The Victorian Commercial Leasing Code of Conduct will be extended beyond the September expiry date to the end of the calendar year, Treasurer Tim Pallas has said.
It’s a move that has been referred to as a life raft for thousands of Victorian small businesses, and according to Mr Pallas, it will provide certainty to those struggling as a result of the state’s latest round of lockdowns.
“Nobody should be worried about losing a roof over their head right now, particularly given the circumstances around social distancing,” Mr Pallas said.
“But also, the associated economic consequences of the pandemic event that the entire world is confronting.
“We need to provide certainty to people who lose their homes or their businesses, and we need to help tenants and landlords find some common ground.”
Within minutes of the Treasurer’s announcement, the Franchise Council of Australia welcomed the extension.
“This extension is a life raft for thousands of Victorian small businesses who are struggling to keep their head above water. With a major drop in turnover, small businesses still have to contend with fixed costs like rent. Extending the protections in the Victorian leasing code will help small businesses negotiate in good faith, and apply for a reduction in rent commensurate with their drop in turnover,” FCA CEO Mary Aldred said.
“In particular, it has been especially encouraging that small business minister Jaala Pulford has engaged with small businesses on a notoriously complicated set of issues and is acting to support small businesses.”
While the December extension is a welcome relief, the FCA said it will continue to urge the Victorian government to extend the provisions further, so that they aligned with the new JobKeeper date of March 2021.
The FCA has participated in the Victorian Commercial Tenancies Relief Panel, which has brought together landlords and small business representatives to work through the challenges presented by commercial leasing arrangements.
“For small businesses and franchisees, commercial leasing terms remain the number one issue for a majority of our members. Victoria is the only state to have initiated a forum to bring landlords and business tenants together to work through these issues with the support of Minister Pulford and Business Victoria,” Ms Aldred said.
“Banks and energy companies have been forthright in their message to business customers [experiencing] hardship to engage their support, and we need a similar level of proactivity from commercial landlords to support small businesses as well.”