Peak industry organisation, Restaurant & Catering Australia (R&CA) says the decision to progress the gazettal of two additional public holidays in Victoria will hurt business and cost jobs in hospitality.
Minister for Small Business Philip Dalidakis announced Grand Final Friday and Easter Sunday will be officially introduced via a notice in the Government Gazette this week. This is despite the government’s Regulatory Impact Statement (RIS) indicating the introduction of both public holidays would cost the state economy $898 million in lost productivity.
R&CA CEO said the decision is “ludicrous”.
“The decision to progress the gazettal of both public holidays is ludicrous when the benefits do not outweigh the cost.
“The RIS identified small businesses – particularly those in the hospitality industry – will be the hardest hit as wage costs form a greater proportion of their overall operating costs on these days. Prohibitive labour costs will force businesses to close, costing the state economy jobs and lost tourism expenditure on these days,” Hart said.
“The decision hardly makes good economic sense at a time of rising unemployment, particularly youth unemployment. The Andrews government has not listened to the concerns of small business or heeded the warnings of its own RIS.”
If Victoria does get these two additional public holidays, it will have more public holidays than any other state.
The latest Productivity Commission report, released on 4 August, recommended a flat penalty rate be applied across weekends for the hospitality, restaurant and caf industries – a move which R&CA supports.
"If Sunday penalty rates were to be brought into line with Saturday penalty rates, this would immediately result in operators of accommodation businesses employing more staff,” Hart said.
"Lower penalty rates on Sundays would also see the re-opening on Sundays of restaurants and cafes in accommodation businesses because it would be much more affordable for operators to do so. Lower penalty rates on Sundays would be the first step in helping Australia to catch up to other lower-cost international tourism destinations which are on our doorstep.”
Earlier this month Hospitality published an article by Alan Duncan, director at Bankwest Curtin Economics Centre, which looked at whether or not penalty rates are causing foodservice businesses to close on weekends and public holidays. It read “It is true that there is feedback from some restaurants and cafes that they are closing due to the high cost of Sunday penalty rates. However, even when you look at the restaurant and cafe industry’s own survey, only 10 percent of businesses surveyed closed on a Sunday. Of the 90 percent that remained open on a Sunday, more than half did so because they made a profit.”