Meat company wage subsidies saved jobs, industry says

Tuesday, 19 May 2020

The meat industry says the wage subsidy allowed it to save jobs.

A number of large meat processing companies that applied for government wage subsidies did so in order to ensure jobs were retained, the industry says.

However, Anzco Foods, Silver Fern Farms and Alliance Group have said they would repay any money that did not end up meeting the Government's criteria for the subsidy when the 12-week scheme came to an end.

Alliance group received $34.4 million in subsidies for 4913 staff.

Chief executive David Surveyor said the company had fixed operating costs and revenue had dropped significantly since the start of the coronavirus crisis.

“As we have said from the start, if we don’t continue to meet the criteria, we will return any unused funds to the Crown,” Surveyor said.

âWe fully expect to be audited by the Government,' Alliance chief executive David Surveyor says.

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The subsidy was being paid to workers to keep them in jobs and preserve income, he said.

“We fully expect to be audited by the government,' he said.

As a primary industry, meat processing was deemed an essential service during the level 4 lockdown.

Silver Fern Farms received $42.5 million in wage subsidies for 6161 staff.

Covid 19 had made processing 'substantially more costly and inefficient' and came at a time when farmers needed to undergo 'significant' destocking, Surveyor said.

Silver Fern Farms received $42.5m in subsidies for 6161 staff.

Spokesman Justin Courtney said the company had been monitoring operating conditions and was honouring its commitment to staff. Unneeded funds would be paid back.

'We are engaging with government in order to keep them updated on our progress given the situation has been so fluid through this period,' he said.

By early April, $4.8 billion had been paid out as part of the Government's wage subsidy scheme in only two weeks.

The subsidy was applied for at a time of deep uncertainty about the impact of the lockdown on the sector, including global market disruption and helped it keep people in work, he said.

Anzco Foods took around $18.8m for 2679 workers, chief executive Peter Conley said.

With the increased industry Covid-19 protocols the company had to 'move quickly' to provide a safe working environment, secure finances and retain jobs, he said.

Workflows were adjusted, production capacity reduced and costs were incurred, he said.

Three of Anzco's businesses were unable to operate, including its wholesale butchery, hamburger patty manufacturing and beef jerky operations.

'At times more than 600 employees were unable to work during lockdown,' Conley said.

Staff continued to be paid when there was no work available, as well as those in isolation, those older than 70 or those with vulnerable conditions, or who were caring for the vulnerable, he said.

Anzco used modelling ahead of its application that indicated it would meet the criteria. This had since been confirmed. Total revenue for April was 'significantly lower' year-on-year, he said.

The industry has been criticised for accepting the subsidies, despite being able to work through the lockdown.

Earlier this month the Meat Industry Association said total meat exports had reached $1.1 billion for the first time in March, up 12 per cent year-on-year.

Meat Workers Union president Mike Nahu said wide-spread redundancies in the sector had not taken place and seasonal layoffs that would normally be expected were saved because social distancing at the plants dragged out the killing season.