Late Night Economy

(Private Members' Statement, 6 August 2020, Legislative Assembly, NSW Parliament)

A diverse and vibrant late-night economy is a hallmark of a great global city and it is essential that we establish a roadmap to help the city's nightlife recover after the pandemic. Before COVID-19 hit, Sydney's late-night economy was crippled by six years of 1.30 a.m. lockouts and over a decade of a freeze on any new premises. While the provisions provided an important circuit-breaker to spiralling violence and unsustainable venue growth in inner-city hotspots, they impacted on the city's social and cultural fabric, and its reputation as an interesting place to visit at night.

The lifting of the lockouts on Oxford Street and in the central business district brought hope of a rebirth, but unfortunately COVID-19 has required new harsh and important restrictions on late-night premises to protect life. It is a significant blow to the industry, especially as we potentially face a second wave. The vast majority of hospitality venues are now barely keeping afloat, with many operators telling me they may not survive. The sector is based on bringing people together and providing opportunities to socialise, making it especially vulnerable to impacts of social distancing.

Before COVID-19 the hospitality industry employed almost a million people across Australia, but the pandemic has led to mass lay-offs in the sector. Data from the Australian Bureau of Statistics shows job cuts of 27.1 per cent over April. Over 6 per cent of additional workers left the industry between May and June. There are estimates that up to half of hospitality jobs could be gone by the end of September and predictions that COVID‑19 could result in 30 per cent to 50 per cent of hospitality businesses becoming insolvent. Around 40 per cent of employees in the industry are not eligible for JobKeeper because they are short term, casual or temporary visa holders. Letting bars sell takeaway food and drinks—which was introduced in response to my request—is providing much‑needed income but takeaway can replace only 5 per cent to 10 per cent of business. Venues are unlikely to be able to cater to their full capacity for a long time and will miss out on the boom periods of summer events and Christmas. The recession will have broader impacts as people have less money to spend on discretionary expenses. There are reports that when restrictions were eased after the lockdown, landlords began demanding rent increases that far exceeded any gain in returns. The growing community transmission across Sydney shows that the business situation remains unstable and any increase to rent will hit a business' future viability. We urgently need a plan to stop the industry from collapse.

If the sector has a clear guaranteed future, it will give operators confidence and encourage investment. The planned removal of the liquor freeze in the CBD and Kings Cross on 1 December is a good start in supporting new businesses in the city. Venues should be able to make an application without having to go separately to various agencies, such as Liquor & Gaming NSW, the council and police. We need to use this time to get the licence density in Kings Cross right and remove the 1.30 a.m. lockout that still exists. Sydney WorldPride 2023 will bring significant activation to the inner city at night. The guarantee of an influx of visitors to the area in 2023 is helping to boost confidence in the hospitality sector, particularly around Oxford Street, while planning is providing economic stimulus.

Investment in new cultural facilities such as social hubs could attract new patrons to late‑night trading spots and revitalise their economies. The Metro Minerva Theatre in Potts Point provides significant opportunity to create new theatre space and diversify Kings Cross at night. Planning could start now to deliver a facility when the pandemic is over. Financial help is needed to give businesses access to low or no interest recovery loans and payroll tax deferrals must continue for another six months. Federal measures are also needed to expand the coverage of JobKeeper and extend the moratorium on bankruptcy. Importantly, we need a plan for the long‑term survival of the sector. I understand a late‑night strategy has been in development for some time but it needs to be brought forward in response to COVID-19, with the focus on protection and recovery. I call on the Government to establish a pathway that ensures the city can have a late‑night economy that is safe and exciting during and after the pandemic.