RETAIL LEASES AMENDMENT BILL 2012 – Wednesday, 10 Oct 2012

Posted on 18. Oct, 2012 in Speeches

I rise to speak in the debate on the Retail Leases Amendment Bill 2012. The bill makes a very modest amendment to the Retail Leases Act 2003. I suppose it allows the Minister for Innovation, Services and Small Business to claim she has been busy introducing legislation into the Parliament. Whether it will be the saviour of the Victorian retail industry, as she attempted to say at the conclusion of her speech, is another matter. Currently section 25 of the Retail Leases Act requires the landlord, after all parties to a retail lease have signed it, to notify the small business commissioner in writing of the address of the retail premises, the landlord’s name and address, the tenant’s name and address and the date when the lease was signed. Clause 7 repeals section 25 of the principal act. It is a modest reduction in red tape, but it hardly justifies the claim made by the minister that it will make Victoria the best place to start, operate and build a business.

The problems confronting the retail industry are well known. Retail businesses selling household goods in traditional bricks and mortar shops are struggling, particularly with the explosion of online sales. Restaurants and takeaway food businesses are also a bit sluggish because of the discretionary nature of spending, but they are doing better because they do not face online competition. This economic situation has serious implications for not only the owners of the businesses but also the many thousands of Victorians employed by them. My electorate of Clayton is typical of this picture. Clayton Road has a number of restaurants and takeaway food businesses along it, and the area is busy. However, there is also a stand‑alone shopping complex at the corner of Westall Road and the Princes Highway with large retailers such as the new Ikea, Harvey Norman, JB Hi‑Fi and many other home furniture stores. They employ around 900 people. Gerry Harvey has been quite outspoken about the challenges facing traditional retailers. It is difficult to believe the bill will give Harvey Norman the boost the minister seems to claim.

What is much more critical to the retail industry is that the Baillieu government wake up from its slumber and use the levers of government, including projects, to stimulate demand. A recent economic analysis by the Bank of Melbourne demonstrates just how much demand has slowed in Victoria, especially in comparison to other states. It is this slowing of demand that will have a much greater impact on Victorian retail businesses, unfortunately in a negative way, than will the token elimination of one piece of red tape. The Bank of Melbourne report entitled Victorian Economic Outlook is dated Monday, 26 September 2011. On page 1 it states:

But Victoria is now experiencing slower growth. State final demand grew by 2.3 per cent in the year to the June quarter 2011. This pace of growth is the slowest in nearly two years and is well below the five‑year average of 3.0 per cent.

Most significantly for retail businesses facing slowing demand, on page 3 the report states:

State final demand for Victoria fell behind domestic final demand (for Australia) of 3.4 per cent and sits in fifth place behind WA (6.6 per cent), QLD (5.7 per cent), ACT (4.6 per cent) and SA (2.7 per cent).

Victorian retail businesses are doing it hard. As I said, there are serious implications in this for employees as well as for operators. Small business operators need all the support they can get from both the state and federal governments getting their economic settings right. Last week’s interest rate cut will be welcomed by retailers. The bill is not part of the same claim, and it is silly for the minister to claim it as such.

 

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