New $15m Covid-19 support package for struggling SA tourism and hospitality businesses
Thousands of small and medium-sized businesses are set for a major Covid lifeline, but large Adelaide hotels are worried it won’t be enough.
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About 3500 South Australian tourism, hospitality and other businesses are set for a major lifeline, as the state and federal governments unveil a new $15m Covid-19 relief package.
Australian Treasurer Josh Frydenberg and Premier Steven Marshall announced two new Covid-19 support grants on Monday, in a move aimed at helping SA’s struggling tourism operators, pubs and restaurants stay open in the lead up to hitting the 80 per cent vaccination target before Christmas.
But with grants worth up to $20,000, lobby groups have raised concerns it won’t be enough for large CBD hotels haemorrhaging cash during travel bans.
“Tourism and hospitality businesses have done it particularly tough as South Australia feels the impact of lockdowns in neighbouring states,” Mr Frydenberg said.
“But there is light at the end of the tunnel. By sticking to the National Plan, agreed to by state and territory leaders, we can safely ease restrictions and open up our economy.”
The new Covid-19 tourism and hospitality support grant will provide $20,000 lump-sum payments to affected businesses in those sectors with an annual turnover of more than $5m.
Grants of $10,000 will be available for businesses with an annual turnover of more than $2m.
Employers with a turnover lower than $2m can get $3000 grants and non-employing sole traders can get access to $1000 grants.
The support program will also be available to companies in the performing and creative arts industries, as well as taxi and car rental operators.
The $3000 and $1000 grants are expected to automatically land in struggling businesses’ accounts within seven days if they previously accessed funds from the Covid-19 additional business support grant last month.
Applications for the larger grants will open on Friday.
Business SA, the Australian Hotels Association and the SA Tourism Council all welcomed the new relief money, but warned larger employers could go under before the 80 per cent vaccination target was reached.
Business SA policy director Andrew McKenna said: “In absence of more substantial financial support, Business SA foreshadows that job losses and business failures may soon become apparent”.
Business SA estimates the tourism sector’s economic benefit has fallen 50 per cent, equalling between $50,000 and $350,000 in lost revenue per month for some CBD hotels.
Treasurer Rob Lucas said that was the “sad impact of Covid”.
“As we’ve said, we’d do all we could with taxpayers’ money to save as many businesses and jobs as we can, but the reality is, we’re not in a position to fund all businesses to keep all their existing employees there if there are no customers coming across the borders,” he said.
Mr Lucas said reaching the 80 per cent vaccination target was the ultimate solution.
AHA SA boss Ian Horne said the cash injection will be welcomed by small and medium businesses.
“However, for the larger (hotels), this falls well short of what’s going to be needed to sustain and maintain them, particularly if the borders are going to be closed until Christmas or late November at the very best.”
In a similar statement, SA Tourism Council chief Shaun de Bruyn welcomed the package but called for waivers on government fees such as land tax and payroll tax for big hotels.
The second new support fund announced on Monday is the Covid-19 business hardship grant for businesses in other sectors that have experienced a 50 per cent reduction in turnover as a result of restrictions and have not been previously eligible for recent help.
It will give $6000 for businesses with annual payrolls below $10m and $2000 for non-employing businesses. Applications will also open on Friday.
“These new grants will further support our hardworking small businesses who are the backbone of the state’s economy,” Mr Marshall said.
Finance Minister and SA Senator Simon Birmingham acknowledged tourism and hospitality businesses “continue to face challenging times” amid ongoing restrictions.
“As we move towards vaccination rates that will allow us to further open up, this support will ensure businesses are there on the other side to employ more South Australians and contribute to our ongoing economic recovery,” he said.
The state government will also increase the major events support grant by $75,000, providing up to $100,000 of help to organisers of cancelled or postponed major events.
Mr Lucas said more than $77m in cash grants had been paid to more than 27,000 SA businesses suffering from restrictions since July’s Modbury cluster lockdown.
Mr Frydenberg said $50m of Covid-19 disaster payments had been given to about 86,000 South Australian individuals to date.
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