Covid 19 Delta outbreak: Frustration as businesses’ supply lines remain halted with split alert levels

Businesses are confused and concerned as many supply lines remain paused while the Government operates a split alert level system, keeping its economic powerhouse in lockdown.

Companies deemed non-essential such as Engineering Services Rotorua Ltd, a forestry equipment manufacturer, rely on suppliers in Auckland to maintain production and meet customer demand across the country.

But owner David Cox said his suppliers in New Zealand’s biggest city have been told they cannot operate and deliver him the required parts while Auckland remains in alert level 4 and the rest of the country at level 3. Northland will move to level 3 at 11.59pm today, Prime Minister Jacinda Ardern confirmed this afternoon.

“We make product that is quite sophisticated and it only takes one item that is not available and we can’t finish that product,” Cox told the Herald.

“If the lockdown in Auckland carried on our stocks would run out … and then we can’t finish a $300,000 machine that is sitting there waiting for one part.”

Auckland accounts for about 38 per cent of New Zealand’s GDP, according to Stats NZ data, while one of its largest industries is manufacturing.

Cox said the frustrating supply delays add to “the whole global trade mess”, while there is also confusion over the rules of whether and what companies in level 4 are able to supply customers in level 3.

“Most companies in New Zealand would have a supplier in Auckland,” he said. “They are saying they can only supply goods to people who are deemed essential.”

Businesspeople spoken to by the Herald in other industries, including construction, have said supplies could run out in a matter of days with Auckland remaining in lockdown. Builders also added the additional supply pressures will simply see the cost of building homes increase.

The Herald asked the Ministry of Business, Innovation and Employment (MBIE) for the official advice for businesses which rely on supply and trade across split alert levels, and if non-essential companies in level 4 can apply for an exemption to allow goods to be moved across the boundaries.

An MBIE spokesperson said freight and logistics services can operate at all alert levels but everyone still needs to keep travel to a minimum to reduce the risk of further community transmission.

“We expect businesses, traders and consumers to act responsibly,” they said.

“If you can’t complete the transaction that’s within the alert level rules you should wait until it is safe to do so.”

Freight and logistics services can transport both essential and non-essential products, MBIE said.

“Courier or freight company employees can travel, including across the level 3/level 4 boundary if they can show delivery dockets or have a business travel document.

“People can use contactless delivery to buy goods. That means someone living in Auckland at alert level 4 can buy any goods from a business or individual in alert level 3 so long as the alert level 3 business or individual is following the alert level 3 rules.”

Business and work travel across the boundary is “strictly limited”, Ardern said today.

“These tight restrictions appear to be working well,” she added.

Exemptions are available for personal travel across the borders and 384 applications have been made but about 95 per cent declined, director general of health Dr Ashley Bloomfield said today.

MBIE’s guidelines for businesses operating at level 3 are:

• No customers are on the premises (unless they’re one of a few exceptions)
• Employees must keep one metre apart
• Hygiene and cleaning products must be available
• A QR code or other record keeping must be available

Cox said the trade issues may see Auckland suppliers “bending the rules” in an effort to send goods to non-essential companies in level 3 regions.

However, MBIE sent a warning to any businesses attempting to make unsanctioned transactions.

The ministry said if someone believes a business is not sticking to the rules, they can report it at www.covid19.govt.nz/compliance or, if it is an emergency, phone 111.

“Complaints are triaged and sent to the relevant enforcement agencies to manage, such as the Police, WorkSafe, Customs or the Ministry for Primary Industries depending on the nature of the complaint,” a spokesperson said.

“When complaints are received that are relevant to MBIE, we contact the business, and remind them of the alert level rules. A serious or repeat breach would be referred to the relevant agency for enforcement purposes.”

A breach of the health order is an offence liable to imprisonment for a term not exceeding six months or a fine not exceeding $4000.

Further information about business travel across boundaries can be found on the business.govt.nz website.

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