Wednesday, 13 January 2021 15:55

Alliance pays back wage subsidy

Written by  David Anderson
Alliance chair Murray Taggart says following the company's annual returns it is now in a position to repay the remaining balance of the wage subsidy. Alliance chair Murray Taggart says following the company's annual returns it is now in a position to repay the remaining balance of the wage subsidy.

After being dogged by claims about its entitlement to the wage subsidy, the country’s largest meat processor will now fully pay it back.

Just prior to Christmas, the Alliance Group announced that it “had chosen to return the balance of the wage subsidy to the Ministry of Social Development (MSD).”

The company had already repaid $21 million of the $34m wage subsidy it claimed during the Covid lockdown and said it will now return the balance.

“From the outset, Alliance has been clear we would only use the wage subsidy in the way it was intended by government and our previous re-payments reflect this commitment,” chair Murray Taggart explained.

“Following the filing of our company accounts last month, the Alliance board believes the co-operative is in a position to repay the remaining balance. We acknowledge the support and certainty the Government provided to help us keep many of our people in jobs.”

Taggart added that the company had retained $1.9 million for the Leave Support Scheme payment to employees that were required to self-isolate or were unable to work.

Alliance had been under pressure to repay the subsidy following the move by rival meat processor Silver Fern Farm to pay it back and had been facing a private prosecution by self-proclaimed professional campaigner Simon Lusk for only returning part of the $34.3 million Covid-19 wage subsidy it claimed.

In September, Lusk sought leave of the court to bring a private prosecution against the South Island meat company’s non-executive directors for Alliance’s “disgraceful” failure to completely repay the wage subsidy.

Alliance – along with other meat processors – was declared as an essential food-producing service and permitted to keep operating during New Zealand’s March-imposed Covid-19 lockdown. In September, the farmer-owned co-op said it had repaid 50% of the wage subsidy claimed. It has since then paid back another $4m, leaving it $13m short of what it claimed in total.

In November, Alliance announced an underlying profit of $27.4m for the 2019-20. However, adjusted for a one-off historical wage claim of $20 million, its annual profit was only $7.5m before tax.

At the time, Alliance chief executive David Surveyor told Rural News Lusk’s claims were unfounded and show no understanding of the process being run by the Ministry of Social Development (MSD).

“Alliance Group has always been open and upfront about the wage subsidy application, which has been widely shared with the public. We have been in ongoing constructive discussions with MSD about the application of the subsidy and stated from the outset that we would return any funds not used to pay people.”

Alliance wasn’t the only meat company to claim the wage subsidy. Silver Fern Farms was paid $43.2m and the Anzco Group got $17.3m. Several other smaller meat companies also claimed it. Silver Fern Farms repaid the subsidy in full.

Meanwhile, other large meat industry players did not claim the subsidy, including Affco, Greenlea and Hellaby.

More like this

Mixed outlook for primary sector

After five years of growth, New Zealand's primary exports are heading for a drop in 2021 - but with a bounce back predicted in 2022.

Remarkable lambing in a challenging year

Despite Covid-19-related processing restrictions and a widespread drought in the first half of 2020, sheep and beef farmers despite achieved a near record 130.3% lambing percentage, slightly lower than spring 2019 where 131% lambing was achieved.

Alliance demonstrates agility in tough year

Shareholders at the Alliance Group Annual Meeting this week were told the cooperative showed agility in an unprecedented year as a result of Covid-19 and adverse weather events.

Featured

Merlo goes greener

Obviously not wishing to get left behind by some of its competitors, Italian manufacturer Merlo is planning to add to its green-liveried telehandler range- with another set of green credentials in the shape of an all-new, all-electric battery-powered Merlo e-Worker model.

 

Growing a family legacy

What started with planting some acacia trees 25 years ago has become a multi-generational passion for the Hunt family in Te Awamutu.

Moves to improve winter grazing requirements

DairyNZ says it supports recommendations to the Government from an advisory group looking to improve winter grazing rules for farmers and achieve better environmental outcomes.

National

Machinery & Products

Good growth year for Claas

While many sectors of the agricultural machinery were hit by the ravages of Covid-19, the effects of the pandemic did…

Green machine frugal on fuel

According to the industry respected independent DLG PowerMix test, John Deere appears to be the best choice of tractor for…

App takes pressure off

TRS Tyre & Wheel, owned by Trelleborg Wheel Systems, has introduced the TLC Plus App to the New Zealand market.

New MF 5S series arrives

Just before Christmas, Massey Ferguson quietly released details of the successor to its popular MF 5700S range in the shape…

» The RNG Weather Report

» Latest Print Issues Online

The Hound

Seriously?

Your old mate reckons the nomination of the New Zealand Dairy Industry Awards (NZDIA) management team as a finalists in…

Good riddance!

The Hound reckons 2021 is off to a rollicking start with news that professional whinger and anti-farming drone Martin Taylor…

» Connect with Rural News

» eNewsletter

Subscribe to our weekly newsletter