Could a ‘hospo’ package be the key to industry recovery?
A detailed rescue package being pitched to Federal Treasurer Josh Frydenberg has outlined how the hospitality industry could be saved once JobKeeper ends.
Labelled ‘HospoKeeper’, the package would ensure that employees working for the nation’s worst-affected venues would continue to have their wages subsidised by taxpayers on a monthly basis.
Restaurant and Catering Australia chief executive Wes Lambert outlined the plan in a letter to Mr Frydenberg and Trade and Tourism Minister Dan Tehan, detailing how the sector was still being disrupted by restrictions, many of which continue to come with little to no warning.
“Whilst all of these actions are taken through following the best health advice available to governments across the country, they unfortunately leave thousands of businesses facing sustained losses and with the threat of eventual closure when JobKeeper ends,” Lambert writes.
“As Australia’s vaccination program is unlikely to approach completion until the end of 2021, it should be expected that these restrictions and distribution will continue until at least the end of the year.
“Whilst R&CA understands and respects the desires of the federal government to persevere with the end of the JobKeeper scheme in March, it is our strong view that further sector-specific support is required to ensure businesses, including their supply chains, stay open and continue providing jobs and economic activity for our nation.”
Under the HospoKeeper package, JobKeeper would be replaced for six months from April as part of a “short-term, targeted” scheme, with eligible businesses paid the current fortnightly JobKeeper rate of $1000 for full-time staff or $650 for employees who worked fewer than 20 hours a week.
Payments would be available only to “substantially affected” accommodation and food services businesses and would factor in restrictions such as venue density limits, caps on event numbers, working-from-home directions for CBD workers or interstate and international travel bans.
Business Activity Statements would also need to show a downward trend of 15 to 30 per cent in monthly revenue compared with pre-pandemic levels in 2019.
It has already been stated that international borders are unlikely to open until 2022, a direction likely to continue to have a large impact on the industry. However, Prime Minister Scott Morrison is yet to commit to any further stimulus, although a next phase of assistance is yet to be ruled out.
“We changed out of JobKeeper at the end of September (to JobKeeper 2.0) and what did we see happen?” Morrison said. “We saw 450,000 businesses get themselves off JobKeeper and more than two million Australians no longer needing taxpayer-funded support …
“Where we need to make targeted investments, proportionate, commensurate with the challenge, we’ve done that. That’s been our way of doing things.
“And so we’ll assess those things as we go forward.”
The Treasurer is yet to comment.
Irit Jackson, 20th January 2021
