There are many businesses outside of New South Wales that are experiencing financial challenges because of the NSW Covid mess. These are businesses that usually derive considerable revenue from selling to NSW businesses.
Talking with a couple of retail business suppliers this week, they say that orders from NSW clients have all but stopped for the last 4 to 6 weeks. If they supplier businesses were in NSW, they’d qualify for significant financial support. Since they are outside of NSW and not in a lockdown area, they are not eligible.
One supplier told me that this lockdown in NSW is different to what they have seen through Covid til now in that it is the first time there has boon such a drop in orders from retailers.
NSW retailers are, naturally, being cautious with ordering. This is impacting their suppliers, plenty of whom are located outside of NSW. This is where the current financial support grant process is challenged.
It’s time for the federal government to see the NSW mess from a federal lens.
I agree Mark there needs to be a federal response. The problem in NSW is that the outbreak is widespread & out of control. Unlike last year there is very little business support from the Federal Government ie no Jobkeeper, no Cashboost payments, no insolvency protection and until last week no rental code. Yes they are supporting individuals through their disaster recovery payments but this money certainly is not getting to retailers due to the home lockdown laws. At the same time I have noticed that the ATO has commenced their collection activities and banks are calling in their Govt backed COVID business loans. Shopping Centre landlords are now having serious conversations about their deferred rental payments. This is a financial disaster quickly unfolding and the Federal Government should be called out for their lack of support this time around.
Yes, Steve, it’s a mess. I think the commercial disruption is at a point that the federal government should provide immediate financial support to businesses up to an annual revenue threshold of, say, $50M. It could be a refund of the last quarter GST collected or something similar tied to business activity. I’d like the state governments to do similar in terms of payroll tax.
No application needed, just money in the bank by the governments to businesses.
Businesses themselves are challenged, which is stopping them ordering, using their own pain on to their suppliers. This is leading to a broader issue yet to fully hit.
Wouldn’t the suppliers affected by the situation in NSW be subject to allowances and payments from their home State ?
An overall drop in sales no matter where those sales were lost from ?
You ppl are much more experienced in this stuff than me…..just asking 😉
Unfortunately not, Lance. The grants kick in when a state is in lockdown. A WA business with a sales decline of 50%, for example, because of NSW and VIC lockdowns, gets nothing. It’s a failure of leadership federally to understand the whole of the Australian economy impact.
Let’s also not forget the embarrassment that the NSW government is now experiencing with having to implement the systems to process business relief payments. Meanwhile thousands of small businesses are going to the wall awaiting payments. With the federal systems already in place the NSW government should never had been forced to reinvent the wheel. Frydenberg did a fantastic job last year but he and his government will be remembered for how they finish the game not how they started. As Mark has illustrated the economic damage will quickly spread to other states unless the Feds step in..
Steve, the NSW govt weren’t forced to reinvent the wheel, the NSW treasurer demanded that the NSW Govt take control of all payments to small businesses. This was so all credit for the payments could reflect on the State rather than federal Govts
The NSW Government has taken control as have all the other States . They demand their own soveriegnty .
The onlyt mistake Morrison made was to for a National Cabinet with the Labor versus Liberal State leaders claiming individual control.
Coudn’t work and isn’t working. State by State is where the effective push is with the Country Nationally footing the bill.
Either way blame never solves the problem nor does it correct it for the future as history has shown. There are other things that need addressing than political bias.
Mark,
That’s the beauty re opinion,each one of us have our own and as Christopher Hitchins would say “Arguably” neither is right or wrong it’s your opinion that matters.
I disagree Graeme about the NSW Government and control. They are yet to demonstrate that.
Mark, my perspective is that the Premier allowed margin for individual self discipline. She explained this in press conferences over and over again. No avail.
Gladys now has no choice than to dictate terms as self discipline hasn’t worked.
We by example see this every day within our industry in another dimension, howver with the same result.
No matter how much you appeal to the upper level of self responsibilty, the take up is NPT the majority.
Sad isn’t it? yet it does not stop one from trying.
Gladys is this type of person. Yep! she’ll lose – the masses want blood.
Do you think with 800 odd deaths Victoria handled it better? Nope they did the best given the Circs.
It’s not the individual in control that is to blame when the subject (virus) is still unknown.
However, as I say it is one opinion verus another but please don’t single out one State because of political bias against another. We are in this together with our respective leaders handling it the best way they can. After all the subject matter is unkown and has only hindsight verification of the best way to handle it.
Sorry Shayne I disagree. Frydenberg made it very clear firstly to Victoria and then to his “allies” in the NSW government that he did not want to reintroduce Jobkeeper. For the sake of thousands of NSW small businesses the NSW government decided to go it alone. Having now made dozens of applications on behalf of my small business clients the NSW Jobsaver and Business grant application system is a mess and the task was drastically underestimated by the NSW Government. A Federal response was required but on this occasion Frydenberg and his mates did not care. The other problem here is that the lockdown rules are particularly punitive on small business. Big business such as the banks and Tabcorp continue to see the lockdowns as ways to increase their bottom lines. The only bank in my town has taken the opportunity to ‘temporarily close’ for the welfare and safety of their employees. They won’t be back. As Mark has pointed out Tabcorp continues to use the lockdown to drive their online sales growth. No compensation or thought for their franchisees. Frydenberg continues to struggle to see what’s going on here in his economic numbers.
Steve,I share your view of events with small business as I too have much contact sometimes daily with with newsagents, Metro City and Country alike. Yes, it’s a problem but part of tye problem is not COVID oriented it’s a commercial competitive one. NewsCorp (get’s a bag here especially for trying to better the circumstances of electronic media versus their Print Media with the biggest cost being distribution to the end user -the subscriber) we have suffered as in being the news- agent in NSW Sydney Metro and now infiltrating throughout the rural sector as well. Tabcorp, Banks (nothing new with Banks closing unprofitable outlets) or combating expenses by reducing same as electronic/digital services become increasing used due to COVID time demonstrating a need for this.
Our records show that newsagent point of sale for Lottery products, Instants and Lotto Sales and Commissions are up. Now this may not continue as the restrictions become more enforceable or that may.
If we feel that Tabcorp are being unfair then maybe every supplier to general retailers of product that sell wholesalke are equally unfair. Welcome to the real World of competition.JB HI FI supreme retailers and many more have website price different to those on-line. There are deals for specialist Groups as well, yet their retail sale are climbing.
Lotto is going great for us and in many newsagents so are daily newspaper sales (some not all) this envious foot traffic on a daily basis needs to be cultivated into the selling of other products of which I am not going to go into as Mark does this consistantly and well even though he doesn’t have lotto traffic to milk.
In answer to the point you make is we too can “continue oops! start to use lockdown and our ” essential service” tag to push for more sales and the conversion from the traffic they provide.
the old saying “The grass is greener on the other side of the fence” can be reversde if “we try watering our own”
It is hard to keep track of all the funding announcements. If only they invested that much energy in actually delivering.
NSW COVID-19 Support Package
Note
Joint media statement with
The Hon Scott Morrison MP
Prime Minister
The Morrison Government is upgrading its national response to COVID-19 outbreaks with increased weekly payments for households, and boosting business cash flow to get them through extended lockdowns.
The new national arrangements have been developed following close cooperation between the Commonwealth and NSW governments to ensure additional support is targeted and rolls out as quickly as possible under a new cost sharing agreement.
The support package will see an increase in the COVID-19 Disaster Payment from week four of a lockdown and a 50/50 cost sharing arrangement between the Commonwealth and the NSW Government for a new and expanded small to medium business support package, implemented and administered by NSW.
This level of support will apply nationally to any state or territory that experiences an extended lockdown beyond week three following the declaration of a Commonwealth hotspot.
COVID-19 Disaster Payment
The Commonwealth will enhance and expand the support available to NSW and other states that experience an extended lockdown.
Specifically, the Commonwealth will:
From week four of a lockdown because of a Commonwealth declared hotspot, the COVID-19 Disaster Payment will increase from $500 to $600 each week if a person has lost 20 hours or more of work a week or $325 to $375 each week if a person has lost between 8 and 20 hours of work.
Make the COVID-19 Disaster Payment a recurring payment for approved recipients for as long as the Commonwealth declared hotspot and lockdown restrictions remain in place. This will remove the need for recipients to re-claim for each seven day period of a lockdown.
Amend the COVID-19 Disaster Payment so that a person would be eligible for the payment, including where they are still working, provided they have lost more than 8 hours or a full day of work.
From 18 July 2021 the COVID-19 Disaster Payment will be available to those outside Commonwealth declared hotspots in NSW that meet the criteria for the payment.
The NSW Government will fund any payments outside a Commonwealth declared hotspot, with the Commonwealth continuing to fund payments to recipients in a Commonwealth declared hotspot.
This arrangement will be available to other states and territories for future lockdown as a result of a Commonwealth declared hotspot.
Information about how to apply for COVID-19 Disaster Payment can be found on the Services Australia website.
Small and medium business support payments
From week four of the lockdown, the Commonwealth will fund 50 per cent of the cost of a new small and medium business support payment to be implemented and administered by Service NSW.
Eligible entities will receive 40 per cent of their NSW payroll payments, at a minimum of $1500 and a maximum of $10,000 per week.
Entities will be eligible if their turnover is 30 per cent lower than an equivalent two week period in 2019.
The new small to medium business support payment will be available to non-employing and employing entities in NSW, including not for profits, with an annual turnover between $75,000 and $50 million.
To receive the payment, entities will be required to maintain their full time, part time and long term casual staffing level as of 13 July 2021.
For non-employing businesses, such as sole traders, the payment will be set at $1,000 per week.
Businesses can register their interest from 14 July 2021 at Service NSW.
The assistance will cease when current lockdown restrictions are eased or when the Commonwealth hotspot declaration is removed.