NSW Labor to seek amendment to residential and commercial rent packages

A media release, issued by Shadow Minister for Consumer Protection Julia Finn, advises that NSW Labor will seek to amend the Berejiklian Government’s residential and commercial rent package – when the NSW Parliament is recalled saying "it is “disappointing”, “modest” and “very complex” compared to Commonwealth assistance programs".

Ms Finn said "It does little to help renters or “Mum and Dad investors” who own a single unit. In NSW, only 16 per cent of residential landlords pay land tax; 84 per cent of landlords will miss out."

"Tenants and landlords will have to take disputes to the NSW Civil and Administrative Tribunal (NCAT) – which is very complex and difficult for renters and landlords to navigate, if they are unable to reach mutually agreeable arrangements."

The NSW Labor has however welcomed the moratorium on evictions. But it has expressed its strong concern about that any unpaid rent will accrue – meaning someone who loses their job and struggles through the COVID-19 crisis will be hit with a massive bill at the other side.

Ms Finn said "Meanwhile in Queensland, the Palaszczuk Government has announced a land tax relief program three times larger than NSW as a percentage of land tax revenue and is also offering last resort grants of $2000 to tenants to cover four weeks rent when they have nowhere to turn."

NSW Labor was reporting to media reports on the Berejiklian Government’s package announced this morning.  "The Berejiklian government will spend $440 million on its residential and commercial rent package, which will force landlords and tenants to negotiate in a bid to stop rent strikes or evictions. NSW Parliament will be recalled to pass the new measures to help renters who have lost at least 25 per cent of their income or businesses with revenue down at least 30 per cent." SMH By Alexandra Smith April 13, 2020

The measures being put forward by the NSW Government will apply to commercial leases where the tenant is in financial distress due to COVID-19, including but not limited to shops, cafes, gyms, hairdressers, restaurants, offices, warehouses and industrial sites. The land tax relief is expected to be divided approximately 50-50 with around $220 million going to the commercial sector and a further $220 million expected to benefit the residential sector. Commercial landlords will be offered the land tax concession if they pass the savings on to tenants through a rent reduction. In making the announcement Finance and Small Business Minister Damien Tudehope said the package demonstrated the need for a united effort to endure the COVID-19 pandemic. “Breathing room on rent is one of the most frequently raised issues by businesses, and we want to ensure we protect retailers and offer landlords an incentive to do so. We also want to ensure retail tenants have more time and options,” Mr Tudehope said. “For any small business rent is one of the biggest fixed costs, easing this burden will help operators survive and keep people employed.” Treasurer Dominic Perrottet said it was important that both landlords and tenants understood that the policy only applied to those businesses significantly impacted by COVID-19. “If your circumstances have not significantly changed you need to fulfil the terms of your existing agreement.” Mr Perrottet said.

Shadow Minister for Consumer Protection Julia Finn said residential tenants, agents and landlords are again left in a state of chaos and confusion. “I do not see how an unemployed hospitality worker can negotiate a rent reduction and then pay back the whole so-called reduction in six months.”

“Almost one third of NSW are in rental accommodation. That’s one third of our state worrying about whether they might be able to keep a roof over their head during this crisis with no assistance from the Government.”

“Relying on land tax relief to be passed on to tenants ignores the simple fact that many lower value rental properties do not pay land tax and small `Mum and Dad’ investors are not required to pay land tax.”

“Mum and Dad investors with a single unit in western Sydney, the Hunter or the Illawarra/South Coast will receive little assistance from the package as the current land tax threshold is around $734,000 - calculated using unimproved land value with primary residence exempt.”

NSW Shadow Treasurer Walt Secord said: “This package is a cruel hoax and does little to help renters in modest units and does nothing to help `Mum and Dad’ investors with a single unit, who do not pay land tax.”

“These landlords may want to pass on any savings they can to help their struggling tenants –but the Berejiklian Government is providing them and their tenants with nothing.”

“Therefore, when NSW Parliament is recalled, NSW Labor will seek to amend the package. We will also seek a briefing on the detail of the package so we can improve the package. As it stands, it is modest, disappointing and very complex,” Mr Secord said.

Shadow Minister for Finance and Small Business Daniel Mookhey said he was also disappointed in the arrangements for commercial tenants and commercial landlords saying the package centres mainly around a “deferral” and with small businesses like cafes, shops and hairdressers facing massive bills down the track.

“This package ignores the thousands of commercial tenants and commercial landlords across NSW and they be rightly disappointed by this package, when they see that it is simply a deferral. This means when they are struggling to get back on their feet after the COVID crisis, they will slugged again.”

“We will also try to amend the commercial aspects to the package, subject to further information from the Berejiklian Government.”

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