme should be retained by Government for as long as possible.

He says thousands of union members have benefitted from the support and were still using it.

'It's fair to say that ultimately, the scheme was better than any alternatives. The fact is the Opposition wasn't offering anything as robust to help workers impacted by Covid,” Danahar says.

'However, we can't ignore the fact it's inequitable by design, there were disparities for low income earners.”

He says there was confusion earlier on when the scheme was implemented about how much an employee would be paid.

'The employee should get 100 per cent of their pay because it wasn't a fault of their own that they couldn't afford to attend work.

'The welfare system at the moment doesn't work for low paid workers. The scheme has shown that there is appetite out there – a lot of employers used it in good faith, and when our members faced an issue, they could change that with the help of the union.”

He says if the scheme is kept focused, and eligibility strict, it could be around for longer.

'I am not surprised if Government were discussing it's future, or parts of it, because there's little use to it now, with other schemes in place as well,” Mackay says.

'It was definitely useful, but I'd suspect it's being used less. Businesses now are screaming out for more workers.”

Mackay says the scheme had played its part.

'They've hit the target, and now it's whether it should stay, and for practical reasons, keep it.”

- Torika Tokalau/Stuff.

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