Metlifecare board opts to repay $6.8m wage subsidy

AUCKLAND: Retirement giant Metlifecare says it will repay the $6.8 million wage subsidy, its new owner saying the return honours the spirit of the scheme.

The new board issued a statement yesterday saying it received the money in April but would repay it in full.

Chairman Paul McClintock said, ‘‘The whole Metlifecare team has done an extraordinary job in managing the Covid19 crisis and should be commended for their efforts.

‘‘Metlifecare maintained its high standards of care for residents while also supporting the safety and health of its staff throughout this challenging period. While Covid19 has created significant and lasting economic uncertainty . . . and Metlifecare did qualify for the scheme, EQT and the board has now determined that repaying the wage subsidy is the right thing to do.’’

Metlifecare is now owned by Swedish giant EQT, whose representative Ken Wong said it was only right to return the money.

‘‘EQT is very conscious this scheme was put in place by the Government to support vulnerable businesses through a period of unprecedented uncertainty.

‘‘Given the valuable work undertaken by all Metlifecare staff through the Covid crisis and the essential nature of all Metlifecare employees, EQT believes that it is in the spirit of the scheme to return the subsidy,’’ Mr Wong said.

The new board comprises Mr McClintock; former MP Jonathan Coleman, Kainga Ora programme director Ken LotuIiga; Bupa operational director Maggie Owens; Murray Jordan, who is also on the boards of Chorus, SkyCity, Southern Cross, Stevenson Group and the Starship Foundation; and EQT’s Mr Wong.

Metlifecare was established in 1984 and has 25 villages in New Zealand, mainly in the upper North Island.

EQT bought it for $1.27 billion in a controversial takeover opposed by former Metlifecare chairman Kim Ellis, the New Zealand Shareholders’ Association and investors Matt Goodson of Salt and Craig Priscott.

Metlifecare made a net aftertax loss of $33.7 million for the June 2020 year, compared with a $51.2 million profit the previous year. Yet revenue rose 7.7% and the loss was only on paper, due to valuers’ assessments of investment property. Those values rose $53.9 million in 2019 but this year fell $74.8 million.

Businesses are reported to have repaid hundreds of millions of dollars in wage subsidies they found they did not need.

By July, it was reported that nearly 10,500 recipients of the wage subsidy had paid the money back, totalling $323.6 million.

More than 10,000 companies have been audited to check they have met the rules of the Government’s wage subsidy programme.

On October 30, it was reported that more than $14 billion had been paid in wage subsidies, some of the larger recipients since reporting profits and paying dividends.

That has raised questions about eligibility requirements.

Ryman Napier received $780,500 for 136 employees. Other Ryman businesses applied for the subsidy under other names.

Summerset Management Group got $8.6 million for 1344 employees. — The New Zealand Herald

❛ Given the valuable work undertaken by all Metlifecare staff through the Covid crisis and the

essential nature of all Metlifecare employees, EQT believes that it is in the spirit of the scheme to return the subsidy EQT representative Ken Wong