ATO warns businesses not to use loopholes to exploit $30bn Covid tax concessions | Tax


The Australian Tax Office has warned companies not to use loopholes to exploit more than $30bn of business tax concessions including instant expensing and loss carryback provisions.

In a speech on Thursday the ATO’s second commissioner for client engagement, Jeremy Hirschhorn, scolded companies for using jobkeeper wage subsidies to pay dividends and urged them not to use “artificial mechanisms” to exploit the measures contained in the 2020 budget.

Hirschhorn told a Chief Financial Officer Live event businesses should use concessions to invest rather than buy assets “not actually used in your business”, raising the alarm about practices like purchasing a company car in fact used as a personal vehicle.

Hirschhorn said that companies should “follow the tax law, but also follow the spirit of the law” to avoid bad “optics” such as stating Covid-19 “has not substantially impacted the operations of your business while at the same time collecting hundreds of millions of dollars in stimulus”.

Hirschhorn noted the 2020 budget contained two new stimulus measures allowing companies to immediately write off the full value of any assets they purchase and to claw back tax already paid against losses to June 2022.

“These measures should be embraced, but for the purpose for which they were introduced,” he said.

“Invest in new plant, upgrade your facilities, claim a tax offset and reinvest the money in your business and jobs!”

Hirschhorn warned companies to “think twice before entering into artificial mechanisms to take advantage of these measures”.

He cited examples such as “structured transactions where the plant and equipment is not actually used in your business, intellectual property migration with no change in real activity [and] asset swaps with related parties”.

The ATO has previously played down concerns that earlier versions of the instant asset write-off could be rorted, despite conceding in Senate estimates in 2015 that ping pong tables for a company’s employees would qualify.

Hirschhorn also warned CFOs not to “artificially shift profits (and losses) around your group to access the loss carry back”.

“Similarly, accessing the loss carry back to support executive bonuses, increased dividends or to repatriate cash to offshore related parties is likely to be viewed poorly by the community.”

Labor has raised the alarm about companies which claimed jobkeeper wage subsidies but later paid large dividends and executive bonuses. The head of the Business Council of Australia, Jennifer Westacott, has agreed companies claiming jobkeeper should not be paying bonuses.

Hirschhorn said the community expects that “large corporates, in particular but not limited to those who accessed [stimulus] schemes, will pay their share and improve their approach to tax”.

Although there was “nothing explicit in the rules” preventing payment of dividends and bonuses, Hirschhorn said there had been “quick backlash for those companies seen to be exploiting the spirit” of stimulus measures.

Hirschhorn said 92.5% of companies comply with their tax obligations while filing returns, rising to 96.3% after ATO compliance activity.

Despite the “globally high level of compliance” there is “lingering concern in the Australian community that large companies are still getting away with tax avoidance”, he said. “Much of this community concern is currently focused on large, mainly tech multinationals.”

Hirschhorn concluded by arguing businesses have “been entrusted by the government with leading the economic recovery with a range of stimulus measures”.

“With this comes increased expectations around corporate behaviour including tax. There is an opportunity to rise to these expectations and increase the community’s trust in large organisations.”



Source link

Big Businesses That Started as Side Hustles



9 min read

Opinions expressed by Entrepreneur contributors are their own.


While people have engaged in some form of “” for centuries, the practice has gained much more prominence over the last two decades. Since the advent of the Internet, millions of 9-to-5 workers have put their extra time and resources toward making money through side hustles. According to a Bankrate survey, nearly half of full-time workers take part in some form of “” outside of their traditional job.

These activities can range from starting a fashion blog to working as a freelance delivery driver — and everything in between. When my co-founder Sabine and I pivoted Dormzi from being a service-based network to a marketplace powered by young people, our vision was to help students lean into their side hustles. One of the challenges we’ve been seeing since doing so is that many aspiring entrepreneurs believe that they would have to completely drop their 9-to-5 job or schooling to turn their side hustles into thriving businesses. Fortunately, this is frequently not the case. To show how to turn your side hustle into a full-time , let’s look at a few real-world success stories:

Big businesses that started as side hustles

It’s a common misconception that your side hustle cannot become a successful business unless you dedicate 100% of your time and money to it. While it’s true that you cannot just expect a side hustle to become something more without any effort on your part, you can turn a side hustle into a full-time business without quitting your day job. How exactly can you do this? By regularly funding your side hustle with a portion of your 9-to-5 paycheck. 

It sounds too easy to be true, right? The fact is that many side hustles remain side hustles because people don’t put additional funds into them. For example, if you provide writing services, you could pay to develop a website that markets your services and makes you look more professional. Without a website, you’ll likely struggle to gain new clients and turn your side hustle into a long-term business venture.

Related: 50 Ideas for a Lucrative Side Hustle

So, to refute the naysayers, let’s take a look at some entrepreneurs who invested in their side hustles and now run extremely profitable businesses:

Aytekin Tank, Founder of JotForm

Before founding JotForm in 2006, Aytekin Tank worked as a senior web developer for a large Internet media company in New York City. During his five-year tenure, Aytekin Tank was frequently tasked with creating tools with which editors could create unique forms, like surveys. However, Aytekin Tank often found the existing tools on the market wholly insufficient.

Thus, JotForm was born. While Aytekin Tank toiled away at his day job, he spent his free time developing what would become one of the most popular online form builder tools in the world. His work as a senior web developer provided enough additional funds to turn his ideas into a reality. Over time, Aytekin Tank put away a small fraction of his paycheck until he was ready to launch JotForm. Then, he had the funds to hire a team, grow his start-up into a full-time business, and become one of the dominant forces in his niche. Today, JotForm has over 2 million subscribers and counting!

Andrew Mason, Founder of Groupon

While Andrew Mason working toward a Public Policy Degree at the University of Chicago, he started developing The Point, a platform that introduced the “tipping point” concept of donating funds towards a particular cause. With The Point, users could collectively fundraise in support of a common goal. However, if the goal did not reach a certain number of supporters or a minimum monetary amount, no one would be charged and the goal would be abandoned. This “tipping point” concept would later form the basis of Andrew Mason’s subsequent endeavor, Groupon,  with partners and .

Related: 18 Side Hustles That Can Help You Turn a Profit in 2020

Andrew Mason and his partners put a great deal of time and effort into The Point, which proved to be a failed idea, due in part to its lack of focus. However, they found that one aspect of The Point was particularly popular: collective buying power with group deals. Thus, in 2008, Groupon was born.

Andrew Mason worked as a server and a series of other odd jobs to pay his way through college and put aside funds to create The Point. Additionally, he was able to launch The Point with funds from his future Groupon partners. Even once The Point turned out to be a bust, Brad Keywell and Eric Lefkofsky stuck by Andrew’s side. The trio turned their initial failure into a massive success, creating a company that is now valued at more than $2.4 billion!

Eren Bali, founder of Udemy

In the mid-2000s, Eren Bali worked as a freelance web developer based in Turkey. While working for various clients, including the now-defunct Speeddate.com, Bali was putting his extra time and funds toward his own passion project. In 2007, he developed software for a live virtual classroom. He saw a lot of potential in his new creation, so he saved up the funds to move his base of operations to Silicon Valley.

Once in California, Eren Bali met up with Oktay Caglar and Gagan Biyani to found Udemy, an open online course provider. The site launched in 2010 with minimal funding. In fact, Eren Bali and his partners tried and failed 30 times to gain the interest of investors. However, the early success of the platform allowed them to raise $1 million in just a few months. Later, Groupon investors Eric Lefkofsky and Brad Keywell would help raise more capital for the burgeoning company. By early 2020, Udemy was valued at approximately $2 billion

How to Turn Your Side Hustle into a Full-Time Business

It’s easy to look at success stories and feel that these side-hustlers-turned-business-owners just got lucky. While there is a certain amount of luck involved in every entrepreneurial endeavor, there are actionable steps you can take to turn your side hustle into a successful full-time business. Based on the examples above, you can reverse engineer their experiences to find a process that works for you. So, let’s take notes from successful entrepreneurs like Aytekin Tank, Andrew Mason, and Eren Bali!

Related: Get Access to Kim Perell’s Side Hustle Accelerator for Just $30 for a Limited Time

Find and perfect your idea

In all three examples above, the founders of successful side-hustle businesses had ideas that they put into action. Often times, these ideas combined their existing skills or passions with a gap in the market. For example, let’s say that you are an excellent communicator and have expert knowledge in a particular niche. You could begin consulting for businesses in that niche. From there, you could set aside funds from your job to market and grow your side-hustle consultation services into a full-time business! This brings us to the second important step…

Develop a funding strategy

Most people begin side hustles to make money. However, to turn a side hustle into a business, you’ll need some starting capital. As a result, you’ll likely need to dedicate a small portion of your paycheck toward building your side hustle. This may sound counter-intuitive, but it’s actually a sound business strategy.

Think about it; if you quit your job just to focus on your side hustle, you greatly reduce your income and risk putting all of your eggs in one unpredictable basket. Alternatively, if you regularly set aside funds from your job (or your side hustle) to build your business, you’re essentially investing in your future without taking on any additional risk. Over time, this nest egg could be enough to get your business up-and-running. If you still need more capital, you could always look for investors or take out a loan to get things moving!

Launch your business

It may seem like an unimportant distinction, but a side hustle becomes a business once you identify it as such. Side hustles are essentially part-time, temporary work to make extra cash; businesses are long-term investments with the potential to grow and create much larger returns. So, once you officially launch your business as an LLC or similar entity, you’ve taken an important step in your transition from side hustler to business owner!

As illustrated in the stories above, side hustles are generally low-risk. You spend a little bit of extra time and money to (hopefully) make more money or develop a unique idea. However, launching a business entails much more risk. When Aytekin Tank formed JotForm, he struggled to pay and manage his ever-growing staff. Andrew Manson’s first business launch, The Point, turned out to be a momentous failure, though it led him to develop a much better and more profitable website. Finally, Eren Bali and his business partners failed dozens of times to secure funding before finally getting the capital they needed to grow their business. In all three examples, these entrepreneurs launched their side-hustle businesses in spite of the inherent risks.

Time to get started

Turning a side hustle into a doesn’t mean you need to quit your day job. In fact, a day job has allowed hundreds of entrepreneurs to routinely fund their side hustles, eventually transforming them into full-time businesses. Up-and-coming entrepreneurs sometimes argue that leaving their much-hated nine-to-five jobs to focus on a full-time business will increase their chances of success. While there is validity to the point that you can’t just “set it and forget it,” you don’t need to completely upend your financial life or career to build your business. Instead, routinely fund and dedicate extra time to your side hustle until your ready to launch your business venture.



Source link

Victoria’s cinemas stay shut while other businesses come out of coronavirus lockdown restrictions


Melburnians are returning to cafes, restaurants and even gyms but no-one is going to the movies.

Cinemas remain closed and they have been given no word on when they will reopen under the Victorian Government’s roadmap out of lockdown.

Cinema Nova in Carlton has been closed since July 9. But when he first closed the business, CEO Kristian Connelly thought he was only closing for six weeks.

“One would hope that we’re only going to be waiting for a few more weeks before we do see some sort of concrete announcement,” he said.

He believes cinemas are ready to open and safe, but he says his biggest concern is not knowing when his business can reopen.

“Having uncertainty about when it is that you can actually trade is one of the most crippling aspects,” he said.

“Having to remain upbeat for my staff in the face of this uncertainty just chews your guts up.”

Premier promises Government to reopen cinemas ‘as soon as we can’

Victorian Premier Daniel Andrews today said he had no date for cinemas reopening.

“With no disrespect to their product or the experience they offer, no time at the movies is worth putting at risk everything we have built,” he said.

“There will be a time to do that, it just isn’t not now.”

“We’ll get it open as soon as we can.”

Mr Andrews said it was an ongoing conversation with the industry.

Loading…

Mr Connelly said he was glad the Premier wanted to have a dialogue with the industry, but he had already been trying to talk to various Victorian government departments, including the Department of Health and Human Services, without receiving an answer.

“We have actually been given no reason why cinemas can’t operate in Melbourne,” he said.

“And this is really strange considering that regional cinemas are also included in these closures and obviously regional Victoria is far more progressed in arresting the spread of COVID than Melbourne, yet to date they still haven’t been able to open.”

The Premier did say that if cinemas felt there had been a lack of communication from the Government, then he would follow it up and make sure they were getting the information they needed.

Mr Andrews added cinemas would reopen in some capacity by the time Melbourne reached COVID-normal.

Opening a film in cinemas during the pandemic

Australian director Robert Connolly has a new film starring Eric Bana that is coming out soon.

Mr Connolly said it would be incredible to be able to share the film, which was set in Victoria, with his fellow Victorians after the year the state had been through.

“It’s been a tough year for Victorians who’ve dug really deep to pull through, and I think they should be rightfully proud of what’s been achieved,” he said.

“As a filmmaker, to be able to invite audiences to come in and experience this local Australian film that I’ve made with my good friend Eric Bana, who also lives here in Melbourne … it’ll be wonderful.”

The Dry, which is based on a book by Jane Harper, will be released on January 1.

While Mr Connolly was optimistic the Victorian Government would open cinemas before then, he said he hoped for the sake of cinema operators they could get answers soon.

With major Hollywood blockbusters delayed, Mr Connelly believes the next few months could be a great time for Australian film and he is keen to show local features as soon as possible.

Kristian Connelly said if gyms and other indoor activities could resume with the right precautions, cinemas should soon be able to do the same.(Supplied)

“Australian cinemas are a great way to make sure that our stories actually stand out; that they’re actually seen by people and people are aware of them,” he said.

“Unfortunately, when you just pour that out into the great ocean of the internet, the opportunity for people to find them and to see them is vastly reduced.”

He acknowledged that after prolonged the lockdowns, there was a strong possibility some Victorian cinemas could be lost forever.

“That said, I know that our industry is incredibly resilient,” he said.

“This is an industry which inspires a great deal of passion.”



Source link

Whys and wherefores of supply chain finance for smaller businesses


The past year has seen an increase in demand for supply chain financing products, particularly with COVID-19 affecting the survival of many Australian businesses. While banks offer products such as traditional trade finance and overdrafts, less than 50 per cent of financiers provide alternative forms of financing, such as factoring, forfeiting and receivables discounting. Subsequently, the needs of SMEs are often overlooked and are not adequately met by traditional financiers, with more specific and flexible working capital solutions required in the market.

Supply chain financing products need to be streamlined and automated, with an emphasis on fit-for-purpose. Here are the top five reasons why small businesses need to use supply chain finance.

  1. Provide cashflow
    Strong cashflow is an important factor in ensuring long-term business viability and success. Supply chain financing is an alternative finance method that help businesses extend their payment terms. Buy Now Pay Later B2B solutions such as UnLock can extend supplier terms for 30, 60 or 90 days. As a result, business cashflow is freed up and the improved working capital can be redirected towards staff wages, equipment or stock.
  2. Establish strategic vendor relationships
    Strategic vendor relationships can be established through supply chain finance. Vendors are paid on time, removing stress that business owners may have with cashflow. The objectives of the partnership should be structured so that there are equal opportunities for profitability and create a win-win situation for both parties involved.
  3. Negotiate early settlement discounts
    One of the main benefits of using supply chain finance is that businesses can negotiate early settlement discounts with suppliers. This can be done by having access to fast payment and a strong relationship with vendors. The settlement discounts flow directly into profits while still paying at invoice maturity.
  4. An extension to Accounts Payable process
    Supply chain lending is not a loan, but an extension of your Accounts Payable process. It is included in the off-balance sheet, meaning there will be general improvements in the balance sheet. The off-balance sheet nature of supply chain finance enables to add financing providers despite potential restrictions from debt covenants. It also works alongside major lender facilities such as Line of Credit or Overdrafts.
  5. Not secured by property collateral
    The use of supply chain financing products lowers the personal risk associated with directors. Another benefit is there is no personal credit check, but rather it is commercially based on director and commercial business scores.

Leo Tyndall, Founder and CEO, Marketlend





Source link

The Budget opens a new lifeline for small businesses


This year has been one of the most challenging in living history for small businesses, and for many, it continues to be a struggle as they battle a recession and work hard to preserve jobs and livelihoods.

That’s why many business owners were glued to the Treasurer’s budget speech, seeking the confidence they need to keep going and have renewed optimism for the future.

We wanted to see policy changes to support our small business community, and I feel the government delivered with tax incentives, wage subsidies and mental health support. It’s important recognition of the role small businesses play in our economy and how many of them have been doing it tough as a result of bushfires and the pandemic.

Two of the most critical measures were the loss carryback provision and the temporary full expensing, both particularly critical given their direct impact on cashflow.

Intuit QuickBooks research by YouGov revealed 40 per cent of small businesses negatively impacted by COVID-19 saw revenue drop by half as lockdown restrictions hit. Half cited adequate cashflow as a major concern going forward.

These two provisions may be the difference between staying in business, or not.

The first allows businesses to claim back taxes paid on last year’s profits, in recognition of the fact that many previously profitable businesses are now struggling through no fault of their own. By clawing back some taxes paid, businesses can bring some more balance to the books until things pick up again. This measure is valued at almost $5 billion over four years.

The second means businesses with turnover up to $5 billion – that’s 99 per cent of businesses in Australia – can write off the full value of any eligible asset they purchase for their business from 6 October 2020 until 30 June 2022.

It is expected this $26.7 billion measure (over four years) will lead to a surge in business investment and, as the Treasurer put it, “boost the order books of the nation (as) small businesses will buy, sell, deliver, install and service these purchases.”

While these are potential lifelines for many small businesses, we highly recommend any small business wondering whether it is in their interests to take advantage of these initiatives to reach out to a financial advisor who can guide them through the pros, cons and processes involved.

The government also confirmed the introduction of its Digital Business Plan. An initiative the PM described as all about “supporting Australia’s economic recovery by removing outdated regulatory barriers, boosting the capability of small businesses, and backs the uptake of technology across the country.”

In reality, a very large percentage of the funding announced will go towards expanding and streamlining the Australian Business Register. By merging it with some 31 other registers used by other government agencies, the government hopes to make engagement between itself and industry more efficient.

We hope that more of these funds can flow towards supporting the digitisation of small businesses, given the multiplier effect it can have on efficiency and performance when they need it most.

By combining access to new sources of cashflow with the support of a financial advisor and the efficiency-driving benefits of increased digitisation, small businesses will come out stronger on the other side of this historic disruption.

Although some commentators may say the budget didn’t go far enough, the collection of policy changes that will directly impact our small business community, are very welcome. It will certainly help lift small businesses out of the current crisis and provide a much-needed boost to economic confidence.

As small business ombudsman Kate Carnell declared, this year’s budget was “one for the history books”.

Natira Drayton, Country Manager and Vice President, Intuit QuickBooks Australia





Source link

Coronavirus Australia live news: Daniel Andrews to outline Victoria’s roadmap out of lockdown for households, businesses


More details of the roadmap out of lockdown for households and businesses are expected to be outlined today by Victorian Premier Daniel Andrews.

Follow live.

Live updates

By Jon Healy

From the streets of Melbourne

(ABC News: John Graham)

                

With the state set to come out of lockdown at midnight, out reporters have been asking people in Melbourne how they’re feeling.

              

Andrews ‘cleaned up his mess’

“It’s great news, I reckon. Even though initially I reckon Daniel Andrews did mess up, I think he’s cleaned up his mess.”

            

‘Zero day’ giving peace of mind before reopening

“Retail reopening means that we get to have customers in the store again. I think that everyone in Melbourne has been really looking forward to that. I also think that it is good we waited until this time — having a zero day today means that I feel a lot more positive about it and definitely excited to have people back in and opening up.”

             

Getting back to normality

“I think that I’m going to make the most of it. I’m going to go out and do all of the great things, and see my friends, my partner’s family. He hasn’t seen them for a very long time. I might even go to a restaurant and do what I need to do, and get a coffee! And just, I think it’s the prime example of just a bit of normalcy!”

By Jon Healy

Good morning to everyone, but especially those in Victoria

The state has been described as breathing “a collective sigh of relief” as it prepared for its first day out of hard lockdown.

             

We’ll have details of exactly how that will work throughout the day, particularly when Premier Daniel Andrews fronts the media again today, as well as stories from across the state.

          

Stick with us.



Source link

Small businesses key to shaping our communities


A new study reveals the affection of consumers for the small-business sector and its contribution to Australia’s way of life. The Next Chapter for Small Business report, commissioned study conducted by Forrester Consulting on behalf of small-business platform Xero, found 87 per cent of Australian consumers say that small businesses played an active role in shaping the culture of their local communities. That figure is higher than the global average of 81 per cent.

The study surveyed more than 1000 small-business owners and 1000 small-business customers evenly divided across Australia, New Zealand, Singapore, the UK, the US and Canada, researching how small businesses in key markets around the world have fared in the wake of COVID-19.

Globally, 69 per cent of consumers say they feel proud of the businesses in their communities and would feel a personal loss if those businesses were to close. Moreover, 39 per cent of consumers revealed that they purchase from small businesses to contribute to their community and support the local economy and local jobs. It also found that 85 per cent of Australian consumers agreed that small businesses were essential to the global economy, also higher than the 75 per cent global average.

“Small businesses have long been the beating heart of communities in Australia. This has never been more apparent than in recent times,” Trent Innes, Managing Director at Xero Australia and Asia, said.

“The resilience of the small-business sector has shone through this year, and it has been matched by a willingness and determination of communities to get behind them,” Innes added. “As we chart a path to economic recovery, the resurgence of the small business sector will depend upon the same commitment from communities to champion their success.”

The study also noted that Australian small businesses acknowledge how closely they are tied to the communities around them, with 70 per cent agreeing that small businesses play an active role in shaping the culture of their local community, with the global average at 69 per cent.

The pandemic has also shifted consumers’ expectations of small businesses, with increasing importance placed on empathy. The study noted that 93 per cent of consumers would trust a business, buy more, and recommend it to friends and family if it demonstrated empathy toward them, other customers and the community. This could potentially include implementing special rules to protect customers’ health during COVID-19, staying open longer, and offering delivery options.

“It is a critical time for small businesses around the world to focus on a few areas to improve their ability to survive,” Rachael Powell, Chief Customer Officer at Xero, said. “This research reveals the unique role they play in our communities as well as the variety of ways in which they can build resilience. How these small businesses expand their capabilities, communicate with customers, adopt new technologies and get support will define their success while we continue to navigate with this pandemic.”





Source link

How e-commerce has buffered small businesses from COVID-19


E-commerce has made a large difference in COVID-19’s impact on
Australian businesses, according to Deloitte Access Economics.

The research, produced in partnership with Australia Post, found that
non-store revenue from additional online activity has increased between
$105,000 and $708,000 for the average small business.

And, Australian businesses that invested in e-commerce have seen more
positive impact than those that didn’t.

“Australians are embracing home delivery in record numbers and this
analysis shows that over the next 12 months home delivery is expected to remain
25 per cent higher than pre-COVID levels,” Christine Holgate, MD and CEO at
Australia Post, said.

“That is a significant challenge for us as the engine room of Australian
e-commerce, but one we are preparing for.”

By using e-commerce, 73 per cent of businesses are able to retain
employees while 61 per cent of businesses remain in operation. From March to
August, non-store revenue of small businesses and businesses with up to 19
employees increased by 17 per cent and 23 per cent respectively.

“By focusing on the opportunities of e-commerce, businesses say they
have been able to protect not only their bottom line, but the livelihoods of
millions of Australians who rely on our business sector for employment,”
Minister for Communications, Cyber Safety and the Arts, Paul Fletcher, said.

The findings come ahead of the upcoming Christmas peak season, which is
expected to generate $4 billion in spending – 25 per cent more than last year.

“COVID-19 has changed the way Australians shop with an estimated 45 per
cent of purchases set to be completed online in the future,” John O’Mahony,
Deloitte Access Economics partner, said.

“Businesses looking to set themselves up for long-term success should
look to increase digitisation, improve their supply chain resilience, and
redesign their business strategy.”

This story first appeared on our sister publication Internet Retailing





Source link

End the Zoom Boom: Marshall calls on businesses to return to CBD


The State Government and business leaders are urging South Australian workplaces not to cancel major functions and Christmas parties, and to make the shift from remote working back to the CBD in a bid to bolster the broader economy.

Premier Steven Marshall was the keynote guest at a Property Council function at the Adelaide Convention centre yesterday, with the 450-person gathering spruiked as the biggest of its kind in SA since the onset of the COVID-19 pandemic.

Marshall told the audience while the vast majority of public servants were now back in the office, he wanted to see more businesses abandoning Zoom meetings in favour of returning to city offices.

“It’s still way too low in SA,” he said.

“But a lot of that is driven by the directives that national and international companies are giving to all of their employees, not the directions of individual businesses based in SA – and certainly not the direction of the State Government.”

Marshall said it was “incumbent on people in SA” who worked in the local arm of national or international firms “to be telling that story up the line in their organisations about how safe it is here in SA, and how productivity will improve if we get people back into their offices in the CBD”.

“It’s really important that the business community starts to model the types of behaviours that we want,” he said.

“Having nearly 500 people in the room [at the luncheon] is actually very positive, because it’s legal to do – it has been legal for quite some time,” he said.

“Each one of you should be saying to your organisations, ‘instead of continuing with Zoom meetings, instead of cancelling the Christmas party or awards night for the organisation and leaving that to 2021, you will have an economic impact on the state and employment if you can start bringing those events forward’.”

SA COVID-19 restrictions still impose a cap of 150 people for weddings and funerals, with gatherings at private residences limited to 50.

In a public outdoor space, gatherings are limited to 1000, subject to the ‘one person per two square metre’ rule.

Events such as yesterday’s are subject to individual COVID management plans, but the Government is encouraging industry to stimulate the economy through functions held within current guidelines.

Marshall said that businesses in the CBD had been “disproportionately hit” by the pandemic’s economic fallout, noting the Government had already targeted stimulus and support to this area – and declaring that will be expanded in next month’s state budget.

“It works in a virtuous cycle – the more people that are employed, the better returns there are going to be for the property sector,” he said.

“I honestly think COVID has given us an opportunity to sell our state in a way that we haven’t before… a lot of the global companies are saying ‘why do we have our head office in a major city, where we’ve got people in a big tower?’ I don’t think employees want to be in that big tower anymore [and] it can often be very expensive in some of those major cities around the world…

“So the off-shoring many of our global companies have done, I think those companies will be looking to bring those people back to Australia [and] cities like Adelaide will be very, very compelling going forward.”

But Deb Coakley, Sydney-based Executive General Manager of Funds Management at real estate investment firm Dexus, told a panel discussion at the event the “investment thesis for Adelaide” had to move beyond “that low-cost thematic flowing through the discussion in the past”.

“Now’s really the time to change that – there are some advantages here in terms of the diversity of skills and specialisations that Adelaide has that we really need to highlight,” she said.

She noted there was significant Government planning in areas such as health, ports, aviation and aerospace industries.

“We spend a lot of time discussing with investors the merits of Adelaide and frankly, we’ve knocked the whole low-cost component right to the bottom of that list because, frankly, it’s got a lot more to offer,” she said.

“We’ve actually got to get our promotion and rhetoric much more focussed on, where’s the value outside of purely just occupational cost?”

Marshall interviewed by the Property Council’s Daniel Gannon at the event. Photo: Metric

Property Council data suggests Adelaide CBD office building occupancy has grown each month since July to sit at 67 per cent in September – higher than Sydney, Canberra, Brisbane and Perth as well as lockdown-hit Melbourne.

National Property Council president Stephen Conry, head of leading commercial property services firm JLL, told a panel discussion at the event he estimates the rate in Adelaide would now be higher than 70 per cent.

“It’s great to see Adelaide leading the way – of course businesses should be back in the office,” he said.

“It’s ridiculous that so many corporates and government departments aren’t back in the office – it’s perfectly safe, [and] it is far more productive.”

He said “the problem is too many CEOs and government leaders are surveying their staff” about whether they wanted to continue working from home.

“Why would you? Of course staff want to stay at home and work [but] they have to get back to the office,” he said.

“It’s far more productive, and if you’re back in the office in the CBD you’ll have more thriving CBDs – you need thriving CBDs for a growing economy.”

Property Council SA executive director Daniel Gannon said while more than two thirds of workers had already returned to CBD offices, “the viability of our city and its businesses, cafes and restaurants is reliant upon all workers returning to their office workplace”.

“To a large extent, the private sector is dragging its feet rather than government – a number of businesses that are based abroad or interstate are still maintaining ‘work from home’ policies without any consideration of our positive local circumstances, which is hurting small business owners and deactivating the CBD,” he said.

“If business leaders don’t implore their people to return to the office, Adelaide’s CBD and South Australia’s economy will face a protracted period of pain.”

Help our journalists uncover the facts

In times like these InDaily provides valuable, local independent journalism in South Australia. As a news organisation it offers an alternative to The Advertiser, a different voice and a closer look at what is happening in our city and state for free. Any contribution to help fund our work is appreciated. Please click below to donate to InDaily.

Donate here

Powered by
PressPatron





Source link