2 June 2020

"He can do my books with me": Business slams Barr for stimulus missing the mark

| Dominic Giannini
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ACT Chief Minister Andrew Barr during press conference.

ACT Chief Minister Andrew Barr says the government is not in a position to become a bank for small businesses. Photo: Region Media.

The president of the Phillip Business Community called on the ACT Government to provide more fiscal stimulus through grants to help struggling industries that have fallen through the cracks during COVID-19 restrictions.

Tom Adam said the ACT should follow in the footsteps of Queensland, NSW and Victoria by providing cash grants of up to $10,000 for struggling businesses. He emphasised the ACT Government cannot afford not to help.

“We are local businesses in local communities with local customers who are all ACT residents,” said Mr Adam. “It is not just a Federal Government issue, it is not just a Territory government issue – they need to work together.”

Mr Adam – who also runs Canberra Martial Arts – took aim at ACT Chief Minister Andrew Barr after he announced the Territory’s most recent stimulus measures for the hotel and hospitality industries, and said small businesses “do not want discounts on taxes and rates [they] do not pay”.

A further $6 million in rate rebates and free permits was set aside by the ACT Government on Friday, 29 May. Mr Barr defended the new measures and said the ACT is not seeking to invent a new way to deliver fiscal support. He stated that existing fiscal channels are the most effective way to deliver stimulus.

“We will look for ways to assist those industries, but if they do not pay any tax or any fees and charges then our capacity to rebate any of that is obviously limited because they do not have a financial relationship with the ACT Government by way of paying any taxes or charges,” he said.

“Clearly the broader initiatives we announced several months ago would flow through to those in these industries by way of their relationship with their landlord, or if they happen to own their own commercial property.

“The broad answer is if you do not pay any fees, rates or charges to the ACT Government, it is hard for us to rebate anything to you.”

Businesses which have a payroll under $2 million are not subject to the ACT’s payroll tax, and businesses which do not need special licences are getting very little help from the ACT Government, said Mr Adam.

The Federal Government’s JobKeeper payment does not cover four of Mr Adam’s casual employees at his martial arts business, and even with decreased rent, his business has still been losing more than $1000 a week during the past 10 weeks.

Tom Adam (left) and Robert Issell (right) from the Phillip Business Community.

Phillip Business Community president Tom Adam (left) with retiring president Robert Issell when handing over the reins of the organisation in December 2019. Photo: Supplied.

“My JobKeeper payment is going back into the business,” said Mr Adam. “I cannot afford to pay myself a wage. A $10,000 grant would give my business the confidence to get through the next 10 weeks.”

Mr Barr said the JobKeeper payment is primarily an issue for the Federal Government, but he is lobbying through National Cabinet to extend JobKeeper’s September cutoff.

“With small business finance, the banks have been given hundreds of millions of dollars in guarantees to ensure lines of credit to small business so I cannot duplicate an ACT Government bank and just click my fingers and whip it up,” he said.

“The banks are the best places to seek very low interest, and in some instances, no-interest loans or lines of credit in the short term.

“[In terms of grants] that is what the Commonwealth Government does. They have the mechanisms to do that. It is their role and they have programs in place doing just that.”

But Mr Adam maintains the Barr Government is trying to maintain its budget bottom line.

“I have to take money out of my mortgage to inject into the business and use my own savings to pay my staff,” he said.

“No-interest and low-interest loans are rubbish. Banks do not refinance old debt; they only offer you new money that you have to pay back in a shorter time frame so you end up paying more.

“I would like to ask Mr Barr if he has ever run a small business, and if not, he can come do my books with me to see why I am nearly in tears each week.”

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It certainly seemed a bit unfair that Andrew Barr targeted COVID tax relief at Braddon and Civic businesses, whilst not providing a similar level of support for businesses not in his electorate.

Certainly a few of the shut small businesses in Phillip and across Tuggeranong over the last couple of years have highlighted the impact of commercial rates on their ability to operate a profitable business. Especially locations where a large land holding doesn’t correlate with the ability to generate much income.

Supermarket at Richardson, auto shop at Phillip and businesses at Wanniassa come immediately to mind.

If that’s really true, then it’s utterly disgraceful for Mr Barr to be providing special assistance to his certain areas when the rest of Canberra are suffering. A quick look at the confusing ACT covid support package shows you how limited the help is. If a landlord provides at least 50% rent relief to a commercial tennant, and his property is worth less than a certain amount and he fills out a form with relevant details, then the ACT guvmint will rebate him a certain percentage of the rent relief, but only up to amount of rates payable, with the rest is lost, and comes out of the landlords pocket. Even then, the landlord will have to wait until rates are issued to get any benefit from any of this. In the meantime, businesses get huge assistance from the federal government in terms of booster and jobkeeper payments. It seems Mr Barr is happy to allow highrises and mini-cities to be built all around Canberra, collect huge rates, but provide little assistance to businesses and landlords. Much of the budget is going to that white elephant down Northbourne Avenue.

I read back over the article and there is no mention of “targeted COVID tax relief at Braddon and Civic businesses, whilst not providing a similar level of support for businesses not in his electorate”. Care to share with us where this little gem of a fib came from bj-ACT?

phillipbusinesscommunity1:21 pm 02 Jun 20

I do keep referring to his position in my media contacts, never refer to him as Mister Barr – as it’s not about him personally, it’s always directed at the position of ACT Chief Minister (as the position is no a permanent role, but he will always have his name).
We’re not asking for loans, the comment that if small businesses aren’t paying local territory taxes there is no relief implies that ACT Small Businesses therefore do not contribute to the economy of the ACT??? I would say they contribute in many ways – need I list them.
As always, my comments are directed at the position and the policy, not the person.
Always happy for a cordial chat about this stuff, but to date my efforts have gone without reply.

Tom Adam

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