Businesses to “hibernate” through coronavirus crisis, Scott Morrison says
Prime Minister Scott Morrison wants to put small businesses into “hibernation” to allow them to ride out the coronavirus pandemic… but provides no details.
Prime Minister Scott Morrison wants to put small businesses struggling with the economic fallout of the COVID-19 pandemic to sleep in an unprecedented “hibernation” policy.
In an extraordinary step, Morrison revealed the plans at a press conference on Friday, saying it was the federal government’s objective to ensure businesses could survive the crisis by suspending operations, without providing further details about how this would work.
“There are businesses which will have to close their doors. They will have to keep them closed either because we have made it necessary for them to do so, or simply there is just not the business to keep their doors open,” Morrison said.
“We want those businesses to start again. And we do not want, over the course of the next six months or as long as it takes, for those businesses to be so saddled by debt, so saddled by rental payments, so saddled by other liabilities, that they will not be able to start again on the other side.
“We want these businesses to effectively go into a hibernation, which means on the other side, the employees come back, the opportunities come back, the economy comes back.”
Asked to provide further detail about the forthcoming policy, Morrison reiterated there will be further announcements about “the details”, saying his intention today was to “set out what the objective was”.
“There will be landlords who will suffer. There will be. The banks will be having to make arrangements with them,” Morrison said, speaking on who will pay for the hibernations.
“Whether councils are involved in providing waivers on rates, things of that nature, that will be something states work through.
“Whether land tax will be relieved for those who have tenants in a distressed situation. All of these are what we are working through. It isn’t simple.
“The intent is as far as possible to achieve what you have said [business hibernation],” Morrison continued.
Tens of thousands of businesses across the country have already been closing their doors over the last week after the federal government unveiled two tranches of trading restrictions targeted at the hospitality and personal services sectors.
Amid ongoing speculation about whether widespread commercial rent relief will be extended to small businesses, Morrison said more details would be included in an impending third tranche of economic stimulus, to be announced at a later date.
In the meantime, Morrison said landlords, utility companies and small businesses should “come together” and sort things out.
“If a tenant, a shop in a local high street somewhere in the country cannot keep their shop open, and they have to put the lock on the door, they can’t pay the rent, if the landlord wanted to enforce that on them and kick them out and rip their fit-out out and do all that sort of thing, who do they think will go into the shop and pay the rent?”
“We want landlords to talk to the tenants, we want employees to talk to their employers, we want banks to talk to their customers and vice-versa, and we want them to sort out arrangements that help them or get through,” Morrison said.
Morrison was expected to announce measures to provide state-sponsored rent relief to small businesses on Friday, but no policy changes were unveiled through the course of the press conference.
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