‘No sign’ of Victoria retail reprieve: Zahra

Retail chief Paul Zahra warns of permanent closures in Victoria as lockdowns continue, and worries about end of federal stimulus.

Retail chief joins other business leaders in lamenting Victoria’s lack of consultation with business. Picture: Gaye Gerard

Australian Retailers Association chief executive Paul Zahra said there were “no signs” that the Victorian government will review its tough and slow reopening of the state’s economy, and complained that its “consultation sessions” with business were more like “information sessions”.

In comments that echo other business leaders’ unhappiness over the extension of Victoria’s coronavirus lockdowns, Mr Zahra said there couldn‘t be an economic recovery without a retail recovery.

Speaking at the National Press Club in Canberra, Mr Zahra said the Victorian government had adopted a “broad brush approach” to the entire retail sector, spanning hardware stores to hairdressers. A Bunnings store the size of a hangar was treated as the same as a small store in the CBD, he said.

Mr Zahra said there were no signs yet the Victorian government would change its speed and course out of stage four restrictions.

“There is no sign yet, we were called into what was classed a consultation session but were more like information sessions, unfortunately there was very little feedback that was taken on board at this point.

“I have a great relationship with the Victorian government, we want to continue that relationship, however we believe that we were asking for a progressive reopening in retail and what we got was a delayed reopening. As a result most of our members are small business, and we believe around 50 per cent of those small businesses in Victoria will permanently close.’’

Mr Zahra said consultation with the business community should have gone beyond health to a much broader conversation, but it hadn’t.

The former chief executive of department store David Jones said in hard-hit areas like Victoria, and in CBD locations, a lack of tourists and people working from home meant retail was “not tracking well at all”.

“We are starting to see the emergence of a two-tiered or two-speed economy - those recovering and those continuing to suffer.”

Mr Zahra emphasised the importance to the economy, jobs and retail of putting money into people’s pockets and households through policies such as JobKeeper and JobSeeker.

“You can’t have an economic recovery without a retail recovery. Close to every dollar a minimum wage earner spends ends up in the retail economy. We saw glimpses of this when during the GFC in 2008-2009, prime minister Kevin Rudd’s economic stimulus dollars went straight into the retail economy.

“Unfortunately, we are far from a retail recovery. Retailers have been surviving – not thriving.”

Mr Zahra said it was worrying to imagine what would happen when the effect of these support measures wears off.

“Recent research projected that the scheduled end of the JobSeeker payment after December will take the equivalent of $8.5 billion per year from the retail sector.

“The equivalent of 130,000 Australian retail jobs are also immediately on the line if we return the rate of the JobSeeker payment to its old base rate.”

He said the sector would like to see permanent support for JobSeeker or a similar scheme, with the tapering off of income support threatening employment and an economic recovery.

“It doesn’t make sense to return people who do not have work, to the poverty line.

“We recognise the positive impact of these support measures on individuals and the economy.

“Beyond JobSeeker, we are keen to see the bringing forward personal income tax cuts and improving childcare options and resourcing, we do need to make it easier for both women and men to have the flexibility they need to care for children.”