Financial Review Virtual Summit – Retail: Through the Crisis


I am delighted to provide the Key Note Address to the Financial Review Virtual Summit – Retail: Through the Crisis.

I would like to thank every small and family retail business for everything you have done and everything you continue to do for Australia and Australians.

It is great to see retail recovering as COVID-19 restrictions are gradually removed.

Successfully re-opening all of the retail sector is imperative for our employment recovery.  

I am continually humbled and amazed by the incredible spirit, strength and adaptability of small business owners in retail, so many of whom have felt the devastating effects of COVID-19.

Aaron from Husk Bakery is a fantastic example of that adaptability.

In the early stages of COVID-19, his business declined rapidly.

Thinking quickly, he set up the Husk Bakery Van to deliver his baked goods to customers at home.

In the words of Aaron “I really had to think of the best ways to utilise the resources I already had to optimise my business. Having limited resources really does result in creative solutions which is why I chose to do home delivery.”

Of course, the Husk Bakery Van is just one example of a small business adapting, surviving and succeeding.

But for many sectors the recovery may be slow and turbulent, accompanied by disruption of demand and international markets.

Collectively, we will need to continue to be informed and agile in our response.

Small businesses are the lifeblood of our communities. The ingenuity and adaptability they have shown in the face of significant challenges is inspiring.

I don’t underestimate the impact COVID-19 has had on people’s lives and livelihoods.

The retail sector is worth $325 billion and employs 1.3 million people, making it the second largest workforce in Australia.

Which is why it is so concerning that since the beginning of this crisis, 6.3 per cent of Australians who work in retail have lost their jobs.

Different sectors face different issues but the number one thing you all need – is a safe and sustainable reopening of the economy.

As markets return and economy wide measures subside, we must monitor conditions, encourage business leadership in resolving problems, and, remove impediments.

Where we have been

Australians have shown incredible resilience in the face of the twin health and economic crises. But it has not left us untouched.

Sadly, 103 Australians have lost their lives due to COVID-19.

Thankfully, our actions have limited the worst effects of the virus, avoiding the predictions of hundreds of thousands of Australians being infected and tens of thousands of deaths.

When compared with other developed nations with advanced health systems, Australia has performed remarkably well.

The United Kingdom’s death rate is more than 160 times Australia’s – the equivalent of over 16,000 deaths in Australia.

Just as our health response has been world class in managing and containing the outbreak of COVID-19 in Australia, we have also had success in supporting the economy.

This is the greatest economic challenge we have faced since the Great Depression.

The necessary and temporary restrictions meant that many businesses across the retail sector had to shut their shops and, workers lost their jobs.

It is estimated that over $100 billion of economic activity has been lost this year, and that it will take at least two years to regain what has been lost.

But unlike other countries who imposed strict lockdowns, Australia managed to keep large parts of our economy open.

In order to support the economy and households, the Government put in place a range of measures that are targeted and proportionate and injecting $260 billion into the economy.

Without the support of the JobKeeper measure - which is seeing around 3.5 million Australians maintain their connection with the employer - Treasury estimates the unemployment rate would peak at around 15 per cent.

With JobKeeper, Treasury forecasts the unemployment rate will peak at around 10 per cent, or 1.4 million unemployed, in the June quarter.

The JobKeeper scheme and other support measures have been critical in assisting businesses retain their employees and remain open.

Research by MYOB found that 84 per cent of small business owners reported that JobKeeper allowed them to continue trading.

While the challenge is significant, the Government has a plan to get the economy going again, not just to address the short-term challenges but also through a long-term plan to support jobs and economic growth.

And in that regard I am pleased that Moody’s has recently reaffirmed Australia’s AAA credit rating.

Where we are now

As we saw last night, the International Monetary Fund released their global forecasts, with Australia the only advanced economy to have its economic outlook upgraded.

Similarly, in the OECD’s global economic outlook earlier this month, Australia stands out as a leader in the economic recovery.

While the OECD expects Australia’s economy to contract by 5 per cent this year, the IMF predicts a 4.5 per cent contraction.

Both forecasts expect Australia’s economy to grow by 4 per cent next year. 

This stands in stark contrast to developed economies around the world. 

In the United States, the economy is expected to contract by 8 per cent in 2020.

In Canada, it will contract by 8.4 per cent. 

In the United Kingdom, it will contract by 10.4 per cent.

And in Europe, the economies of both Spain and Italy are expected to contract by 12.8 per cent.

These numbers put in context the success Australia has had in comparison with the rest of the world in limiting the effects of COVID-19.

By effectively flattening the curve and providing the necessary economic support for businesses and individuals, we are now reopening our economy in a safe manner.

This vital economic support was only possible because we entered this crisis from a position of economic strength.

The economy was growing, unemployment was falling, we had a record number of people in jobs, and the Budget was in balance for the first time in 11 years.

Australia is opening up again - and this is boosting the confidence of consumers and businesses.

According to the Westpac and ANZ consumer confidence indices, we can see that consumer confidence is returning.

ANZ’s index shows consumer confidence rising to early March levels, while Westpac’s index has seen consumer confidence rise to around pre-COVID-19 levels.

After the dramatic drop in early April, it is good to see that consumers are regaining their confidence.

Confidence is important, because it’s not enough just to have restrictions lifted and be allowed to open your doors - you also need the confidence that customers will come through that door.

You need the confidence to purchase stock and inventory.

You need the confidence to re-hire staff.

Research by the National Skills Commission has shown that of businesses that have re-opened in May, 73 per cent had reinstated some or all, of their staff.

It’s a welcome sign that confidence is climbing - we can expect the flow on effects to boost trade for the retail sector.

We also know that the overwhelming majority of Australian small businesses believe they will be able to weather the effects of COVID-19.

Just last week, the ABS released its preliminary retail trade figures for May, which showed an increase of 16.3 per cent in May, almost completely reversing the 17.7 per cent drop in April.

This actually means that retail turnover is now up 5.3 per cent over the year since May 2019.

Retail turnover rose sharply in clothing, footwear and accessories, and cafes, restaurants and takeaway food services as lockdown restrictions were eased, although they remain below their May 2019 level.

The data also shows that turnover increased in household goods and food as people spent more time at home.

This is good news for the retail sector, but whilst recovery is underway, the sector remains vulnerable and is dependent on restrictions continuing to ease. 

Everything we do now must be to get businesses back in business and workers back in jobs.  This is the Government’s primary purpose.

Where we are going: JobMaker Plan

We are working to create the real and sustainable jobs that provide economic security for families across Australia.

Our Government’s five year JobMaker plan charts the way forward for a new generation of economic success.

JobMaker is our plan to return Australians to work and return Australia’s economy to growth.

As we begin to emerge from the crisis, and as we plan for the future, skills and industrial relations reform, infrastructure investment and deregulation will play a critical role in our JobMaker plan.

Skills Agenda

As we look to create jobs in a labour market undergoing major change, reforming Australia’s skills and training system is a JobMaker priority for national recovery.

I am leading a reform roadmap to deliver a system that will ensure Australians are better trained for the jobs businesses are looking to create.

And so as a part of our JobMaker plan to improve skills, there are three key issues for reform:

  • The complexity of a system that is unresponsive to skills demands;
  • The lack of clear information about what those skills needs are; and
  • A funding system with little accountability back to outcomes.  

Currently by law, the Commonwealth must hand over to the states and territories $1.5 billion in untied funding every year – with no end date, no questions asked, and no outcomes attached.

So it’s time to make some changes.

However, to support the skilled jobs of the future, we can go further than agreeing on a better funding arrangement, we also need a more responsive system of research and delivery.

Currently, the average timeframe to develop or update training products is 18 months, with a third taking over two years to update.

COVID-19 has shown we can move quickly to flag emerging skills shortages.

We knew at the outset that we had to drive rapid and flexible development of training packages during the COVID-19 crisis.

Working with my State and Territory counterparts, we have rolled out two skills sets in a matter of weeks in what usually takes over a year.

One of those is an accredited infection control course previously only widely available in the health sector - which has been adapted for key industries like retail.

This will now be rolled out nationally to support customer-facing businesses in training workers to minimise the risk of spreading COVID-19 so these businesses can reopen safely - and the Government is funding 80,000 training places across Australia.

By providing an agile and responsive skills and training sector, we will be able to equip Australians with the skills they need for the jobs of the future.

Industrial Relations Reform

As part of our JobMaker Plan getting our industrial relations settings right is absolutely necessary to make it easier for businesses to employ the workers they need.

There is complexity in the system that businesses and employees struggle with.

As a former Minister for Industrial Relations, I know that there can be entrenched positions when it comes to IR laws and policy.

That is why the Government has established five working groups so industry, unions and key stakeholders can come to the table and work together on the key areas of:

  • award simplification, enterprise agreement making, casual and fixed term employment, compliance and enforcement, and greenfields agreements.

Given the retail sector employs over 1.3 million Australians, it is important that your views are central to these discussions.

That is why organisations including the Australian Retailers Association and the National Retail Association have been appointed to the working groups.


We can also support job creation through effective deregulation, by removing burdensome red tape, unnecessary roadblocks and the impediments to getting on with running your business and creating jobs.

Often small business owners spend too little time running their businesses and too much time filling out paperwork to ensure they are complying with a dizzying array of rules and regulations that are often onerous, duplicated, and cut across each other.

Through our JobMaker Plan, successful deregulation can have many benefits for the retail sector, including productivity gains and supporting the creation of jobs, ultimately making businesses more competitive, efficient and productive.

We have already seen gains off the back of reducing unnecessary red tape through the Deregulation Taskforce.

We have simplified business registers and are making it easier for sole traders and micro-businesses to employ people.

We have already seen examples of how successful deregulation can provide practical solutions to problems.

In Queensland, Western Australia and South Australia, shop trading hours were deregulated so people did not have to wait in long queues while socially distancing.

COVID-19 has also revealed the importance of keeping pace with digitisation, both in business practices and in our regulations.

For example, laws which required businesses to use paper instead of electronic means to store information were ripe for modernisation.

Being able to sign documents with electronic signatures and conduct virtual AGMs are practical solutions to a real problem for businesses.

Changes like these give our economy the agility it needs so that we can save businesses and jobs.


When small businesses are agile and readily adopt new ways of operating, they increase their chances for success and are able to seize the opportunities that present themselves.

This is particularly true when it comes to digitisation, including e-commerce.

Small and Medium Enterprises with higher levels of digital engagement are 50 per cent more likely to be growing revenue, eight times more likely to be creating jobs, seven times more likely to be exporting and 14 times more likely to be innovating new products and services.

We know from American Express’s Shop Small Campaign research, that while we are still dealing with COVID-19, only a third of customers feel comfortable returning to brick-and-mortar retail.

This makes the adoption of new technologies and the participation in the digital economy all the more important for small retail businesses, as customers increasingly turn to online shopping to purchase the products they need.

A survey conducted by NBN Co reveals about half of those asked had increased their online shopping during the pandemic shutdown period. And 70 per cent are consciously supporting local businesses online.

70 per cent also said they wanted to support local businesses, but felt they only had a limited online presence.

The NBN survey also found that developing a stronger online presence was one of the top strategies local businesses could adopt to make it easier for people in their communities to support them.

We can see the effects of this shift in consumer habit to online sales during a period where we couldn’t go to stores.

A 50 year old floor covering business headquartered in Gatton, Queensland, found that customers were no longer visiting showrooms due to the virus and were less inclined to buy a product they had not seen or touched.

In response, the business launched an augmented reality app to enable customers to visualise flooring products in their own homes in real time, and to request a safe viewing of real samples during a measure and quote by appointment.

As a result, they have retained 100 per cent of their workforce, all in country towns, and are looking to expand this year.

For companies that already have an established digital presence, e-commerce was an opportunity to weather the storm or in the case of some, increase their business.

But the challenge remains in encouraging small businesses that have no digital presence to take that first step, and show them the benefits and opportunities available.

That is why the Government is committed to the Small Business Digital Champions Project and the Australian Small Business Advisory Services Digital Solutions Program.

We are also assisting small businesses to strengthen their cyber security through the Australian Cyber Security Centre.

Cash Flow

Research commissioned by the Council of Small Business Organisations Australia shows that one of the top concerns consistently front of mind for small businesses is cash flow.

36 per cent of small businesses with 4 or fewer employees named it as a top concern, while 29 per cent of businesses with 5-24 employees also ranked it as a key concern.

Getting paid on time is one important element of managing cash flow.

Small businesses shouldn’t have to wait long periods to be paid the money they are owed.

Late payments impact the ability of a firm to invest, grow and employ.

This is why we have introduced the Payment Times Reporting Bill.

It is designed to shine a light on large business payment performance and push these organisations to improve their payment times to small businesses, leading to fairer and faster payments.

While many small businesses are feeling the pressure from the effects of COVID-19, the adoption of digital technology solutions like e-Invoicing offers greater opportunities to small businesses owners to get paid faster and improve their cash flow.

As more shops begin to open again in a COVID-Safe economy, many businesses are continuing to operate without cash, using contactless cards instead.

While there are many benefits to contactless card transactions, there is greater need for value for money through merchant fees.

Many small businesses have found the cost of their merchant fees have risen during COVID-19 as customers have swapped to contactless payments and business owners are either unaware of or have not been offered the option to use least-cost routing.

Least-cost routing would ensure that where multiple merchant providers are available on a card, the transaction is automatically processed through the provider with the cheapest fees.

Providing this choice to small businesses could save retail shops thousands in unnecessary fees.

In fact, if least cost routing is used, retail and small business associations estimate the savings to be up to $550 million each year.

Earlier this month, Assistant Governor of the RBA, Michele Bullock, stated that “the evidence is that the growing availability of least-cost routing has increased competition among card schemes through reductions in interchange fees”.

But the RBA also pointed out that despite the availability of least-cost routing for a couple of years, major banks have not widely promoted the option for their customers.

That is why I have written to Anna Bligh at the Australian Banking Association, to express my support for the RBA’s call for merchants to be given the option of least-cost routing and encourage Australia’s largest banks to clearly offer the choice for their small business clients.

Small Business Campaign

With restrictions being gradually lifted across the country, the importance of our small and family business retailers to the success of Australia’s economic recovery is critical.

We have over 3.5 million small and family businesses across the country, employing nearly half the national workforce.

This is why the Government announced $5 million for a national campaign to encourage Australians to support their local small and family businesses.

The campaign, run by COSBOA, will encourage Australians to buy and spend locally and foster an awareness of the important role of small business in the economy and community.

As we know, when small business retailers prosper and grow, we all benefit.


Ladies and gentlemen - businesses and workers in retail have shown great ingenuity by innovating and adapting during COVID-19.

Our JobMaker plan will harness this ingenuity to drive an agenda of job creation.

The resourcefulness of Australians working together will see us emerge stronger on the other side.

It is this common-sense approach in solving problems, demonstrated time and again by employers and employees alike across sectors like retail, which will secure the future of all Australians.

Our JobMaker plan will get Australians back to work.

We are undertaking skills and industrial relations reform, removing unnecessary red tape, supporting the digital economy, making sure small businesses are paid what they are owed on time, and encouraging all Australians to support the thousands of small businesses in their local communities. 

This is our pathway back to prosperity.