From the General Manager

IAN HORNE – AHA|SA GENERAL MANAGER

Watch the GM's Report here: https://youtu.be/OtAwsbyM3Ec

Independent Report Urges Consultation to Avoid ‘Scorched Earth’ Response to COVID-19

The SA Centre for Economic Studies based at the University of Adelaide has revealed the full extent of the damage done to the hotel industry and its 27,000 employees as the result of State Government’s three-day COVID-19 lockdown in November last year.

The AHA|SA commissioned the report to gain impartial facts and precise figures about the consequences of the lockdowns.

Critically, it makes four key recommendations, the first of which is that government consultation with the industry prior to any further lockdowns “would provide superior outcomes for all”.

“In future cases of COVID-19 or other pandemic outbreaks, consultation with the South Australian hotel industry can help meet the SA Government’s desired suppression outcomes while likely reducing the risks of adverse mental health, societal, employment, business and economic outcomes that have resulted from the November lockdown,” it states.

The report was prepared by Assoc. Professor Michael O’Neil, Executive Director of the SA Centre for Economic Studies (SACES) and economist Darryl Gobbett, Visiting Research Fellow at SACES.

It notes that the hotel industry was “heavily adversely impacted” during the three-day closure, including the following:

• 20,000 hotel staff were put out of work

• Food and beverage wastage of up to $10 million, much of which could have been avoided.

• Permanent workers were the hardest hit, with 80% stood down. 50% of casual workers also found themselves without any shifts.

• “Substantial impact” on suppliers to the industry.

The report is entitled Impacts of COVID-19 Lockdown: A Case Study of the South Australian Hotel Industry November 2020.

The truth is that 27,000 people have a stake in the management of COVID-19 cases and the threat of lockdowns and they don’t want a repeat of 2020. From the hotel worker who suddenly can’t pay their rent to the pub owner throwing fresh food into the bin, the economic and mental toll is almost overwhelming.

For example, the value of food and drink that had to be disposed of could have fed up to 256,000 South Australians during the entire three-day lockdown.

SACES has revealed that much of this waste could have been avoided if the industry had been consulted in advance.

The AHA|SA would welcome the opportunity to be an active part of the solution. We don’t have to have a replay of 2020’s scorched earth policies.

It’s time to work together for the collective benefit of the State and the AHA|SA wants to be part of the solution.

ONGOING DAMAGE

The SA Centre for Economic Studies report highlights the fact that economic and mental health damage continued after the initial three days, as “severe restrictions remained in place”.

“The resulting cancellations or disruptions to planned functions; limited dining and drinking capacity; and heightened uncertainty about what new restrictions could be quickly imposed without consultation with industry sharply reduced business activity, turnover, purchases and employment in the following weeks through to 31 December:

• employment is estimated to have, on average, been 12,500 lower per day through the period 26 November to 31 December than would have otherwise been the case if the new COVID-19 restrictions had not been in place;

• turnover is estimated to have been lower by some $100 million, or between a quarter and a third, in the five weeks to 31 December;

• spending on food and produce is estimated to have been lower by between $21 million and $30 million. 42.7 per cent of respondents to the survey reported a reduction of purchases of between $10,000 and $50,000;

• spending on services that would have otherwise been provided by subcontractors or tradespeople is estimated to be down by between $11 million and $15 million;

• total accommodation revenue lost for the 30 days following the lockdown is estimated at between $4.7 and $15.5 million.”

REPORT RECOMMENDATIONS

The report’s authors propose a four-point plan to achieve a more effective response to future restrictions:

1. “Prior to the announcement of any future lockdown or pandemic measures that are likely to affect the hotel and hospitality industries consultation with the AHA (SA) in a timely manner would provide superior outcomes for all. “

2. “We consider a more nuanced approach to sector and geographical measures, coverage and timing is feasible to minimise the adverse impacts while ensuring that the

proposed health benefits are still met. For example, there would appear to have been no justification to close country pubs and venues on 19 November 2020 and ban weddings and funerals when there were no indications of country community infections and no country medi-hotels. Other States seem to be able to handle a more regional approach.”

3. “Timely, albeit limited but advanced warning is critical to minimise disruption and wastage that also allows food stocks to be sent elsewhere to the benefit of the community.”

4. “It would be helpful to host discussions with the AHA (SA) to investigate and agree what state-wide measures can be adopted that would prepare the sector to operate in the event of another outbreak while meeting the health objectives e.g. the deployment and monitoring of attendance utilising the QR app now and potential for hoteliers in future to restrict entry by unvaccinated clients and not have to employ unvaccinated staff.”

The study is intended as a contribution to policy considerations with respect to COVID-19, the lockdowns and health responses designed to stem the tide of the pandemic and what we have learnt to date.

The future occurrence of COVID-19 is impossible to predict, but we can use the facts and recommendations contained in this report to plan for future scenarios. Government and their agencies need to learn from the experience and do it better because the Hotel, hospitality and tourism sector continues to carry a disproportionate cost for the failures of others.