The NSW Government 2023-24 Budget relief measures are expected to create a flow-on effect for retailers, with household incomes cited as a silver lining by industry leaders.
Australian Retailers Association (ARA) CEO Paul Zahra said that any measure to put more money in the pockets of NSW families is likely to stimulate the retail economy.
“Cost-of-living is the biggest issue for all Australians and New South Wales is no exception, so it’s good to see the budget providing some relief, which will in turn stimulate the retail sector,” Zahra said.
“Initiatives such as preschool fee relief, toll caps and energy rebates for consumers will all play a role in freeing up the household budget - alleviating financial pressures and hopefully driving more discretionary spending.”
This includes a National Energy Bill Relief payment that was introduced in July 2023, where 1.6 million eligible families, pensioners, low-income households, veterans, carers and self-funded retirees can access a $500 electricity rebate that will automatically be applied to bills in 2023-24.
Under the same scheme, more than 300,000 eligible businesses using less than 100 MWh of electricity per year will receive a one-off $650 bill relief payment towards their electricity bill in 2023-24.
The Budget will also include toll relief for commuters and businesses with a $60 weekly toll cap and truck toll multiplier relief of 33% on the M5 East and M8, as well as $1.6 billion of preschool fee relief from an expanded affordable preschool program.
The preschool fee relief is intended to save parents and carers $500 a year by trialling preschool fee relief for 3-year-old children in long day care, $4,220 per year in fee relief for parents and carers of 3-to-5-year-olds in community and mobile preschools, and $2,110 in fee relief for children aged 4 years and older attending preschool in long day care centres.
Mosaic Brands CEO Scott Evans told Ragtrader that budgets may not increase consumer confidence "but they can most definitely harm it."
"On first glance more pay in essential workers pockets may be spent in stores, so that’s a possible plus for retailers. Otherwise it would seem fairly neutral for the sector.”
While Zahra acknowledged the 2023-24 Budget was focused on returning the state to a future surplus, he said he hoped for more support for small businesses.
Zahra said small businesses are under pressure from rising business costs and slowing revenues and are calling for relief.
“We would like to see some relief in terms of energy costs, payroll tax and workers compensation, or alignment across state borders to reduce complexity for business,” Zahra said.
The National Retail Association (NRA) also spoke of the need for government support desperately needed by businesses today.
"We appreciate the $650 one-off bill relief payments towards the 30,000 eligible businesses, but do not believe this goes far enough in terms of support," NRA CEO Greg Griffith said.
"We hoped the State Government would consider the increase in wages, that have taken money out of the pockets out of many small business owners, before making budgetary decisions.
"Retail crime is also on the rise and is costing our industry billions. The retail sector needs targeted funding from governments that help businesses keep their heads above water amid these economic disruptors.
"We also welcome the cost-of-living relief measures outlined in the budget but encourage regulators to keep small retailers in the forefront given they are the one of the key drivers of the NSW economy."
The NSW government also made announcements in relation to the transition to net-zero emissions and building a more resilient supply chain. These are two key focus areas for retail, according to the ARA.
“The ARA is committed to an efficient shift to the low-carbon economy of the future, and so we welcome the governments’ announcements to reduce the costs and risk of the transition away from coal-fired generation to renewable energy sources,” Zahra said.
“We also welcome announcements in relation to toll relief that will reduce costs for business, and investments in road infrastructure to keep the supply chain moving in greater Sydney and the regions, particularly after natural disasters.”