Wage subsidy glitch: Accountant shocked by MSD response to system outage

An accountant who called MSD to help his client claim the wage subsidy after the Government’s website went down for hours ahead of the application deadline says he was shocked by the unsympathetic response he got.

Karl Ruby, an associate at accounting firm Matley in Tauranga, sat on the phone for more than an hour to get through to the Ministry of Social Development on Friday morning.

“The lady I spoke to was pretty rude. She goes ‘well he has missed it’. I said but there was a glitch last night and it wasn’t well known it [the deadline] had been rolled to 7am – she goes ‘oh well, it’s closed’.”

Ruby said the woman also asked what his client had been doing for the last 14 days – the period in which the applications had been open for.

“She basically implied he has been sitting around doing nothing and he should have just applied for it.”

But Ruby said while it was easy for retailers to claim the wage subsidy right from the start of lockdown other businesses needed to wait to make sure they met the criteria.

“Our advice to them was make sure you wait the full 14 days to ensure you are under that 40 per cent because the problem you have got is, the MSD declaration says if you provide a false declaration you have effectively committed a criminal offense.”

Applications for the first tranche of the August 2021 wage subsidy were meant to close off at 11.59pm on Thursday night.

But a technical glitch caused by human error meant anyone trying to apply between 8pm and 10pm was told applications had closed.

The website reopened for applications shortly after 10pm with a notice extending the deadline to 7am Friday morning.

Business adviser Geoff Neal told the Herald he doubted many would have seen the late-night extension leaving thousands of business owners feeling stressed and missing out on the money which is designed to be paid out to workers to help keep them employed.

“How many businesses would have stumbled across that webpage before then? Winz again looks to have also failed to email businesses with this information.”

Neal said the Government needed to front-foot the mess with a proper apology, deadline extension and communication out to businesses already on their database.

Deputy Prime Minister Grant Robertson noted the glitch at the 1pm press conference but did not apologise for it.

“I do want to note that due to an administrative error the website for this was closed last night for two hours between 8pm and 10pm.”

Robertson said if there were any businesses affected by that closure they should get directly in touch with MSD.

Jason Dwen, general manager centralised services at MSD said the issue was the result of human error and was due to work taking place on the website in preparation for the second iteration of the wage subsidy scheme which opened at 9am on Friday morning.

“We are sorry about this.

“We’re working through a process to deal with people who feel they have missed out.A complaint form is available on the Work and Income website and we’ll be in contact as soon as possible to discuss.”

Ruby said he would try calling MSD again after hearing Robertson’s advice but the problem was MSD did not have enough call centre staff.

Neal said many businesses couldn’t measure actual fortnightly revenue losses until the end of Wednesday, September 1/start of Thursday, September 2.

“Yet the Government put a deadline of just 24 hours to get these calculations done and applications submitted. All at a time when financial and mental stress has never been higher for Kiwi SMEs, and they’re having to scramble every stressful day.”

He said businesses should get at least a fortnight after the end of a fortnight period to apply, if not a month.

Ruby said getting the wage subsidy could be the difference between whether some businesses would be able to open again after lockdown ended.

So far this lockdown 242,600 wage subsidy applications have been approved with total payments of $998 million.

This time around businesses can only apply for two weeks of wage subsidy at a time.

As well as the wage subsidy many businesses may be eligible for the Resurgent Support Payment.

It is worth up to $1500 plus $400 per full-time equivalent employee, up to a maximum of 50 full-time employees (so up to a total of $21,500) and is a one-off payment available for each lockdown through applying to Inland Revenue.

Robertson on Friday announced an easing of qualification for this subsidy with the amount of time a company has to be in business for dropping from six months down to one month.

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