Unprecedented COVID-19 crisis cripples local businesses

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While shelves in supermarkets and pharmacies have been left bare by panic buyers, many other businesses have suffered a sharp downturn due to the impact of coronavirus on community behaviour.

Canberra Business Chamber (CBC) CEO Graham Catt told Canberra Weekly the COVID-19 downturn follows one to three months of tough trading for a lot of businesses.

“Many of our businesses have been doing it tough since last December or January with bushfires, smoke haze and then hail. We’ve dealt with that and the impact on the behaviour of the community.”

According to Mr Catt, for hospitality, tourism and retail sectors – all of which particularly felt the pinch over summer – this most recent decline is “really significant”.

“It’s hard to put a figure on what that will mean for business closures, but we were already hearing figures of downturn from certain businesses in February of 30-40%.

“Moving forward, that’s going to have a very real impact on their takings; 50% is not an unreasonable estimate.”

Scott Leggo Gallery owners Scott and Phillipa Leggo told Canberra Weekly it’s been a challenging time for small businesses of many forms, particularly those who interact face-to-face with their customers.

“People are either not out, and if they are out their propensity to buy is less, and I think there’s misinformation out there about businesses not being open as well,” Mr Leggo said.

He said that within Canberra’s small business community, people are doing what they can to assist one another.

“People are understanding they may need to be more flexible on pricing or payment terms so that we can get through this together.

“We don’t want to just suddenly stop spending money either, because that compounds the situation,” he said.

“It’s not all doom and gloom; everyone is pretty upbeat and positive, they’re just cautious and weary,” Mrs Leggo added.

Scott Leggo Gallery owners Phillipa and Scott Leggo said it’s been a challenging time for many small businesses, particularly those who interact face-to-face with their customers.

ACT Government respond with economic package and restriction of trade

On Friday 20 March, the ACT Government announced a $137 million economic survival package, including a number of measures to support small to medium businesses.

For businesses who own their premises, the package contained a rebate on the fixed charge for 2019-20 on commercial rates for properties with an AUV below $2 million.

For businesses who lease premises, there is a six-month waiver on payroll tax for hospitality, creative arts and entertainment industries, waiving food business registration and liquor licensing fees (excluding off-license) and outdoor dining fees.

There will also be a $750 rebate to help small business owners with power bills.

ACT Opposition Leader Alistair Coe said the stimulus measures do not reflect the urgency of the situation, given a number of the measures won’t come into effect for some time.

“This is an extraordinarily difficult time for small businesses who are struggling to keep their doors open and staff employed … a $150 rates rebate will not arrive in wallets until August or September.”

ACT Chief Minister Andrew Barr said he will review the Federal Government’s next stimulus package to inform his government’s further economic response in the weeks ahead.

On Monday 23 March, the temporary closure of non-essential activities and businesses in the ACT was announced to “help slow the spread of COVID-19”.

“This reflects the decision made at National Cabinet on non-essential service closures and maintains consistency with the NSW approach,” Mr Barr said.

“In regards to the shutting down of non-essential services to protect public health, the ACT and NSW will be aligned.”

In the ACT, the following facilities were restricted from opening from midday 23 March: pubs and registered clubs; gyms and indoor sporting venues; cinemas, entertainment venues, casinos and night clubs; and religious gatherings and places of worship (excluding small weddings and funerals that comply with the one person per 4sqm rules).

Restaurants and cafes have been restricted to takeaway and/or home delivery.

Mr Barr also encouraged any business that can transition to virtual work arrangements to start that process “as soon as possible”.

Canberra Business Chamber CEO Graham Catt looks pensive during COVID-19 crisis
Canberra Business Chamber CEO Graham Catt: government support “must flow urgently to help keep as many businesses as possible afloat”.

Current measures ‘won’t go far enough’

Mr Catt said more support is needed than the currently announced measures to ensure businesses can survive long-term.

“There’s no way to sugarcoat this, the business support measures that have been announced, while welcome, won’t go far enough for the tourism and hospitality industry, and the many small businesses that supply them.

“We welcome Government assistance to help businesses keep their people, but now we have to face the difficult reality that we cannot save every business or every job.

“Nearly two-thirds of Canberrans in jobs are employed by the private sector … support measures announced by both the Federal and ACT Governments must flow urgently to help keep as many businesses as possible afloat,” Mr Catt said.

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Canberra Weekly Real Estate
Canberra Weekly Real Estate