From the President

Soaring Costs Will Have Severe Consequences

By David Basheer

The recent Fair Work Commission announcement of a 5.7% wage increase from July 1 - in addition to an increase in superannuation by 0.5% - will place a further burden on our operators still grappling with sharp rises in power costs, insurance, council rates, government fees and charges, food and interest rates.

The rise comes off the back of a 4.6% wage rise only nine months ago and was higher than the rise forecast in the recent Federal budget.

Businesses and consumers alike are suffering from the current cost of living pressures.

However, the inevitable impact this wage rise will have on inflation means hoteliers are hit with the double penalty of a spiraling CPI further increasing future alcohol excise increases.

AHA|SA members are in the firing line of so many cost increases. We are a labour-intensive industry, so any wage rise will hurt our members the most.

People are quick to point out that we are a lower paying industry. What those critics choose to ignore is that well over half of our employees enjoy penalty rates or are on a casual wage - or both.

We want to make ensure our staff are well paid. And for many, we are their first job in life. An occupation where they learn their soft skills, before extending their work life. But right now, there appears to be minimal consideration of the huge cost impost being imposed on businesses like ours.

Post-COVID-19, we have had increased debt to pay, as well as deferred rent and other payments requiring attention. Some 65% of our operators are family based. As the cost of paying staff and doing business spirals, there is only so much that can be passed onto the consumer. Family members will find themselves working the extra day, or cutting back trading hours.

Make no mistake: you cannot continually drive up the cost of doing business without severe consequences.

The warning signs are obvious. Unchecked wage rises are simply not sustainable, they will do little to ease cost of living burdens and continue to create a huge burden in our operators.

ACTION STILL NEEDED TO ASSIST APPRENTICES

The recent State budget did not contain several key initiatives that the AHA|SA has been calling for, but we will keep them on the agenda.

As we continue to grapple with our labour and skill shortages, particularly in our kitchens, some very simple actions would deliver us welcome relief.

It’s no secret how hard it is to get apprentices to complete their four-year training scheme. Apprentices require milestone payments to incentivise these Gen Z chefs of tomorrow to stay the course.

The most sensitive period appears to be around the end of their second year.

It has been suggested by Federal Skills and Training Minister, Brendan O’Connor, that such payments should be prioritised towards the jobs of the future.

After our industry was sacrificed for the purpose of public health, and lost 60,000 of our staff nationally, we must be a priority right now. Milestone payments would mean host venues don’t feel like they have wasted two years of training when apprentices abandon their apprenticeship.

Tools of the trade and other measures to assist young apprentices were strangely abandoned by the Weatherill Government. There is no more appropriate time than now to restore those important cost of living concessions.

There is also an opportunity to explore other cost of living relief measures for young apprentices that relate to a range of Government fees and charges.

None of these programs would be a major impost on the State budget, but would be a welcome relief for employers and our apprentices.

UNIQUE HONOUR BESTOWED ON IAN HORNE

At Ian Horne’s farewell, the AHA|SA State Council bestowed Life Membership on our outgoing CEO, Ian Horne.

We know how revered and adored Ian is by our members.

AHA|SA Life Membership is awarded very sparingly.

Historically, it has only been awarded to publicans.

In recognition of Ian being the longest serving CEO in our historybut more importantly for all he has done for our members, well above and beyond expectation - the State Council departed from 152 years of custom and in awarding award Life Membership.

It will also mean we should still see plenty of Ian at our various events!