COVID-19: new payment for up to 12 weeks for those who’ve lost jobs
Ministers Grant Robertson and Carmel Sepuloni announced on 25 May 2020 a new temporary payment to support New Zealanders who lose their jobs due to the pandemic.
The “COVID Income Relief Payment” will be available for 12 weeks from 8 June for those who lose their jobs because of the pandemic. Full-timers (normally working at least 30 hours per week) who have lost their jobs will be paid $490 a week, and part-timers (15 to 29 hours per week), $250. Those working less than 15 hours per week before their employment was terminated are not eligible.
A self-employed person can also be covered by the scheme if the business they run is no longer viable, with no prospect of work or income.
Payments will not be taxed.
Applications can be made online between the dates of 8 June and 13 November 2020. The payment is available to New Zealand citizens and to New Zealand residents who normally live and work here. It is for those who lose all employment any time between 1 March and 30 October. The relief payment will not be paid retrospectively for any period before June 8. So, a person who has lost their job after 1 March but before 8 June will be paid from when application for it is made.
There is income testing to determine eligibility. A person will not get the payment if they have a partner earning $2,000 gross or more per week in wages or salary. Likewise, a person who receives a redundancy payment of $30,000 or more (gross), or income protection insurance payments, or earnings-related ACC payments, will not be eligible. However, the amount of COVID Income Relief Payment is not affected by any non-work income (eg rental income) a person receives.
The payment is made weekly (or fortnightly for people receiving New Zealand Superannuation or Veteran’s Pension). For those receiving New Zealand Superannuation or Student Allowance, in most cases payment will be made to the eligible individual in a couple. For most others, the Ministry of Social Development will split the payment between both partners equally, even if only one qualifies.
A person cannot receive a main benefit at the same time as the relief payment, but if they are eligible for the latter, they might find it more advantageous to receive it. It is anticipated that many of the more recent recipients of Jobseeker Support will be in this category. Some who previously worked part-time may be better off remaining on a main benefit.
Recipients of the income relief payment may be eligible to receive supplementary and hardship assistance from the Ministry of Social Development. The COVID-19 Income Relief Payment is not treated as income for the purposes of Working for Families tax credits, student loan repayments or child support.
Recipients of this payment are expected to seek work or retraining. If they find work, the relief payment would cease, in contrast to main benefits which are abated in relation to income from other sources.
Minister Grant Robertson confirmed that work is under way on the possibility of a more permanent unemployment insurance scheme.
©2020 CCH New Zealand Ltd