Upper limit of Business Guarantee scheme 'arbitrary', says National

National is welcoming the Government's announcement of a $6.25 billion Business Finance Guarantee Scheme, but called the upper limit "arbitrary". 

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Today, Finance Minister Grant Robertson launched the scheme which sees the Government underwrite bank loans for small and medium-sized businesses grappling with the impact of Covid-19. 

It will have a limit of $500,000 per loan, for firms with a turnover between $250,000 and $80 million per year. The Government will carry 80 per cent of the credit risk and the remainder by banks.

"National has been calling for a business lending guarantee scheme for weeks and we welcome this announcement," National's finance spokesperson Paul Goldsmith said. 

"However, the upper limit of $80 million turnover seems arbitrary. There will be bigger firms with large numbers of employees that may need some assistance."

National's leader Simon Bridges also spoke about the wage subsidy scheme, which jumped from $5.1 billion up to $9.3 billion yesterday - pulling the worth of the entire business package up to $16.3 billion. 

The $150,000 business cap was also removed completely and will also include charities and non-government organisations. 

"One piece of feedback we're getting is the jobs subsidy isn't necessary exactly meeting the mark and keeping people in business," he told media. 

"I think the jobs subsidy is a good thing... but can we go through the settings and make sure that the money is being spent and going where it will make that difference and keeping workers in jobs?"

Mr Goldsmith said they had |growing concerns about whether the final design of the scheme is as effective as it could be at keeping New Zealanders in jobs now that we have moved to a full lockdown".

"We encourage the Government to closely monitor the effectiveness of the scheme; it may be insufficiently generous to stop widespread business closure and job losses."