ARA calls on other jurisdictions to follow NSW's lead with targeted support for retailers

ARA calls on other jurisdictions to follow NSW's lead with targeted support for retailers

The New South Wales government’s move to extend rent negotiation rights for the state’s small businesses is a welcome move according to the retail industry’s peak body, but the Australian Retailers Association (ARA) says more can to be done nationally.

Announced yesterday, the extension of rent negotiation rights in NSW will last until March 13 for for SMEs (small-medium enterprises) with an annual turnover of less than $5 million.

In addition, provisions in the Leasing Code of Conduct will continue with rent relief mandated in proportion to a business’ decline in turnover.

The ARA says it welcomes the move by the NSW government, but notes retailers in other states are being left behind by leasing codes of conduct which have now expired.

For example, Victoria's Commercial Tenancy Relief Scheme ended on 15 January, leaving small businesses vulnerable to significant cashflow challenges in the first quarter. On Wednesday, retail business advocates in Melbourne's Chapel Street Precinct described a perfect storm of deferred payroll taxes and wage increases combined with staff shortages and closures due to COVID infections.

ARA CEO Paul Zahra said leasing protections should be re-enacted in other jurisdictions with small businesses struggling to keep their doors open due to staff isolations and increasing supply chain costs. 

“We’ve entered uncharted territory with Omicron and small businesses are dealing with a fresh wave of challenges with tens of thousands of people being forced into isolation every day,” Zahra said.

“This is taking an enormous toll on the retail workforce and small businesses who’ve had to limit their trading hours or close altogether.

“Rent is a significant pain point for small businesses, and we welcome the decision of the NSW Government to extend leasing protections through this difficult period. Given the widescale impacts of Omicron, we would like to see this extended to small businesses with a threshold of up to $50 million as was previously in place. We are also calling on other states and territories to follow suit and enact similar support measures.”

Zahra said the issues for SMEs are magnified because of the lack of government support compared to other times during the pandemic, now in its third calendar year.

“We have not seen the pandemic impact the sector on this scale and for the first time retailers are having to navigate these impacts with almost no support from governments,” Zahra said.

“It’s clear that the impacts of Omicron will be ongoing and that targeted support packages will be needed from governments to support small businesses through this unprecedented challenge.”

The CEO also welcomed National Cabinet’s decision to allow foreign students to work extra hours, along with the extension of close contact isolation exemptions to a wider range of industries.

“Allowing foreign students to work extra hours is a positive step, but we need to get more people back to work sooner where it is safe to do so,” Zahra said.

“We welcome the easing of close contact isolation requirements for essential workers along the food supply chain but we’d like to see these exemptions expanded across the supply chain and the broader retail sector to help reduce stock-outs and staffing shortages.”

Updated at 4.00pm AEDT on 14 January 2022.

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