David Canny AHA

Victorian pubs face going over “debt cliff”

September 7, 2020
By Alana House

There are fears Victorian pubs, cafes and restaurants will collapse following Premier Dan Andrews revealing they must remain take-away only until at least the end of October.

Andrews outlined a phased “roadmap for re-opening” on Sunday, with the aim of reaching a “COVID normal” state by the end of the year.

Pubs, restaurants and cafes will only be allowed to offer take-away under steps one and two of the roadmap.

Step three, starting October 26 and contingent on the state recording fewer than five new cases each day, will see hospitality venues allowed to re-open for “predominantly outdoor seating service” and group bookings of up to 10 people.

The final step before “COVID normal” is planned for November 23 and will see indoor dining expanded to a maximum of 50 people and group bookings of 20.

The Australian Hotels Association said hotels and pubs faced “going over a cliff” under the extension to Melbourne’s stage 4 restrictions.

“We are on the verge of becoming a ‘welfare state’ if our members are any indication as to the impact that lockdown restrictions are having on us,” association president David Canny (pictured main) said.

“Each pub has a limit of just how much debt it can take before decisions are made to close the business for good.

“This is the cliff we are now facing. Local pubs are on the debt cliff and will never recover if they cannot reopen soon.

“We could lose the iconic corner pub because of the debt the Victorian Government restrictions have put on them.”

Victorian Chamber of Commerce and Industry chief executive Paul Guerra said: “We were hoping for a road to recovery. Today we have been delivered a road to nowhere,” he said.

“This does not deliver for the thousands of businesses that are trying to keep this state going and trying to keep their doors open.

“We can’t continue to let business and jobs be decimated on the way to controlling the spread of the virus.”

The Palace

Pubs such as The Palace (above), in South Melbourne, are hanging in there by selling growlers and takeaway food.

“It’s keeping the few of us here busy and stops us from going insane but we are trading at 8 to 10% of turnover,” co-owner Jess McGrath told ABC News.

Regional Victorian pubs suffering under intrastate travel ban

Regional Victoria, currently in Stage 3 restrictions, will move to the second step of reopening from September 13, but hospitality venues will still be restricted to takeaway and delivery. 

A transition to the third step of reopening will occur when regional areas maintain less than five new cases on average over the last 14 day period and zero cases of unknown source in total over the last 14 day period.

Under this stage, Victorian pubs in regional areas will be able to offer predominantly outdoor seating, subject to density requirements and group limits of 10. 

Intrastate travel won’t be allowed until the last step of the roadmap.

Anthony Cerantonio, Victorian state representative for the Small Business Association of Australia said: “Until such time as Melbourne opens and Melbourne residents are allowed to travel, the tourism industry in places like the Great Ocean Road is not going to go anywhere.

“We’re like farmers: if there’s no rain, you go broke. Well, if there’s sunshine but no tourists, we’ll go broke.

“The Christmas period is so vital because that’s where tourist businesses get 60% of their income for the period. If Melbourne is in lockdown and people aren’t allowed to travel that’s the nail in the coffin. This is the real problem at the moment.”

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