Small-business workers to get income compensation

8:49 pm on 7 September 2010

The Government is to provide income support to some workers who have lost earnings because of the Canterbury earthquake.

Prime Minister John Key announced the details of the compensation scheme after meeting mayors in Christchurch on Tuesday.

The support package will be offered to businesses with fewer than 20 employees that are unable to operate or pay their staff.

There will be a subsidy of $350 per worker per week, before tax, backdated to the date of the earthquake.

The money will be paid as a lump sum to the employer, initially for up to four weeks, beginning on Thursday.

If a company has loss-of-earnings insurance, it will be expected to use that before accessing the scheme.

Close monitoring promised

Initially, the subsidy will be paid up for four weeks; businesses can apply after that if they are still unable to operate.

Mr Key says it is estimated that between 2000 and 5000 companies will qualify for the subsidy. While the scheme does run the risk of abuse, he says, it will be closely monitored week by week by both Work and Income and the Canterbury Chamber of Commerce.

He says the Government feels larger businesses are in a better position to weather the earthquake and its implications but has not ruled out help for them.